LOS ANGELES — Valentines Day is upon us and industry research firm IBISWorld has released its annual holiday sales forecasts. This year, IBISWorld expects total Valentines Day spending to be up 3.3 percent from 2009, reaching $17.6 billion. Because Valentines Day falls on a Sunday, the research firm anticipates consumers to move from traditional gift-giving towards dining out.
Because Valentines Day lands on a Sunday, restaurants are likely to gain traffic throughout the entire weekend, said Toon van Beeck, senior analyst with IBISWorld. Furthermore, because Presidents Day is on the following Monday, many consumers will be able to travel over the three-day weekend, further boosting restaurant sales.
With consumers dining out and traveling, Valentines Day will not be as joyous for retailers. Men typically buy candies, flowers and jewelry during the work week, but since the holiday falls on a Sunday they will not feel as much pressure to purchase by Valentines Day. As a result, they are not as likely to take the time on the weekend to shop, opting instead for a romantic dinner out.
Many retailers will see Valentines Day as an opportunity to kick start the new year, but the unemployment rate and continued uncertainty of the economic recovery will hamper growth and expansion, explained van Beeck. This combined with the fact that the holiday is a discretionary purchase, IBISWorld expects customers to remain on the shopping sidelines for the second consecutive year.
One industry in particular that relies heavily on Valentines Day is florists, and businesses must work extra hard this year to achieve their desired sales. Research from the Society of American Florists shows that Sunday is the worst day for florists come Valentines Day, therefore making this years sales especially bleak. IBISWorld expects florists to counter this by pushing early promotions in an attempt to increase orders and building sales throughout the week leading up to the weekend holiday, opposed to just a day or two beforehand.
Source: IBISWorld Inc.