Valentine’s Day this year is a complex brew. When surveyed by shopper marketing agency Savvy, only 38% of customers said they are planning to get involved in Valentine’s Day celebrations this year. The good news for retailers is that many of the shoppers that do hit their stores will make it count, with a third of involved consumers intending to spend more by trading-up to pricier products.
“An improving economic landscape will translate into higher Valentine’s Day sales,” said Savvy insights director Alistair Lockhart.
However, the target shopper this year is not just a cash-splasher. Wider industry trends will come into play, with spending polarised between the top and bottom ends of the market at the expense of the middle, Lockhart warns.
“At the lower end, discounters and single-price retailers are set to enjoy significant sales uplifts. These retailers have rolled out substantial new space in the past year. That alone will increase their reach.
“More importantly however, they are becoming increasingly sophisticated in their execution of events in-store, which we expect will entice shoppers to buy and spend that little extra. Pound stores in particular are ideally placed to benefit from the many shoppers who see Valentine’s Day more as a bit of fun.”
The good news for Fortnum and Mason and its fellow upmarket retailers is that Valentine’s Day is coming at a time when shoppers are buying luxury goods in increasing numbers, with Selfridges’ sales of Pierre Herme Macarons up a staggering 463% year on year and the sales of premium chocolate up 30%. Overall, spending on premium products has increased 13% year on year, the MasterCard annual trend index has reported.
“As consumers financial situations gradually improve, they are looking to take advantage of any extra money,” said MasterCard UK and Ireland president Mark Barnett. “This trend looks set to continue, backing up the evidence of a genuine recovery in consumer confidence and UK retailing.”
One piece of solace for any grocer is that Valentine’s Day is falling on a Saturday this year. “This will mean shoppers have more time on their hands to cook at home – that will undoubtedly benefit supermarkets,” said Lockhart. “We know from our research that shoppers’ biggest expectation of their supermarket will be the availability of Valentine’s meal deals, mentioned by 39%.”
Good news for Morrisons, with its one main, two sides, one dessert and a bottle of wine or box of chocolates for £15 deal. M&S also has a dine-in offer, with a starter, main side, desert, bottle of drink plus box of chocolates for two people, for £20.
“We think people will be staying in this year to enjoy a meal at home rather than heading out to an expensive restaurant,” said an M&S spokesperson.
“People are looking for convenient options as they want to enjoy time with their partner instead of slaving away in the kitchen. We’ve seen an increasing demand for restaurant quality techniques that you can enjoy at home without the hassle. Our new Marc de Champagne Valentines Dessert would be difficult to create at home.”
Retailers should prepare for a “Friday night rush” when shoppers will be picking up last-minute chocolates or flowers.
“There’s unlikely to be a huge surge in demand online as - unlike Christmas - there is lower spend at and most gifts can be picked up at a local supermarket … in fact most Valentine’s Day purchases tend to be bought instore and at the last minute,” said Natalie Berg, Planet Retail retail insights director.
But whether you’re buying chocolates or wine, here at The Grocer we’re pretty shallow, so we’re all about looks this year with our new competition to find the best Valentine’s Day themed instore displays.
So, if you’re shopping and spot something dazzling, eye-catching or even just totally weird, tweet us a picture with your name, store name and location to @TheGrocer via #instorespot! We’ll be announcing the winner on our site after the big day.