Paid clicks on ads across Google-owned sites and its advertising network jumped 33% during the quarter.
Valentine’s Day is shaping up to be another big holiday spending day.
Valentine’s Day online shopping doesn’t get anywhere near the attention from researchers, the media and even many retailers as the Nov. 1-Dec. 24 holiday shopping season. It’s a shopping period, though, that should not be slighted: Feb. 1-14 is like a mini-Christmas shopping season, an especially sweet one for online flowers, candy, jewelry, gifts and cards merchants-but one with its own challenges.
“Valentine’s Day is unique,” says Neil Kugelman, CEO of online jewelry merchant Goldspeed.com. “Most gifts for Valentine’s Day are bought by men. Most gifts for Christmas are bought by women. Women have foresight and start their shopping earlier. Men forget and put it off. We find it to be a very, very last-minute holiday.”
Based on Valentine’s Day experience in previous years, Goldspeed.com braced itself for late shoppers and, in fact, both its traffic and order volume peaked on Feb. 12. With the support of a robust fulfillment system, Goldspeed promised and delivered on Valentine’s Day delivery on orders taken up to 6 p.m. Feb. 13, says Kugelman.
Goldspeed was certainly not alone in handling a rush. For the week ending Feb. 11, consumers spent $24.5 million online on flowers and greeting cards, compared with the $12.4 million average of the preceding four weeks, and $24.7 million on jewelry, compared with the $20.3 million average of the preceding four weeks, according to comScore Networks Inc., a research firm that specializes in consumer behavior.
That amounts to $49.2 million in web sales, which does not include other Valentine-oriented retail categories such as candy and gifts. However, it also does not include intent; the figures represent only total product sales, not products specifically intended as Valentine’s Day gifts.
Surprisingly, most research firms with a large focus on web retailing don’t track Valentine’s Day web sales. They may be missing the boat, some experts say. This year, for example, the National Retail Federation’s 2007 Valentine’s Day Consumer Intentions and Actions Survey, conducted by BIGresearch LLC, reports that consumers expected to spend an average of $119.67 for Valentine’s Day, up from $100.89 last year. With 63.4% of consumers planning to celebrate the holiday, total 2007 Valentine’s Day spending was expected to reach $16.9 billion.
On the web, Valentine-related site traffic peaked Feb. 12, conversion rates Feb. 5 and online sales volume Feb. 6, according to “Searching for Love: Valentine’s Day Online Retail Buying Trends,” by search engine marketing firm Oneupweb. The study is based on data reported by 12 of the company’s retailer clients that are large Internet-only or catalog/Internet merchants. Oneupweb restricted the study to retailers of Valentine’s Day-oriented products that offered shoppers special holiday-themed promotions online. The aggregate data includes traffic, conversion and sales figures from nearly 300,000 unique e-commerce site visitors.
Worrying about delivery
The unusual disparity among the three metrics-especially sales peaking Feb. 6, six days before traffic’s zenith on Feb. 12, then plummeting four days before traffic topped off-stems from procrastinating or forgetful shoppers’ worries about on-time delivery, says Lisa Wehr, president of Oneupweb. “Valentine’s Day shoppers seem to do a lot of research before converting; conversion peaked only one day before sales did,” she says, noting that traffic’s second highest day was Feb. 5, the highest day for conversion. “But many shoppers hadn’t made a holiday purchase come Feb. 7, and when shopping online after the 7th they feared they could not get gifts shipped on time.”
Some retailers, like Goldspeed.com and rival online jeweler Ice.com, though, used their ability to fulfill last-minute gifts as a marketing hook, promising shoppers they could get their gifts on time. At Ice.com, sales continued strong right through Feb. 13. “Men do most of the buying, and they’re procrastinators. So we have to offer them last-minute shipping options,” says Shmuel Gniwisch, CEO.
Gniwisch reports that Ice.com’s sales were up 100% over last year’s, with sales starting in late January. He attributes growth to “100 different things,” but cites Valentine Buying Guides on Ice.com and Diamond.com as major factors.
Contributing to Goldspeed’s double-digit sales increase for this year’ holiday over last year was an on-site Valentine’s Day gift guide, and a marketing strategy that layered Valentine’s Day offers into weekly e-mails to customers starting four weeks out instead of closer to the holiday, culminating in an all-Valentine’s Day e-mail the week before Feb. 14.
Second only to Moms
Another merchant that takes the Valentine’s Day online shopping period seriously is 1-800-Flowers.com Inc., where Valentine’s Day is second only to Mother’s Day in sales. Because Valentine’s Day is so important to it, 1-800-Flowers.com takes a special approach to site design and marketing for the holiday. 1-800-Flowers.com launched a revamped e-commerce site aiming to create an improved and more easily navigable shopping experience. On Jan. 15, the day its Valentine’s Day shopping period began, 1-800-Flowers.com debuted the Valentine’s Day Gift Center.
The gift center served as the starting point for all Valentine’s Day specials and content. Once in the gift center, shoppers could use a site search tool with special Narrow Your Search features to hasten and focus the gift-buying process. The gift center also included a Virtual Bouquet and a viral Video Valentine in which customers could make a video using available photos or uploading their own and adding text.
At DelightfulDeliveries.com, a gift basket retailer, CEO Eric Lituchy prepared for Valentine’s Day with some judicious online ad spending, focusing more attention than last year on pay per click programs at two small gift-specific shopping portals, Gifts.com and FindGift.com.
DelightfulDeliveries.com cut back on paid search spending at some of the larger engines, saying that they either hadn’t contributed much last year, or that the cost of getting a high ranking had become too high to be profitable. For example, Lituchy says he reduced his ad spend on Google for the two weeks leading up to Valentine’s Day to just over $11,000 from last year’s $35,000. Though he spent less on online advertising than last Valentine’s Day, changes in where he spent his ad dollars boosted his return on ad spend to 500% this year from 200% last year. Average order size was up 6% over last year.