Back-to-school season brings a wealth of emotions. For some, it breeds excitement and relief, while others feel dread. For retailers, however, it means just one thing: spending. The National Retail Federation's 2010 Back to School and College Survey found that consumers will spend an estimated $55.12 billion this back-to-school season. Those numbers make it the second-largest spending event for the year, behind the winter holidays. Furthermore, performance during the back-to-school season serves as a barometer for what's to come with the holidays. That said, this season in particular presents a real opportunity to build a sound investment strategy - if you know where to look. (For ways to save on retail shopping, check out Coupon Shopping: Clip Your Way To Savings.)

IN PICTURES: 5 Ways To Control Emotional Spending

Look Beyond the Obvious
We know to watch the typical big box retailers that parents and incoming freshman frequent for back to school shopping. But in this economy, moms are tightening control over what their kids are spending, and retailers who are used to making huge gains from sales on non-necessity items like apparel might take a beating.

But there is some good news. The new spending powerhouses this season aren't the predictable target market of moms and incoming college freshman. According to the National Retail Federation, the top shoppers this back-to-school season are established male college students, dads and those who buy online.

As an investor, your job is to determine to which retailers these golden geese will flock.

Established College Males
According to the National Retail Federation's "Top 10 Trends for Back to School This Year," college men will spend 35% more than women on back-to-college merchandise ($965 vs. $713), which includes personal care items, and furnishings for dorms and apartments - not just electronics. On the contrary, freshmen spending will drop by 19% this year, potentially because fewer are moving out of their parents' home. (Find out more about college budgeting; read Save On College Budget Busters.)

And where will these established college males spend?

Of the college students surveyed, more than 53% will buy from discount stores, 42% at department stores and 36% will purchase from an office supply store. Other outlets include online (28.6%), and clothing stores (28.2%). One area not to overlook? Of all respondents, 43% indicated that they will purchase room décor and apparel from their campus bookstore.


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When asked whose advertising struck a chord, respondents ranked Wal-Mart (NYSE:WMT), Staples (Nasdaq:SPLS), JCPenney (NYSE:JCP), Macy's (NYSE:M), Kohl's (NYSE:KSS), Best Buy (NYSE:BBY) and Office Max (NYSE:OMX) among their top picks. Survey results also indicated that retailers who offer coupon incentives and in-store promotions could fare well in the competition for back to school dollars, as 38.6% and 31% of respondents, respectively, ranked these tactics as influential to their purchasing.

Keeping a tab on these companies just might give you an investment leg up as they head into their peak selling season.

Dads
Moms are an important consumer in retail, but The National Retail Federation also points out that the gap is narrowing; now dad is also a big opportunity to add to the bottom line. According to the survey, dads of children in grades K-12 will spend $671, or 25% more than moms, on clothing, shoes, electronics and school supplies. Where can an investor take advantage of this good news? Focus on department stores, specialty stores and online retailers, where dads are more likely to shop.

Opportunity Abounds Online
Another telltale key to who will fare well in the back-to-school spending bonanza? Look to the retailers that have mastered how to strategically deliver a completely seamless online shopping experience.

The National Retail Federation's survey also found that not only will buyers conduct research of competitor offers online, they'll buy there. Better still, they'll spend $266 more (on average), than those who buy at a brick-and-mortar establishment. This presents a real opportunity for the retailers who not only understand online shopper behavior, but also effectively use CRM and other data to cross-sell and increase purchases.

Kohl's and Staples even took their online presence a step further by venturing into "feel-good" causes and giveaways executed on Facebook. Time will tell if those efforts translate into a successful back-to-school sales season. (For related reading take a look at Sneaky Strategies That Fuel Overspending.)

For the latest financial news, see Water Cooler Finance: Mergers, Hostile Bids And SEC Probes.

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