February 1, 2012
Affluent consumers are expected to spend a total of $281 million this St. Valentine’s Day, which is more than the predicted general consumer spend of $196 million, according to findings from a study by American Express.
Affluent consumer spending for Valentine’s Day is up 18 percent from last year as opposed to the general consumer spend increasing 8 percent year over year. Additionally, the amount of proposals and weddings expected this year bodes very well for all industries, especially the jewelry market.
“We’ve seen a trend that consumers have been spending more, whether it’s with holiday shopping, holiday travel or overall spend for 2012,” said Melanie Backs, manager of public affairs for American Express, New York.
“Even though the economy is still questionable, the overall trend is that consumers still see a little bit more spending power,” she said.
The study was divided into two groups: couples and affluents. Affluent consumers have annual household incomes of more than $100,000 per year.
Sparkling stats
More than half of consumers this year plan to buy Valentine’s Day presents. Furthermore, 57 percent of affluent shoppers plan to buy gifts.
Affluent consumers do not differ from the general population in terms of what they plan to buy – the most popular items across the board are flowers at 29 percent, gift cards at 19 percent, jewelry at 15 percent and electronics at 13 percent.
Swarovski's ecommerce site
Other than that, consumers are looking to spend the holiday at a restaurant. The number is 46 percent up from last year’s 39 percent.
Another big bump in sales this year is for the expected number of engagements – there are expected to be approximately 4 million on Valentine’s Day.
Therefore, engagement ring spend played a role in this year’s numbers. However, a surprising statistic was that affluent consumers considered a lower number an acceptable amount to spend on a ring.
For instance, 59 percent of affluent consumers believe that $1,000-$5,000 is suitable, 16 percent think that $5,000-$10,000 is acceptable and 11 percent believe that anything over $10,000 is appropriate.
“A lot of consumers look at the Beyonce’s of the world and they see huge rocks, which sets the stage for people in terms of expectations,” Ms. Backs said. “However, the actual survey numbers are much more modest.”
Tiffany & Co. Valentine's Day campaign
Bubbly love
Because the December holidays and Valentine’s Day are two of the biggest gift-giving holidays of the year, marketers have been taking advantage of them.
This is especially true for luxury jewelers. In fact, experts believe that it is in luxury jewelers’ best interests to use all vehicles available to sell love, not necessarily products, in their Valentine’s Day marketing (see story).
However, it is not a holiday just for jewelers.
For example, LVMH-owned Champagne brand Moët & Chandon has ventured into social video to promote its new customizable Valentine’s Day rosé bottles (see story).
Moët & Chandon Valentine's Day bottle
Meanwhile, French fashion label Yves Saint Laurent dove deep into The New York Times Web site to target affluent males who may want to gift loved ones with branded products this Valentine’s Day (see story).
“We didn’t see a lot of different trends in buying between the general population and the affluent consumer, but affluent consumers always tend to spend more than the general population,” Ms. Backs said.
Final Take
Rachel Lamb, associate reporter on Luxury Daily, New York
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