U.S. Jewelers Brace for Valentine’s Day Without a Stimulus Boost
(Bloomberg) -- Americans won’t get their stimulus checks in time for Valentine’s Day, to the chagrin of the jewelry industry. So some stores are counting on lessons from earlier in the pandemic to carry them through one of the most vital days of the year.
Americans are expected to spend $21.8 billion for Valentine’s Day, down 20% from a record high last year, according to the National Retail Federation. On average, shoppers will shell out $165 on gifts and celebrations with their loved ones for the Feb. 14 holiday. About half of U.S. adults are expected to partake in festivities.
While sales of candy, clothes, flowers and greeting cards are all projected to fall, the jewelry category will be particularly hard hit. The NRF expects U.S. jewelry sales to fall nearly 30% to $4.1 billion. Only restaurants will fare worse, as Americans are expected to spend almost 40% less on evenings out.
Signet Jewelers Ltd., the owner of Jared, Zales and Kay Jewelers, is trying to overcome the contraction by leaning into the pandemic-friendly services it has built up over the past year, such as virtual consultations and curbside pickup. The company closed 2020 with a rise in domestic sales, and executives say the momentum has continued in the weeks before Valentine’s Day.
“It’s one of our most important holidays of the year,” Chief Executive Officer Gina Drosos said in an interview Wednesday. “We’re expecting to have a strong Valentine’s Day.”
Most jewelry stores can’t afford such tech investments, and face a tougher battle for Valentine’s Day shoppers. A majority of the heavily fragmented jewelry industry consists of small and independent operators that don’t have the budgets or logistical muscle of bigger corporations.
Jewelry executives had been hoping the federal government’s coronavirus aid package would arrive in time to lift consumer spending ahead of Valentine’s Day. But the relief effort has stalled as lawmakers haggle over the details.
“Hopefully we’ll see the stimulus checks come out mid-March,” said Drosos. “We expect some benefit from that when they come out, but we won’t see it for Valentine’s Day.”
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