New data from the leading eCommerce provider Visualsoft, shows that revenue increased for retailers in the run up to Valentine’s Day, but that brands and stores are having to work harder to capture sales.
In the key sectors of jewellery, fashion, gifts and health, lingerie, beauty & cosmetics there is a trend for higher revenue year on year, but lower Average Order Value, suggesting that retailers are needing to attract more sales to have the same effect.
Fashion saw revenues rise 33%, gifts, gadgets and gaming increased a staggering 76% compared to 2023, the health, beauty & cosmetics category was up 20%, and lingerie & underwear increased by 10%. Yet jewellery, a go to staple for this time of year, remained broadly static, dipping -0.5%. Overall it paints a positive picture, with revenue above inflation for almost all sectors. This could point to people purchasing for themselves, embracing ‘galentines’ and ‘palentines’ through gaming, wanting to look good through fashion, or simply not buying expensive presents that the holiday has become synonymous with.
However, when it comes to Average Order Value smaller basket sizes are the norm. Basket size in fashion has shrunk -15%, gifts gadgets & gaming decreased by -14%, order sizes in health, beauty & cosmetics were down -2%, jewellery by -11.% and lingerie & underwear by almost a quarter, at -24%. Retailers are having to get more visitors and more transactions to grow their sales, as customers tighten their belts amidst a cost-of-living crisis. This seems to show a clear shopping pattern of people shopping around and leaning towards cheaper items over potentially expensive named brands.
Valentine’s Day has received criticism for being too consumerist, so individuals may be shying away from grand gestures, but it seems people still want to celebrate in some small way. This may be what is behind the 164% increase in the search for ‘promise rings’ and 23% for ‘charms’ – a less expensive offer than a diamond ring.
Data shows that mobile orders are high in fashion (73%), health beauty & cosmetics (55%) and jewellery 74%. However it seems a more considered purchase is made with lingerie and underwear where only 18% of orders happen on the mobile.
Ash Wright, VP of commercial at Visualsoft says of the data: “With shoppers on the go using small pockets of time to look for purchases, and seeking deals wherever they can, it seems people are shopping around more, not necessarily locked into a certain name or brand of item that they want. Strong advertising on social media and email marketing can drive mobile shoppers to a site and as long as it has a smooth and seamless checkout system, this can boost sales from impulse buying. Brand loyalty seems to be on a decline especially with younger audiences, and as such retailers are having to offer deeper discounts at the same time as communicating values and ethics in order to attract them – a tricky balance. Yet the fact that there are more transactions, of smaller amounts, suggests that for those willing to work for it, repeat shoppers are where growth is at.”
Senior digital strategist, Immy Ewbank advises: “Overall, during a time of economic downturn and consumers shopping smaller, think about the “lipstick effect”, coined by Estée Lauder’s Leonard Lauder. Even in a cost of living crisis people will still treat themselves or others with small luxuries which helps to boost their mood. Because of this, customer loyalty and win back opportunities are more important than ever! For brands, now is the time to get your loyalty scheme with “refer a friend” incentives set up, and gift guides polished. Smaller items, or “little luxuries” can be perfect items for thoughtful and cost effective gifts, consider any upsell moments for smaller items to boost your Average Order Value. And as we’re living in an immediate consumption cycle, next day delivery with a reputable courier can be a big confidence builder for shoppers while they’re deciding where to purchase.”
