This Day On The Street
Continue to site right-arrow
ADVERTISEMENT
This account is pending registration confirmation. Please click on the link within the confirmation email previously sent you to complete registration.
Need a new registration confirmation email? Click here
Stocks Under $10 with 50-100% upside potential - 14 days FREE!

Halloween Keeps Ringing the Bell, But No One's Answering

PORTLAND, Ore. ( TheStreet) -- Yes, you've been seeing seasonal aisles full of Halloween candy, decorations and costumes in stores and supermarkets since at least Labor Day. No, it's not doing a single thing to boost Halloween's profile among retail holidays.

According to the folks at market research firm IBISWorld, Halloween spending in the United States is expected to grow to $7.63 billion this year from $7.41 billion in 2010. That's impressive when compared with the $5.77 billion U.S. consumers spent on Halloween at the beginning of the recession in 2008, but just less than half of the $13.2 billion spent on Father's Day this year.

Among the retail holiday heavy hitters, Halloween ranks dead last behind Christmas ($69.2 billion by IBISWorld estimates), Valentine's Day ($20.8 billion), Mother's Day ($17.1 billion), Father's Day and Thanksgiving ($7.8 billion). Think Turkey Day's spot is looking ripe for the plucking thanks to Black Friday's encroachment on Thanksgiving dinner? Nope. Halloween's 3% year-over-year growth lags well behind Thanksgiving's 6.4% growth in 2012.

Fluctuating commodities prices have more than a little bit to do with Thanksgiving's annual take, but weather-dependent Halloween has plenty of its own variables. This year, Halloween has the grave misfortune of sharing its run-up sales period with a lingering government shutdown. With roughly 800,000 federal workers sent home, 2.1 million civilian contractors also furloughed and government money locked up tight, few people are feeling particularly flush this season. Halloween sales with still grow, but that growth is just a costume for some telling spending cuts.

"We expect strong growth in the decorations category because they are a small and inexpensive way to get into the holiday spirit," says Nikoleta Panteva, senior analyst for IBISWorld. "However, overall spending is expected to be suppressed due to the ongoing economic and political uncertainty, causing consumers to cut back on highly discretionary spending."

Spending on decorations is expected to jump 6.7%, to $2.23 billion. Costume spending, however, will increase by a relatively flat $40 million, or 1.5% from the $2.72 billion spent last year on the holiday's biggest category. Hershey (HSY), Tootsie Roll (TR), Mondelez (MDLZ) and other confectioners won't see much of a boost from candy sales, either, as last year's $2.19 billion in spending crawls to $2.25 this year -- a change of less than 3%.

Even the biggest retail holiday proponents are measuring their Halloween expectations this year. The National Retail Federation retail industry group notes that while a third of U.S. Halloween consumers did their shopping by the end of September, the overall size of that buyer base and the amount it's spending have shrunk this year. Roughly 158 million consumers say they plan to celebrate Halloween this year, down from 170 million last year. In total, they plan to spend about $75 each on Halloween, down from an average of nearly $80 per shopper last year.

Even the NRF's estimated Halloween spending total is relatively modest at $6.1 billion, trailing IBISWorld's figure by more than $1.5 billion. Keep in mind, this is coming from a group that represents just about every major retailer in the U.S. and has a vested interest in seeing them do well. It's also from a survey in which people are only asked how they expect to spend money around Halloween this year. It's not so much a gauge of actual spending as it is a barometer for how consumers are feeling about potential spending.

While the NRF places the blame for this year's slump with "cooler fall weather," it's more likely that the aforementioned political and economic insecurity is spooking consumers and retailers alike. That NRF Halloween spending estimate is still 54.7% higher than it was in 2005, a quarter of U.S. consumers (25.2%) say the state of the economy will affect their Halloween spending plans. Nearly nine in 10 (86.1%) will spend less overall, up slightly from 83.5% last year. Additionally, 32.7% will buy less candy and 18.1% will make a costume instead of buying one. That affects retailers from Wal-Mart (WMT) and Target (TGT) to Kroger (KR) and Safeway (SFY) .

