This Valentine’s Day, Americans are expected to spend a record $6.2 billion on jewelry gifts for their loved ones, up from $4.1 billion in 2021. That number represents the highest in the history of National Retail Federation’s annual Valentine’s Day survey*.
More than half (53%) of U.S. consumers plan to celebrate the holiday in 2022, up from 52% in 2021. And of those who plan to celebrate, almost a quarter (22%) will opt to gift jewelry to a special someone.
It’s worth noting that Valentine’s Day is the second most popular holiday for proposals and engagements, coming in after Christmas.
Jewelry retailers, both online and bricks-and-mortar, will benefit from Americans’ growing desire to show their love with gifts this Valentine’s Day.
“Following the historic level of consumer spending over the winter holidays, it appears that the trend will continue into 2022,” says NRF President and CEO Matthew Shay. “Valentine’s Day is a special occasion for many Americans, even more so as we navigate out of the pandemic, and retailers are prepared to help them mark the holiday in a memorable and meaningful way.”
Millennials spend more than other generations
Overall, Valentine’s Day spending is expected to reach $23.9 billion this year, up from $21.8 billion in 2021 and the second-highest year on record, according to NRF. Unsurprisingly, candy (56%) and flowers (37%) remain the most popular gift items this Valentine’s Day.
Of course, the luckiest people will get candy, flowers, and jewelry.
NRF’s survey found that shoppers expect to spend an average of $175.41 per person on Valentine’s Day gifts, up from $164.76 in 2021. However, another Valentine’s Day survey** from Lending Tree suggests an even higher amount –$208 per person, an increase of 44% compared to last year’s $144. Consumers spent an average of $142 in 2020, according to Lending Tree.
Online continues to be the most popular shopping destination for Valentine’s Day this year, visited by 41% of consumers, followed by department stores at 32%, discount stores at 28%, and local small businesses at 18%, according to NRF.
As for who’s spending the most, it’s couples who are in that one-to-two-year sweet spot of their relationship. They spend $247, according to Lending Tree. Engaged partners also plan to spend more ($322) than married ones ($219).
“People tend to go big when they’re in the early stages of a relationship,” notes Matt Schulz, chief credit analyst at LendingTree, adding that Valentine’s Day spending decreases over time, but it’s not necessarily because of laziness or taking one’s partner for granted. “Some may get a little more practical, choosing to spend their money on things that serve them better as a couple, such as saving for a home or a vacation.”
Millennials lead the pack among the generations for Valentine’s Day spending ($294), perhaps because that age group is most likely to be in the early stages of a new serious relationship than other demographics. Compared to Gen Z ($164) and Gen X ($182), it’s a pretty significant difference, according to Lending Tree.
And finally, men plan to spend significantly more on average than women ($299 versus $123). Their most popular gift choices include: flowers (34%), chocolate or candy (26%) and jewelry (26%). Women, meanwhile, choose very different kinds of gifts for their partners: a special meal (25%), something sentimental (25%), and a card (24%).
Largest U.S. jewelry retailer relies on data analytics
Signet Jewelers is the world’s largest retailer of diamond jewelry and the largest specialty jewelry retailer in the U.S., U.K., and Canada. It operates approximately 2,800 stores primarily under the name brands of Kay Jewelers, Zales, Jared, H. Samuel, Ernest Jones, Peoples Jewellers, Banter by Piercing Pagoda, JamesAllen.com, Diamonds Direct, and Rocksbox, which is a jewelry subscription service.
The company has made significant investments in its “Connected Commerce” strategy, which includes seamless virtual and in-store consulting, asynchronous chat, product visualization, buy online/pick up in store, ship from store, curbside delivery, same-day delivery, and more.
“The story in digital is data,” says Signet CEO Virginia C. Drosos. “This is becoming a real structural advantage for us. Our data analytics capabilities enable us to operate with increasing precision.”
Signet’s investments are paying off: the company’s preliminary total sales for the Holiday Season (November and December 2021) were $2.4 billion, up 30.4% compared to 2020, according to financial filings. Preliminary same store sales (SSS) grew 25.2% year over year and 35.1% on a two-year basis. Meanwhile, e-commerce sales were up $52.1 million year over year, and brick and mortar sales were up $499.9 million.
Data drives migration to off-mall locations
For fiscal 2022, Signet expects to shutter roughly 75 stores and open 85 new stores, primarily in highly productive Banter by Piercing Pagoda format, according to Joan Holstein Hilson, chief financial & strategy officer for Signet Jewelers.
“Looking deeper at our store footprint, we remain focused on optimizing our fleet through data-driven analytics,” she says. “This includes the transition of traditional malls formats to highly productive off-mall locations.”
Specifically, over the past two years, Signet has increased the off-mall penetration within the Kay brand by four points. Now, with nearly half of Kay locations in off-mall formats, the company is seeing growth at these locations outpace traditional mall formats and carry more favorable economics. This strategy has also reduced Signet’s exposure to declining malls across its biggest brands.
“We’re analyzing customer needs down to an even more precise level to determine where Connected Commerce opportunity exists and how we can drive market share growth on a more localized basis,” Drosos says.
Signet is building on its trade area data with customer e-commerce trends, location data like GPS tracking, and macro-level data including traffic draw, tenant adjacencies, and customer demographics from more than 30,000 retail venues in the U.S.
“For example, we’re now analyzing opportunities beyond just trade areas,” Drosos explains. “We’re micro-targeting customers using populations of 3,000 or fewer people. This focused level of data at scale is a significant advantage in the jewelry category and will serve us for years to come.”
Buxton’s customer analytics helps retailers create holistic physical and digital experiences across the entire customer journey, making every interaction count and delivering richer experiences. Learn more on our retail page.
* Prosper Insights & Analytics conducted the NRF survey and polled 7,728 U.S. adult consumers
** Lending Tree surveyed nearly 2,100 Americans