Valentine’s Day has become big business, offering small-medium enterprises the opportunity to increase revenue at the start of the year after the Boxing Day and January sales have subsided. This has meant that SME businesses need to adapt their supply chain processes to ensure that they capture their share of the consumer spend for Valentine’s.
Consumer spend on Valentine’s Day in the UK for 2019 was estimated to be £1 billion and is set to rise in 2020. This is a huge opportunity for SME businesses, whether that business is an online company or a bricks and mortar store. We’ve compiled some of the key areas to think about adapting to engage your customers for the day of love.
Increase stock that counts
In 2019, it was estimated that 52% of consumer spending for Valentine’s Day was for candy purchases with the second-largest spend estimated at 35% for flower purchases. 267 million pounds was forecasted to have been spent on flowers in 2019 where the highest demand for floral orders begins three days in advance. This means that traditional and online florists need to factor these timings in when deciding how much additional stock to have and when to replenish. Or consider how they work with their end suppliers to manage demand.
We spoke with Florismart, a WorldFirst customer who is a leading online flower marketplace where multiple suppliers are brought together in one webshop. From that webshop, British and German professional florists buy their flowers, plants and foliage at the best price. Florismart begin their preparations six months before Valentine’s Day working with their suppliers to ensure that the enormous spike in demand for red roses is met and that budding romantics across the UK and Germany get perfect petals on the big day. This planning process includes forecasting, quality control checks and extension of delivery dates – no leaf is left unturned!
Florismart uses a tried and tested drop-shipping business model with blooms shipped from grower to florist to ensure freshness and also the lowest possible logistical costs. Not needing to store and maintain stock brings great cost efficiency to the operation and that translates to a very meaningful competitive advantage. Florismart is more than a webshop, they offer florists an extensive support system, investing in education and have created a community of florists and growers – they are a business which WorldFirst is truly proud to support.
Refine your marketing
So how does your marketing on and offline change? For Florismart, always having a keen eye on a date like Valentine’s to support how you update your marketing is the first step, noting that “British floristry knows three big peaks, Christmas, Mother’s Day and Valentine’s Day. Valentine’s Day is generally a crazy time because everyone wants red roses. This puts extra pressure on growers, logistics, florists and our marketplace. Just think of doing a month’s work in just one day, that is Valentine’s Day in the world of flowers”.
It is important to have a specific plan outside of your ongoing marketing efforts. This preparation should consider key numbers, for example, approximately 28% of 2019 purchases were made online. Which means there is an opportunity for SMEs to make vital changes to their website and it’s supporting online advertising well before Valentine’s Day. In Florismart’s case, they use some of the following marketing hacks:
- Increasing their email newsletters, tailoring the content around Valentine’s day
- Sending their customers promotional information at the end of Summer on pre-ordering flowers to create buzz and a sense of urgency with customers
- Tailoring the messaging they use in their Facebook community to support targeted product updates, special deals specific to the community they have been cultivating
- Focusing mainly on Facebook but also using Instagram, focusing more on consumers for this channel
Figuring out which tactics and channels to adapt is another way to not only prepare to engage your consumers in a targeted way but when doing so, have a clear idea of which channels work best for your business.
Updating your website and marketplace ads
Preparation is key for trading peaks like Valentine’s Day. Reviewing your website to ensure the web pages feature the right product messaging (with relevant benefits or features which are attractive to your customers) with the right targeted keywords is a good way to drive more of your shoppers to buy more of your products.
Along with adding specific call-to-action buttons across the web pages where it makes sense in your customer’s web journey to drive consumers to order your Valentine’s Day led products. Valentine’s Day is a great opportunity to increase the customer-centric messages you share with your audience.
Payment and FX
It is essential for any SME trading internationally to work with an FX specialist who can optimize foreign currency operations. Where Florismart is concerned, “financially we have to make sure that we have enough funds based on our budget/forecast and we wait for the most favourable exchange rate using the WorldFirst’s market order facility”.
“We use Worldfirst because they offer the best exchange rate. We have been trading with Worldfirst for over 4 years. We started with 3 brokers, comparing their rates online and WorldFirst consistently offered the best exchange rate and we have since dealt exclusively with WorldFirst.”
Choosing the right FX specialist is key to managing costs associated with cross-border payments, as Florismart goes on to say “we’ve found that there are many advantages to using WorldFirst, such as online real-time rates, their fast and timely service, being able to use their user-friendly and secure portal, having the savings on huge bank fees and last but not least, having a dedicated broker”.
SMEs need to closely manage their bottom line in periods like Valentine’s Day to maximise the opportunity. An example of preparing to manage potential costs is highlighted by Florismart who say “like most businesses, tight margins are crucial to us. On an amount of £100,000, the price WorldFirst provides compared to a bank could easily be a difference of £2000 – this equals approximately 2 pallets of flowers or 100 flower boxes!
“We transact a large volume of GBPEUR around Valentine’s Day, so the market orders are our tool to ensure we achieve the best exchange rate. Within our business, the margins are tight, with the help of market orders we get to keep the flower prices competitive for our independent florists”. Market orders give our customers additional control of the exchange rates they achieve. It may be that to adhere to your annual budget rate you are targeting a rate higher than what is available in the market. A market order will automatically trigger even if the rate is only momentarily achievable in the market, meaning you don’t need to spend time monitoring rates manually.
Putting your business in the best position to seize your part of the increase of sales for a day like Valentine’s Day takes planning and working with the right partners and specialists. In Florismart’s case, placing market orders with WorldFirst and using the WorldFirst platform to pay international suppliers bypassing the bank meant huge savings on bank fees, faster lead times and of course better FX rate. All of which supported how they get their supply chain ready to transfer the love to their customers and ultimately, their revenue pots.
You too can prepare for Valentine’s Day, just order your Valentine’s bouquet from a local independent florist through Florismart.