Valentine’s day – otherwise known as the day where millions of couples will buy the same red roses, the same box of chocolates, and book a table at the same special occasion restaurant in an attempt to shower loved ones with romantic gestures and gifts. As a result of the high demand, prices will skyrocket, and although that comes as no surprise, this year’s Valentine’s Day
is expected to reach $23.9 billion in economic activity! In other words, more than what has ever been spent on the year’s most romantic day! In this article, we are going to dive into the business side of Valentine’s Day, understand why we are spending more money on this day each year, and see what love day might look like ten years from now.
Consumers are overspending during Valentine’s day, in fact, the average American will spend $176 in gifts, that’s up from $164 in 2021. Although the amount spent during this holiday seems to be increasing every year, the amount of people actually celebrating Valentine’s Day is dramatically decreasing. A study has shown that only 51% of Americans are planning to celebrate the holiday, that’s down from 55 percent last year.
Why are we spending more money on Valentine’s Day if fewer people are taking part?
Even as the pandemic rages on, the economic activity during Valentine’s Day remains staggeringly high. Current events mean that talk of inflation is increasing. For over a decade, inflation has puzzled economists by staying low in both good and bad times. Since the global pandemic, central banks around the world have pumped money into the economy at a staggering rate hoping to avoid a global recession. Although this could be the answer to a post-pandemic recovery, with too much money in the economy chasing too few goods, prices are bound to rise. This might be the reason why Valentine’s Day in 2022 is expected to reach $23.9 billion in economic activity, more than ever before with less participation than ever before. What we so often forget, is that although inflation spikes may come and go, higher prices are forever. Lower inflation rates will only moderate the already existing higher base.
Valentine’s Day in virtual reality
Despite the increase in people taking a cynical approach to the holiday, many retailers are relying on the spike in sales that occurs each year during Valentine’s Day to keep their businesses going. In fact, with Metaverse becoming more popular, businesses are aiming to incorporate this new virtual reality to increase sales. It is expected to reach $800 billion by 2024. With staggering numbers like that it’s no wonder that companies around the world are changing their business model to fit a new reality of a metaverse future. Soon, the science fiction of the digital world will become a reality to us all, and that includes online virtual Valentine’s Day celebrations, which of course means new business opportunities for a lot of e-commerce companies.
Valentine’s Day is still known to some people as the most romantic day of the year while others dismiss it as a business holiday designed for florists, restaurateurs and retailers to get a rise in sales. Inflation means that we are spending more money on gifts for our loved ones despite the fact that less of us are actually deciding to celebrate this day. So what can we expect if we look at things in the long term? Perhaps Valentine’s Day will disappear and only be remembered as a profit-driven day designed for businesses, or perhaps, if metaverse does in fact become a social norm, we are looking at a whole new way to experience this romantic holiday – through a more virtual environment.
What can we expect Valentine’s Day to look like 10 years from now?
Opinions on where the metaverse will lead us to is still up for debate for many. Some believe that the metaverse economy will surpass today’s real-world economy, others believe that it’s just a fad and it will remain as a long-term idea. With businesses adopting new technologies, many companies will restructure their business model to continue to make big profits during this holiday. And if Valentine’s Day does in fact become a thing of the past, rest assured that as we evolve to an online, more virtual world, businesses will follow. In ten years from now, we might not be rushing to our local flower shop to buy a bouquet of red roses, or we might not be buying human-sized stuffed teddy bears, but we will continue to generate immense profits for companies that aim to target special occasions, no matter whether we are physically celebrating, or virtually
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