Whether or not you are a lover on it, or you spend it completely alone, Valentine’s Day is an important and highly prominent day for the world economy. Couples spend billions of dollars on flowers, gifts, cards, and expensive meals everywhere across the world on 14 February of every year. Florists, gift shops, restaurants, and jewellers hotly anticipate Valentine’s Day, as it never fails to bring in easy revenues, especially as prices of the goods and services in demand double, or even triple in some cases, right before the day. In the US, Valentine’s Day is the third largest consumer holiday.
According to a report issued by the US National Retail Federation (NRF), the average American citizen is expected to spend approximately $144 on gifts in 2018. The nationwide spending in the US on Valentine’s Day is expected to reach $19.6bn, while in 2017, the spending reached $18.2, which makes the new expected value a near-record one. In 2016, Americans spent a total of $19.7bn. In the US, 55% of the population celebrating the day is expected to celebrate by purchasing jewellery. This means nearly $5bn worth of spending. As for the groups of people expected to spend on evenings out, they are likely to spend approximately $4bn, and those spending on jewellery are likely to spend $2bn, according to the report issued by the NRF.
“With the holidays behind them and the winter months dragging along, consumers are looking for something to celebrate [at] this time of year,” said NRF president and CEO, Mathew Shay. Roses and candy are the most demanded goods during the season.
Interestingly, the American flower industry has seen its production of roses fall by nearly 95%, dropping from $545m to less than $30m. On the other hand, Valentine’s Day and the week ahead of it are considered the peak season for the Colombian economy. The flower industry there shipped more than 4bn flowers to the United States last year—or about a dozen for every US citizen. The United States flower industry often depends on flowers that are produced in Ecuador and Colombia. “The Colombian industry has bloomed thanks to a US effort to expand free trade agreements—and the relentless demand by American consumers for cheap roses,” The Washington Post reported.
“It used to be an occasion for handmade cards and gifts; now, Valentine’s Day cards and gifts, especially flowers and chocolates, are a multibillion-dollar industry that props up whole economies. Cut-flower exporters like Colombia, Ecuador, the Netherlands, and some African countries make the bulk of their export sales revenues during the Valentine season,” The Inquirer reported.
In a survey conducted by GE Money a few years ago among Asian residents from eight countries, the Philippines was ranked the top country celebrating Valentine’s Day. However, the highest spending country on Valentine’s Day was Singapore, as 60% of those surveyed said that they would spend $100 to $500 for the season. Meanwhile, in Japan and Korea, women seem to be spending more on Valentine’s Day as the tradition goes that women give chocolates to men on the day.
According to a report issued by AMEInfo, the MasterCard Valentine’s Day Love Index analysed the pattern of spending in the Valentine’s season over the course of three years and showed that the Middle East region was generally found to be more likely to spend money on jewellery than any other region in the world, as about 23% of the spending for Valentine’s Day there was shown to be on jewellery.
In the UAE, jewellery made up 26% of the total spending on gifts, while flowers and cards accounted for less than 2% of spending. “Also in the UAE, 88% of MasterCard shoppers made Valentine’s Day purchases the traditional way in 2015, by physically going to a store to pick out a gift, while only 6% opted for online purchases,” according to AMEInfo.
Restaurants had the largest share of transactions made on credit and debit cards at 46%, followed by hotels at 37%. Spending on travel is increasing in the whole Middle East region, as 43% of transactions are made on hotels.
“From a global perspective, the Middle East region is the only one recording an increase in Valentine’s Day card purchases, a 107% increase year-over-year (y-o-y),” AMEInfo said.
With Valentine’s Day right around the corner, economies of many countries, especially the countries that are often relied on for the provision of the most demanded goods, will continue to benefit from the consumerism of the population worldwide on Valentine’s Day, in a pattern that seems to be here to stay.