With Valentine’s Day spending projections down to $102.50 from 2008’s $122.98 figure, according to NRF, retailers were looking to spread the love and get consumers out spending. While some analysts expressed concern that too many retailers continued to pull the discounting lever, there were some signs this holiday that retailers are getting more creative with cross channel promotional offers that may shore up the broken pricing levels.
“Consumers have different perceived values and emotions for their loved ones, and marketers should try to better understand these differences and promote to consumers’ emotions rather their wallets,” says Yoram Greener, Senior Director, DbM Consulting, Merkle. “Marketers need to realize that every promotion is an opportunity to build relationships with their consumers. Having said that, retailers need to look deeper into customer preferences and reactions to be successful. Competition on price is a dangerous value proposition, since you end up commoditizing your value proposition, rather build relationships.”
Although holidays such as Valentine’s Day and Mother’s and Father’s Day, represent smaller revenue opportunities compared to the fourth quarter, industry experts suggest they are a missed opportunity to engage with new customers. “Our research shows that when it comes to these holiday gift-giving opportunities, retailers really focus primarily on the fourth quarter, but they are missing the day in- day out opportunities you have with birthdays, anniversaries and smaller holidays that come around,” says Pam Danziger, president of Unity Marketing. “They don’t realize that gift-givers actually spend more money throughout the year for those occasional holidays than they do in total at Christmas time.”
Retail TouchPoints found the following bright spots for Valentine’s Day from the Valentine’s promotional landscape:
Tiffany’s nurtured last-minute shoppers by offering complimentary shipping and guaranteed Valentine’s Day delivery for customers who order online by noon today. In addition, the jeweler offered complimentary engraving in-store and online on select items Feb 2-9. While the company has a long standing policy against price promoting, they are thinking outside the little turquoise box to offer shoppers something different, while catering to customers by offering a personal touch.
Talbots, playing off the pessimistic consumer mindset, asked shoppers to share their worst Valentine’s Day gift ever on the retailer’s Web site. The grand prize winner gets a $1,000 Talbots wardrobe and a trip to NYC for a shopping day with Chief Creative Director Michael Smaldone. Second and third place winners win $500 and $250 Talbots gift cards.
“What I really like about [the Talbots promo] is that it encourages customer involvement,” says Danziger. “That’s the hook. It’s not the 20% off, but it makes the customer respond and become involved. It provides a platform of involvement and relationship with the customer that makes it so much more meaningful than simply buying a product or getting a discount. That’s making the connection.”
Sears is playing on the Valentine’s Day theme to sell some decidedly unromantic products. Its “Love this Sale,” which offered no payments or interests for 12 months on appliances over $300 with a Sears card, plus free standard delivery and haul away after Mail-In rebate.
“Most retailers define ‘loyalty’ as ‘market share,’” says Mark Lilien, consultant with Retail Technology Group. “True loyalty is defined as ‘price independence.’ It’s the difference between Dell and Apple. For Valentine’s Day, the best thing any large retailer can do: have merchandise of superior design not available elsewhere. For small retailers, have an assortment that’s unlikely to be duplicated nearby.”