Valentine’s Day has been a day to shower your loved one with expensive dinners, gourmet chocolates, flowers and gifts galore. But this year, it seems even love cannot completely conquer a weak economy.
Cupid-struck couples are expected to spend $20 less on each other this year, according to a survey tiffany jewelry conducted by BIGresearch for the National Retail Federation. On average, they’ll spend $102.50 each, a 15.6% decrease from a year ago.
“Valentine’s Day will be the first major holiday of 2009 to feel the economic pinch,” says Robert Passikoff, president of New York-based Brand Keys, a consumer- and brand-focused research consultancy.
This year, $14.7 billion will be spent on Valentine’s Day-related purchases, according to BIGresearch. Nearly 91% of people will spend the most, an average $67.22, on their significant other, with other family members such as children getting about one-fifth of the budget, $20.95. A few dollars will be spent on: friends, $4.74; children’s classmates and teachers, $3.59; co-workers, $1.94; and pets, $2.17.
It doesn’t pay to scrimp too much
Despite the slowdown, Loch Rose, vice president of analytics at ShopLocal.com, says he doesn’t expect a complete halt for a few reasons.
For one, cutting back 25% on Christmas gifts overall could offer significant savings — $100 or more. Given the typical spending for Valentine’s Day, a 25% cutback does not offer the same savings. At most, consumers will end up with a few extra bucks this month, Rose says.
Then there’s the question of priorities: Is scrimping on your valentine really the best idea?
“You can disappoint Aunt Maple over the holidays by not giving her a gift, but if you disappoint your significant other on silver cufflinks Valentine’s Day, you’re going to be hearing about it every day for a long time,” Rose says.
“But it’s not just about being afraid of not buying something for your girlfriend,” said Clark Wolf, president of Clark Wolf Co., a food, restaurant and hospitality consulting firm. “Valentine’s Day is a day to celebrate each other.”
Wolf says restaurants should see strong sales for the holiday, not only because the holiday falls on a Saturday but also because of smart marketing. “People are offering deals like free glasses of sparkling wine and keeping prices closer to their regular menus,” Wolf says. “It’s about added value, not up-selling.”
Still the economy has some people thinking twice. Henrico Norman of Penrose, N.C., surprised his girlfriend last year with an $1,800 trip to Las Vegas, even though money was already tightening.
The couple spent the weekend horseback riding, taking a helicopter tour, people-watching and “pigging out,” Norman wrote in an interview by e-mail. “This year, we will drive to Charleston, S.C., for the long weekend.” He says he has budgeted less this year, $800, but he is happy to spend the money for time with his girlfriend of three years. “It’s worth it because she is the best.”
Despite people’s plans to spend less, the NRF does not expect people to drastically change where they shop. More than a third of people, 35.7%, will buy flowers, close to last year’s 35.9%, and 16% will bring home jewelry, down only slightly from 16.6% in 2008. More people, however, will express their love with a greeting card, up from 56.8% in 2008 to 58%.
Presidents Day adds to the fun
With Valentine’s Day falling on Presidents Day weekend, some people also are finding more reasons to travel.
“The phones are ringing,” says Jon Makhmaltchi, vice president of sales for Small Luxury Hotels of the World. And while it is too early to determine if Valentine’s Day travel on the whole will be up, people are finding reasons to go away, he says.
“It’s like three trips in one,” Makhmaltchi says of the overlapping holiday. And if lovers didn’t have enough reasons to silver money clips get away, hotels and travel hot spots are giving vacation-bound valentines a few extra incentives.
“One of the upsides in this downward economy is there are more travel deals for consumers,” says Jeanenne Tornatore, a spokeswoman for Orbitz Worldwide. Orbitz has seen three times as many hotel promotions as at this time last year.
“If I get you to stay an extra night I’ve done my job,” says Joseph DeNucci, president of the Borrego Ranch Resort and Spa in Borrego Springs, Calif., which began advertising its holiday special in mid-January and sold out less than a week later. That package, if you were one of the 44 who reserved it, gets you a candlelight dinner, two 50-minute spa-treatment sessions and room amenities from sparkling wine and chocolate strawberries to an aromatherapy bath gift. Price: $395 per night.
“People are out there taking advantage of those deals,” Tornatore says.