Nothing Scary About Predicted Halloween Spending

NRF: Sales Will Grow 14% for Holiday; Only 2.2% for Christmas Season

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NEW YORK (AdAge.com) -- In a holiday role reversal, Christmas is looking spooky, while Halloween appears to be downright cheery.
About 65% of consumers plan to celebrate Halloween, compared to 59% last year, according to NRF's annual Halloween Consumer Intentions and Actions Survey.
About 65% of consumers plan to celebrate Halloween, compared to 59% last year, according to NRF's annual Halloween Consumer Intentions and Actions Survey. Credit: AP

Downturn or no, the National Retail Federation today reported that more consumers plan to celebrate the haunted holiday -- and, on average, plan to spend more for it than last year. Overall, Halloween sales are expected to rise 14% to $5.77 billion, while holiday sales are predicted to grow by only 2.2% (or only 1.5%, according to TNS Retail Forward).* In a macabre kind of twist given the gloomy economy, it seems shoppers are happy to spend on Halloween even as the industry predicts a dire Christmas season.

About 65% of consumers plan to celebrate Halloween, compared to 59% last year, according to NRF's annual Halloween Consumer Intentions and Actions Survey, conducted by BIGresearch. The average consumer will spend $66.54, up from $64.82 last year. Those aged 18-24 will spend the most on Halloween, at $86.59 per person.

Easier to justify
"In general, there's a bit of a backlog, when someone has spent the last nine to 10 months only buying necessities, only focusing on items they can get at great prices," said Ellen Davis, VP at NRF, noting that the group was surprised by the results. "It really has to do more with the mind-set of the shopper. In a lot of ways Halloween and Christmas are really different. We're talking $40 or $50 vs. $800 or $900. It's a lot easier to justify."

And because of that, price might not be as much of an issue. Retailers, however, continue to be in value and promotion mode, regardless of the event. Already, Kmart is promoting costumes at 15% off, Target is touting "spooky savings" and Wal-Mart is advertising kids' costumes for as little as $20.

Halloween Spending 2008
Category Spending per person Spending total
Costumes $24.17 $2.1 billion
Candy $20.39 $1.77 billion
Decorations $18.25 $1.58 billion
Greeting Cards $3.73 $320 million
Source: National Retail Federation

"After months of bleak economic news, consumers are looking for a reason to let loose," said Phil Rist, VP-strategy for BIGresearch. "And with Halloween on a Friday this year, consumers may plan to celebrate all weekend long."

Ms. Davis said the survey has a 1% margin of error. The NRF has been conducting the survey for about six years. Consumer spending on the holiday has been increasing steadily during that time, despite the encroachment of Christmas. Since 2003, spending on Halloween has nearly doubled, from $2.96 billion to an estimated $5.77 billion this year. Along with that, there has been a 10% jump in the number of consumers getting into the Halloween spirit, and they, on average, are spending $25 more per person than they did just six years ago.

Seasonal mish-mash
Still, a number of retailers, including Target, Costco and Macy's, are stocking Halloween and Christmas merchandise in tandem. Because the holidays fall so closely together, retailers often simply fill shelves with Christmas goods as soon as Halloween products sell out, creating a mish-mash of seasons.

"Some retailers really benefit from Halloween and others see it as a blip on the radar on the way to Christmas," Ms. Davis said. "Many retailers want to allocate shelf space to Halloween and fall, but Christmas is still the bread and butter of retail. If Halloween fell in May or June, it could be an absolute blowout for retailers."

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UPDATE: An earlier version of this story had not included the NRF's prediction for the holidays, only the TNS figure of 1.5%.
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