Americans are perhaps feeling more romantic in addition to feeling more confident about the steadily improving economy.
Research by three organizations serving the community-based financial institution (FI) industry reveals Valentine’s Day-related purchasing was way up in 2015. The Members Group (TMG) found credit spending increased 21 percent, and CO-OP Financial Services and Saylent Technologies, Inc. (Saylent) found debit spending increased 16 percent for the three days culminating in Valentine’s Day compared to 2014.
The 21 percent increase in credit spending is based on transactions made from Thursday, Feb. 12 through Saturday, Feb. 14 by users carrying credit cards issued by TMG’s FI clients. TMG’s analysts attribute this to healthy growth in credit card portfolios of TMG’s clients and the fact cardholders used their credit cards on average 3.5 percent more this year as compared to last year. The analysis is via the card processor’s proprietary analysis tool, ClearTrend. The tool can provide similar data on a per-FI basis for the processing clients of TMG.
TMG also found at that while Millennials (age 18-29) made 58 percent more transactions than the next closest age bracket, they spent far less. Millennials spent an average of $39.09 – 65 percent less than the next lowest age bracket (age 30-39). In addition, out of the three days, the day before Valentine’s Day (Friday, Feb. 13) saw the most credit transactions – 9.3 percent more than Feb. 12 and 5.7 percent more than Feb. 14.
During the same Thursday through Saturday period, CO-OP and Saylent found a 16.45 percent increase in debit card spending. The results covered debit activity at all of the merchant types that Saylent tracks nationwide by members of credit unions that use CO-OP for transaction processing. The year-over-year comparison was performed through an advanced analytics solution, CO-OP Revelation, powered by Saylent, and was conducted by Saylent’s FInsights360 consulting team.
CO-OP and Saylent additionally found that people used their debit cards more this year when buying loved ones products to help them check off their “honey-do” lists and better their homes. This is reflected in an almost 38 percent increase in transactions and close to 49 percent increase in spend at home supply warehouse stores.
The two companies also found that consumers used their debit cards more to go out for romantic dinners and drinks, with a more than 33 percent increase in transactions and 47 percent jump in spend at restaurants, and a 79 percent increase in transactions and more than 79 percent increase in spend at bars compared to last year during this time period.
You can read the full report of findings on Valentine’s Day shopping 2015 here.