Insights|Retailers: Are You Ready for Valentine’s Day?

Retailers: Are You Ready for Valentine’s Day?

U.S. consumers are getting ready to spend a combined $27.4 billion on loved ones – from friends and family to co-workers and even their pets this year.

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Valentines day retail
by Sitel staff February 11, 2020 - 4 MIN READ

U.S. consumers are getting ready to spend a combined $27.4 billion on loved ones – from friends and family to co-workers and even their pets this year.

Following a 4.1% surge in holiday retail sales, which saw U.S. consumers spend $730.2 billion, the National Retail Federation (NRF) is confident this upward momentum will continue through Valentine’s Day and that another record could be set.

Data compiled by the NRF in conjunction with Prosper Insights & Analytics, shows those consumers ready to celebrate Valentine’s Day are planning to spend an average of $196.31. That’s a 21% increase on last year’s average figure and means retailers and restaurants could be in for a $27.4 billion windfall.

A new record for retail

As for where that money is going to be spent, jewelry, an evening out and clothing were the top three responses based on total spend. The results suggest couples will spend a combined $4.3 billion on going out for the evening and $5.8 billion on jewelry. The most popular response, cited by 52% of those polled was candy.

And this is because the notion of Valentine’s Day is evolving. As well as treating a husband, wife or partner, people are increasingly lavishing gifts on friends, co-workers and even their pets. More than one in four (27%) of consumers say they’re going to treat their pets to the tune of $1.7 billion.

So how do you ensure your business earns its rightful share of this record-breaking Valentine’s Day spend?

Be understanding

The first step is to know your customer. Thanks to omnichannel commerce and customer experience, no two customer journeys are going to be the same. However, this year’s NRF data shows that men plan to spend more than women on gifting and that those aged 35-44 are planning to spend the most – an average of $358.78. Now compare that figure with 18 to  24-year-olds who have budgeted on average just $109.31.

Be Social

Knowing the target demographic will steer promotional activities. With the amount of potential customer value it would be wiser to invest in ads on Facebook and Instagram, for example, than on Snapchat – 78% of 18 to 24-year-olds might be using it daily, but only 45% of social networking 30-49-year-olds do. Likewise, on Facebook in particular, generation X consumers say the most useful function or service in regards to holiday or occasional spending is targeted offers, promotions or coupons.

What we are seeing year on year is a growing reliance on social channels for initial inspiration, particularly Instagram and Pinterest – 40% of 53-44-year-olds research products via social channels and 23% say they’ve discovered a brand thanks to a social ad. This is why it’s crucial for restaurants and jewelry stores in particular to get their social act together. Post the right imagery and content to provide the inspiration needed but also offer the ability for consumers to reach out to you directly and ask questions – getting a jewelry purchase right first time is always a challenge.

Be mobile

We also need to remember that whether research is being conducted via social, simple Google searches or checking out Amazon or Yelp reviews, it’s happening on the move. Mobile now accounts for 56% of Google searches in the U.S. and is why the company has moved to mobile-first indexing. It means your website needs to work well on a mobile device and just as important, because half of mobile searches also include a locational element, all geotagging information needs to be to date. So, if you’re a restaurant, your full address, opening hours and busiest times must be included.

Be alert

St. Valentine’s Day is a great opportunity for any retailer or restaurateur to test out push notifications or SMS. Keeping shoppers up to date on special offers, letting people know about delivery times or remaining stock and for those heading out to eat, notifications about waiting times or even other things to do in the immediate area could all make an invaluable difference. SMS, in particular, can be used to serve every step of a customer journey and is as mobile as the average customer. What’s more, unlike push notifications via social or web channels, the SMS is the only universal channel, supported by 100% of mobile devices.

Be conversational

If you’re going to use alerts and notifications, you also need to be ready to engage. Customers may have questions and this is an opportunity to start a conversation. One where you demonstrate you understand the customer’s need and show that you can help them. Whether the conversation starts via the live chat window on your website or via a social channel, these types of engagement could make the difference between winning a new customer and increasing your bounce rate.

The companies that really take full advantage of these opportunities to connect are those with omnichannel customer service agents – people who are able to respond directly to a customer whether they phone, text, social message or use live chat to reach out.

To discover more about the benefits of conversational messaging for business, watch our free webinar.

Be ready

One last thing to bear in mind is the performance of your after-sales service. An estimated $2.9 billion will be spent on gifting clothes to a loved one. Buying clothes can be just as big a challenge as getting the right earrings or necklace. Payments processor WorldPay noticed a 95% spike in refunds across retailers it supports in the U.S. on February 15. When it investigated, it found that 99% of this spike was people returning clothes that had been purchased as Valentine’s Day gifts.

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