• by Jonty Kelt , February 9, 2012

With more than 200 million roses produced for Valentine's Day (according to online floral merchant Organic Bouquet) in 2011, and nearly 200 million cards shared between paramours (according to Hallmark Corp.), it's pretty evident that the holiday tugs the heartstrings of Americans everywhere. 

But that's not all -- according to the National Retail Federation's 2011 Valentine's Day Consumer Intentions and Actions Survey, it seems to be pulling their purse strings as well: Men, on average, spent $159 in 2011, and women came in at roughly half that number ($76).

These figures are drawn from the results of the NRF 2011 Valentine's Day Consumer Intentions and Actions Survey, conducted for NRF by BIGresearch. The survey was developed to measure consumer behavior and shopping trends that are related to Valentine's Day. This consumer poll of 8,913 consumers was conducted from January 4-11, 2011, with a margin of error of plus or minus 1.0%.

With total holiday sales possibly exceeding $16 billion in 2012, those of us in the e-commerce industry are looking back on 2011 to determine how local businesses --  particularly those in the service space -- can position themselves most effectively to boost sales. Which businesses do best by extending discounts during Valentine's Day? Do exclusive tasting menus at fancy restaurants sell? And exactly what are men and women looking to buy for each other (and -- as it turns out -- for themselves)?

Read on -- some of the lessons might surprise you!

When you're in love, everything's better:   In 2011, there was an average offer performance increase of 180% during the holiday. Broadly, this highlights the size of the opportunity available for businesses during Valentine's Day. By simply choosing to run an offer at the right time, potential revenues are nearly doubled, regardless of the product or service type.

If you've got something to sell, celebrate:   Shopping and product offers outperformed ARPO (average revenue per offer, our standard measure) by 9.8x. Compared to the standard increase in performance of 1.8x, those offering discounts on products should be more aggressive in making offers – as opposed to those selling services (such as spas and restaurants). Beyond the obvious (such as flowers, candy, chocolates), gifts of a sentimental nature -- such as picture frames -- also performed well above average.

Self-love is the greatest love of all:  One example of a strong performer was an offer for 50% off $40 worth of merchandise at Babeland, a chain of female-focused adult stores. This deal ran on a curated lifestyle guide for young women, demonstrating the power of matching the right offer with the right audience at the right time. Of course, when the offer was conceived, it was done so under the assumption that it would do well -- but not quite as well as it did. This reinforces the value of experimentation for e-commerce providers, and is a good reminder that resonance with the consumer is a moving target.  

Purchasers are up late -- for the right deal:   Eighty percent of those buying the Babeland deal made the purchase between the hours of 12 a.m. and 4 a.m. -- a critical reminder that timely promotion of certain deals (via SEM, display ads, etc.) can make all the difference -- alongside contextual content targeting the late-night shopper. 

What's yours is mine:   Tasting menus and date specials (like couple's massages) are notoriously difficult for local businesses (such as restaurants and spas) to promote, as they often lack the online assets and 'reach' to do so. E-commerce provides an incredible vehicle to leverage the audiences of big publishers, allowing local businesses to take advantage of market forces once that were only accessible to bigger brands. 

Taken together, these findings can form the foundation of a strong merchandising strategy for your business this Valentine’s Day. Holidays have always been a source of major revenue for retailers, and e-commerce participants now have access to powerful analytics that provide the data necessary to deliver the right offer -- to the right customer -- at the right time. It’s a welcome development for all involved, and one that’s certainly in keeping with the spirit of the forthcoming holiday -- celebrating that special someone (with something)!