Valentine’s Day: Is it a Ripoff or Not?

February 18, 2010

My mother will be disappointed to learn this, but I once told a valentine not to buy me flowers on Valentine’s Day, and if he must, not to buy me roses. Despite Mom’s best efforts, my practical nature sometimes gets the better of me. I know roses cost more around February 14th, and I just can’t tolerate the price hike.  

Last week, reading articles and advertisements for Valentine’s Day meals, I was of course was glad to see restaurants projecting positive sales. But I couldn’t ignore the economics of it, and wondered how others view the business of Valentine’s Day dinners. And if you’re reading this, you probably know that I conducted some well-timed research to find out what people think à la the rip-off factor. To everyone who responded to the survey, thank you, and here is the skinny.

I surveyed colleagues and friends via Facebook, Twitter, and emails asking them to respond and recruit others. So while it’s not a random sample, it’s relevant for my purposes. It ran from Thursday night, February 12 until the morning of February 14th, when I had reached 100 responses – 103, actually.  I have to say, I enjoyed learning about others’ views of the occasion via the non-price-related questions, but as a pricing nerd, I care most about the views on costs and value. So without further ado:

  • 40% of respondents believe prices are more expensive on Valentine’s Day than other nights of the year
  • 33% believe prices are similar to those on other nights
  • 20% don’t know or aren’t sure
  • 4% think prices are discounted on this night
  • 5% responded “other,” noting specials and pairings that are available, with no note as to expense

Big aha: more people think dining out on Valentine’s Day is similarly-priced or cheaper than other nights than think it’s more expensive. Restaurateurs, I am happy to be the bearer of good news.

Is Valentine’s Day a special occasion worth the splurge? Is it a hassle to go out for Valentine’s Day? Respondents rated these affirmative statements on a 6-point scale where 1 means strongly agree and 6 means strongly disagree:

  • For both statements, the average score was 2.9
  • No answers were given for either statement in the disagree range of 4 to 6

So people value this occasion and are willing to put up with the crowds, pressure, opportunity to be exploited, and mandatory fun (their words, not mine) because they appreciate the time with their loved one, adult conversation, dessert and lack of dirty dishes (as reported in open ended questions). Again, operators, rejoice!

One Restaurant’s Point of View

To understand the restaurant perspective, I spoke with Byron Lepine, Manager at Kingston Station, a downtown Boston lunch favorite of mine. I had received an email with their V-day specials – a $50 3-course prix fixe menu, $70 with wine pairings. Byron sounded like the host with the most as he described the restaurant’s philosophy. “We want to make sure guests have a memorable evening and go home feeling good about it.” He waxed poetic about the planning and regretted not repeating last year’s late-night anti-V-day party for singles this year.

Lepine knew his menu inside and out, explaining that both customer favorites and special items were among the selections. When he mentioned that one of the items was a $26 entree, I was quick to ask how $24 for a first course and dessert meant a value, and he quickly recited the value and economics behind their meals. He clearly does his homework. “What you pay for an entree doesn’t reflect the food cost. We have a terrible [cost] on skirt steak and should probably charge $35 or $40,” though it’s less. “We eat the cost.” He used the example of the Valentine’s Day special prime rib, a $36 entree, along with two $9 courses, for the $50 package. While I don’t consider a couple of dollars a bargain, his points about the fair market price are well-taken. And those of us in the biz know that not all items’ profitability is created equal.

Side note: I reviewed the restaurant’s typical prices for items on the Valentine’s Day menu, and using these to calculate V-day value is a bit less favorable than using Lepine’s reference points of what the restaurant “should charge.” My calculations do not, however, include the factors he mentioned, like fresh flowers and special atmosphere, as well as the difficulty of handling many more tables in a night. And as we say, value is not just price. And as we also say, the laws of supply and demand hold true, so as demand goes through the roof on Valentine’s Day, it’s fair that prices do, too. So while the wise consumer in me has a narrower view around the pricing, the businesswoman in me says Kingston Station is conducting smart business.

I also asked Byron about the wine pairing, thinking that the extra $20 would not be such a bargain, but when he told me it was a glass of wine with each of the 3 courses, I knew that was a good deal. He estimated $9 price tags for the wines selected. I don’t know about you, but I often see them for more than this. Indeed, many wines on Kingston’s menu are $8 and $9 a glass. So I like that math. And while Kingston’s menu suggested the wine for each course, the restaurant would not hold guests to the recommendation, adding to the value quotient. This left me with a good feeling about Kingston’s wish to spread the good feeling.

A Diner Weighs In

My optimism was tempered when I learned that the warm glow of a Valentine’s value was sadly lacking by a friend who visited a suburban Boston restaurant on this auspicious occasion. Her summation: “Last night’s dinner was the biggest f-*^ing rip-off, it was ridiculous.”

The culprit? Prix fixe menus. This restaurant, like Kingston Station, required guests seated at tables to order the prix fixe dinner, which is how restaurants increase their checks on this night o’ couples. However, my friend noticed that the restaurant allowed those at the bar to order à la carte, which ended up being less money for the same meal served as a “special.” Her dinner deal was a $75 ticket, and she calculated that ordering the selections separately “didn’t even come close to $75.”  Her reaction: “I think I now will officially spend both New Year’s Eve and Valentine’s Day dinner at home. I loved spending the evening with my guy, and the food was good, but it was ridiculous how it was priced.”

So what can I conclude from these various sources of data? If you’re in the camp that wants to splurge, or you don’t mind the hassle, or you can finish 3 courses and 3 glasses of wine, the deals may feel better. If you are restaurant catering to a house full of two-tops, you have to earn your money and manage the crowds, but luckily their price/value perceptions are in your favor.

And if you’re me, you get to take surveys and observe it all in the name of work!

A Few More Survey Findings:

  • 47% of respondents prefer to go out, while 34% prefer an evening at home; 15% want to treat it like any other night
  • Fine dining is the winner for those who want to go out, preferred by 41%, while independent restaurants claim 35% of respondents
  • Respondents who prefer a night at home overwhelmingly want to make a special meal, with 66% opting for this choice; the next most popular option: takeout at 10%
  • 60% of respondents were women, 35% men, and 5% did not indicate their gender.

2 Responses to “Valentine’s Day: Is it a Ripoff or Not?”

  1. Sharon Says:

    Great story. The results were eye-opening to say the least. Thank you

  2. Leslie M. Says:

    Great summary Leslie! Thanx for sharing!

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