Analysis: Valentine’s Day under COVID-19 will break last year’s record sales
Consumer psychology is primed to make Valentine’s Day an even bigger retail event this year than last year, when sales hit an estimated $27.4 billion representing a 20% year-over-year increase from 2019. Here’s why: Our first COVID Valentine’s Day will be more than a celebration for couples. It certainly won’t lose its romantic roots, but those roots will spread out in many other, often unexpected directions.
We’re basing our projection on a couple of inputs. First, the 2020 holiday season surpassed all predictions, bringing in a record-breaking 8.3% growth in November and December sales. From that, we learned that consumers don’t necessarily do what they say in the surveys.
Second, from our purview, we got a close look at gift-giving behavioral changes during Mother’s Day, 2020, the first holiday under the COVID-19 pandemic shutdown. Our own network data turned up a staggering 667% year-over-year increase in gift-giving for Mother’s Day. Even taking the migration to the online channel as a given, we saw an escalation not only of volume, but of value and range of gifts exchanged.
This year, Valentine’s Day celebrations will extend much further beyond romantic partners than usual, and will include sharing warm feelings with friends, family, classmates, teachers, and co-workers who normally wouldn’t fall within the usual circle of close connections Valentine’s Day encompasses. Pets, too, will get more than the usual attention, since they’ve increasingly become recognized as full-fledged members of the family and adoptions this year have been sharply up.
All gifts, most especially Valentine’s Day gifts, act as a proxy for affection—social currency that symbolically communicates feelings of caring, concern, and love from one person to another. With social distancing keeping people apart—over 28 million people are in long-distance relationships—Valentine’s Day gifting will take on even greater importance as a means of deepening personal connections.
After all we’ve been through during the pandemic year, more employers will also remember their staff members this Valentine’s Day. Those gifts will be a way of saying thank you for their extraordinary efforts to keep business going while working from home and operating under stressful in-person conditions. I base that forecast on the explosion we saw in corporate gifting over the end-of-year holidays. It seems to have become a way for businesses to put a glow on their culture, even from a distance.
Indeed, social distancing will change the very nature of this year’s Valentine’s Day celebrations, shifting a major portion of spending from experiences to more meaningful and extravagant physical gifts. Gourmet wine and food baskets will take the place of the romantic dinner reservation at the fireside table. Popcorn and movie packs will strive to recreate the cinema experience at home. And people will explore new ways to celebrate together via Zoom or FaceTime, including strategically locating flower bouquets as a backdrop during office meetings to kick up envy or express appreciation among colleagues.
There’s also a calendar anomaly our projections are taking into account. Valentine’s Day this year falls on a Sunday, rather than on a Friday as it did last year, and it’s also part of the long President’s Day weekend. Historically, when Valentine’s Day occurs during the weekend, demand for gifts falls as celebrations shift to dining out, movies, travel and other weekend getaways. But it’s a given that travel is pandemically down, restaurants are open only at reduced capacity, movie theaters are closed and other away-from-home entertainment is on hold. Much of this potential to spend will be rechanneled to online retail and gift giving.
This year’s NRF Valentine’s Day forecast is spot-on that online will be gifters’ destination of choice. The trend toward gift shopping going online and gift giving going virtual was already well underway before the pandemic hit, but it became supercharged because of it. The big winners have been virtual gift services and contactless payment forms that meet consumers’ need for seamless and safe ways of shopping. Virtual gift delivery offers another important bonus: eliminating the need to hand pack and return unwanted items. This is a boon to retailers as well as gift recipients.
The pandemic put a spotlight on the importance of celebrating and connecting with loved ones, which will give Valentine’s Day an extra lift this year. Forced to live in quarantine bubbles, people gained new appreciation for how important our personal relationships are—and for those who have been fortunate enough to keep their jobs, there’s been a level of disposable income that didn’t exist last year. Not being able to race out to a restaurant or the theater has given us more time to be meaningfully present in our own lives, and by extension, in the lives of those we care about—in spirit, if not in person.
This year new messages will accompany Valentine’s Day gifts, beyond the traditional “I love you” sentiment. We will share thankfulness that “we made it through 2020.” We will express the deep feeling that “the distance only brought us closer.” Gifts will contain the message, “You matter more than you know” to a wide network of friends, colleagues and into our communities.
When consumers give real thought to who has been important in their lives over the past year, I believe this will be reflected in their Valentine’s Day gift giving. We see it in retailers’ marketing messages about this virtuous circle and, coupled with lockdowns, pandemic and social distancing, and a year of suppressed need to express care for others, I believe we’ll see it as a geometric expansion of gift giving.
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