Mother’s Day spending subdued but daily deals to surge

Gift cards, coupons and daily deals are among the most popular ideas for Mother’s Day this year, as value-driven consumers reign in their spending after splurging on luxurious gifts in 2010.

According to market research agency IBISWorld, Mother’s Day spending will be somewhat subdued this year, forecast to increase just 1.2% from last year to $1.31 billion.

Last year, expensive flowerers, jewellery and cosmetics were the order of the day, with consumers inspired by renewed confidence in the recovering economy.

But IBISWorld general manager Robert Bryant says cautious consumer spending in 2011 will see a return to traditional favourites such as chocolates or less extravagant flowers, in addition to cost-saving coupons and gift vouchers.

IBISWorld expects the average person to fork out $58 for Mother’s Day this year, with jewellery spending to fall by 4.1% while cosmetics, perfume and toiletry spending will decline by 8.2%.

Clothing and accessories will also experience a drop in spending of 5.8%.

Meanwhile, chocolate and confectionary spending will rise by 8.1%. In a similar vein, spending on flowers will experience growth of 2.4%.

However, spending on gift certificates will experience the strongest growth, rising by 10.2% to $150 million, while spending on greeting cards will grow by 2.7%.

Bryant says online voucher providers will benefit the most from Mother’s Day this year, predicting a surge of business through daily deals on beauty therapies and spa experiences.

“The rapidly rising popularity of online group-buying and daily discount operators such as Cudo, Spreets, Ozsale, Catch of the Day and Star Deals is sure to catch the eye – and business – of cost-conscious consumers,” Bryant says.

“Whereas last year we might have splashed out and bought mum a top-to-toe treatment, this year budget-friendly buys will come up trumps with a facial or massage at 50% off much more likely.”

The daily deals phenomenon may also play a part in another popular Mother’s Day option – eating out – with bargain restaurant meals on offer.

According to IBISWorld, dining out represents a 10.6% share of daily deals within the group-buying and daily discount market, compared to retail’s 29.2% share and a 14% share for beauty.

Bryant says the sector is now fairly saturated, so new entrants will need to focus on niche markets such as fitness, restaurants and leisure.

Despite the growth of group-buying and daily discount sites, IBISWorld says eating out will account for the highest proportion of Mother’s Day spending this year, accounting for around 21% of total outlay. Families will spend an extra 4.9% on eating out to total $275 million.

Bryant says cafes and restaurants are always among the winners on Mother’s Day as “giving mum the day or night off” remains at the top of the list.

This article first appeared on StartupSmart, Australia’s top site for start-up entrepreneurs.