Is Valentine’s Day Recession Proof?

The short answer to this initial question is probably – “yes, somewhat”.  Should an expected increase in 2012 Valentine’s Day spending be seen as a sign of economic recovery?  BizSinc thinks that’s getting a little crazy over the numbers and suggests that it is more than likely just a one-day vacation from the economic doldrums that most likely returned to most American households on February 15, 2012.

Nonetheless, Americans were expected to spend $17.6 billion on Valentine’s Day this year, according to the National Federation of Retailers (NFR) annual survey.  This figure equates to a roughly 12% year on year increase after a significant dip in 2011 vs 2010.  While $17.6 billion is certainly a large pile of cash, this hardly signals America’s return to prosperity.  However, it would place this year’s spend total at the highest in the last ten years.  The $17.6 billion translates to an average spend of $126.03 per person, reflecting an increase of 8.5% over prior year.  Any way you slice it, $17.6 billion buys a lot of roses, chocolate, and Hallmark cards!

In the chart above, 2007 and 2008 were included because they were considered pre-recessionary vs. 2011 and 2012 which are at minimum clearly “recessionary in nature”.  In other words, let’s agree here that we can at least say that “things haven’t been good lately”.  So, the survey results do indeed read like a baby’s breath of fresh air in an FTD vase.   Spending in a recessionary year is expected to exceed pre-recessionary levels, which would indicate that perhaps Valentine’s Day is truly a recession-proof retail institution where flower margins continue to soar regardless of the general state of the economy. While good within its own comparative scope, the NFR survey does also show that only 59% percent of Americans plan to celebrate Valentine’s Day this year.  While roughly in line with previous survey years, this stat tells us that we should continue watching the broader economic indicators.  That said, there’s nothing wrong with taking a fun look at this major seasonal impact in our nation’s economic calendar.

But wait…speaking of fun, here’s a fun Valentine’s Day fact to consider.

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About Thomas W. Smith
Bizsinc - Bringing Business to Life

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