This Halloween, home retailers will be cashing in
Retail Watch | Sep 28, 2023
For retailers, it’s a long way from back-to-school to Black Friday in a year when many have struggled with inflation pain, overstocked inventories and a flat economy. Thankfully, there’s a little island of opportunity right smack dab in the middle of fall: Halloween.
Home furnishings stores are no exception, with some surprising new research showing that home decor products are now the second-most purchased items for the holiday. As a result, all kinds of retailers are aggressively going after this business, from Home Depot to lifestyle chains to discounters.
Halloween has been celebrated in one form or another in America since the mid-1800s, but its place as one of the biggest events on the retail calendar is a relatively recent shift. And with estimated sales this Halloween season projected at a record $12.2 billion, according to the National Retail Federation, retailers continue to find new ways to scare up even more business.
Those NRF projections are astonishing on several levels. The association is forecasting almost a 20 percent jump in overall sales versus last year, which was also a record. Their survey says 73 percent of all consumers are expected to participate in Halloween, at least to some extent, and that’s up from 69 percent last year. Per-person spending will be just over $108, with candy being the number-one buy, but about half of the survey respondents say they will be decorating their home and/or yard.
If all of this sounds like just what the doctor ordered for retailers who have not exactly been ringing up their registers, then get yourself another bag of Reese’s Pieces.
The wild card in this year’s season is Party City, which has traditionally done a huge business for Halloween. After going into Chapter 11 bankruptcy in January, there was much speculation on whether the big retail chain would survive the process. But unlike so many others that crashed and burned—Bed Bath & Beyond, Tuesday Morning, Christmas Tree Shops, to name a few recent victims—Party City emerged earlier this month, down about 60 stores but still with more than 600 locations.
Party City’s main competition in the specialty business is Spirit Halloween, which is owned by Spencer’s and has perhaps the most unusual business model of any retailer in America. Every year, starting in August, it opens more than 1,000 pop-up locations, runs them for a few months, then packs them all up after October and hands back the keys to its landlords.
This year, it plans to hire about 40,000 employees and open about 1,500 locations, a record, utilizing what is still an excess of retail real estate—the result of all of those out-of-business bankruptcies mentioned earlier. Spirit Halloween’s aggressive business plan this year—it says it is the largest Halloween retailer in the country (and it’s hard to argue with that)—plays into the NRF forecasts about a strong season.
One of the more unexpected guests at the Halloween retail party has been Home Depot. The chain has rolled out an exterior decor item that has become a signature: a ghoulish “statue” that seemingly grows bigger every year. This year, there are four giants (the smallest of which is 12 feet tall), ranging from skeletons to ghosts to an unidentified object that would look at home in a Stephen King novel. Not only are they not for the faint of heart, but they are not for the short of cash, either, priced in the $300 to $400 range. Such is the demand that Home Depot specifies “one to a customer,” following sellouts in previous years.
The how-big-is-my-scare movement has now spread to many other retailers, ones not necessarily thought of as go-to-Halloween stores. Take Ikea, which has a line of 44 Halloween-themed items this season. Even CB2, the otherwise stylish lifestyle retailer, is getting into the act. In a promotion, it told customers it had “everything you need for a hauntingly cool Halloween tablescape,” including, but certainly not limited to, a pair of snake-shaped bookends.
As a calendar-related promotional event, Halloween has a pretty good life span. You might have still been looking for suntan lotion or a beach towel, but retailers were knee-deep in all things orange. But since retailers never met a season they didn’t want to be late to, Thanksgiving—yeah, we know they call it “Harvest” now—is well into motion, and we already saw our first Christmas promotion not too long after Labor Day.
If you’re a little kid, Halloween can be a little scary. If you’re a retailer, Halloween is also scary … scary good.
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Warren Shoulberg is the former editor in chief for several leading B2B publications. He has been a guest lecturer at the Columbia University Graduate School of Business; received honors from the International Furnishings and Design Association and the Fashion Institute of Technology; and been cited by The Wall Street Journal, The New York Times, The Washington Post, CNN and other media as a leading industry expert. His Retail Watch columns offer deep industry insights on major markets and product categories.
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