At a time the balance of Halloween spending is shifting toward adults -- with the $1.2 billion U.S. consumers plan to spend on adult costumes overshadowing the $1 billion they'll spend on kids' outfits -- there should be more money in the Halloween goody bag than ever. At least this year, however, a stagnant economy and equally intractable Congress are the scariest elements Halloween has to offer -- and consumers have lost enough to both already.

-- Written by Jason Notte in Portland, Ore.

>To contact the writer of this article, click here: Jason Notte.

>To follow the writer on Twitter, go to http://twitter.com/notteham.

>To submit a news tip, send an email to: tips@thestreet.com.

RELATED STORIES:



Jason Notte is a reporter for TheStreet. His writing has appeared in The New York Times, The Huffington Post, Esquire.com, Time Out New York, the Boston Herald, the Boston Phoenix, the Metro newspaper and the Colorado Springs Independent. He previously served as the political and global affairs editor for Metro U.S., layout editor for Boston Now, assistant news editor for the Herald News of West Paterson, N.J., editor of Go Out! Magazine in Hoboken, N.J., and copy editor and lifestyle editor at the Jersey Journal in Jersey City, N.J.

Select the service that is right for you!

COMPARE ALL SERVICES
Action Alerts PLUS
Try it NOW

Jim Cramer and Stephanie Link actively manage a real portfolio and reveal their money management tactics while giving advanced notice before every trade.

Product Features:
  • $2.5+ million portfolio
  • Large-cap and dividend focus
  • Intraday trade alerts from Cramer
  • Weekly roundups
TheStreet Quant Ratings
Try it NOW
Only $49.95/yr

Access the tool that DOMINATES the Russell 2000 and the S&P 500.

Product Features:
  • Buy, hold, or sell recommendations for over 4,300 stocks
  • Unlimited research reports on your favorite stocks
  • A custom stock screener
  • Upgrade/downgrade alerts
Stocks Under $10
Try it NOW

David Peltier, uncovers low dollar stocks with extraordinary upside potential that are flying under Wall Street's radar.

Product Features:
  • Model portfolio
  • Stocks trading below $10
  • Intraday trade alerts
  • Weekly roundups
Dividend Stock Advisor
Try it NOW

Jim Cramer's protege, David Peltier, identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.

Product Features:
  • Diversified model portfolio of dividend stocks
  • Alerts when market news affect the portfolio
  • Bi-weekly updates with exact steps to take - BUY, HOLD, SELL
Real Money Pro
Try it NOW

All of Real Money, plus 15 more of Wall Street's sharpest minds delivering actionable trading ideas, a comprehensive look at the market, and fundamental and technical analysis.

Product Features:
  • Real Money + Doug Kass Plus 15 more Wall Street Pros
  • Intraday commentary & news
  • Ultra-actionable trading ideas
Options Profits
Try it NOW

Our options trading pros provide daily market commentary and over 100 monthly option trading ideas and strategies to help you become a well-seasoned trader.

Product Features:
  • 100+ monthly options trading ideas
  • Actionable options commentary & news
  • Real-time trading community
  • Options TV
To begin commenting right away, you can log in below using your Disqus, Facebook, Twitter, OpenID or Yahoo login credentials. Alternatively, you can post a comment as a "guest" just by entering an email address. Your use of the commenting tool is subject to multiple terms of service/use and privacy policies - see here for more details.
Submit an article to us!

Markets

DOW 18,053.71 +23.50 0.13%
S&P 500 2,088.77 +6.89 0.33%
NASDAQ 4,806.8590 +33.3870 0.70%

Brokerage Partners

Rates from Bankrate.com

  • Mortgage
  • Credit Cards
  • Auto

Free Newsletters from TheStreet

My Subscriptions:

After the Bell

Before the Bell

Booyah! Newsletter

Midday Bell

TheStreet Top 10 Stories

Winners & Losers

Register for Newsletters
Top Rated Stocks Top Rated Funds Top Rated ETFs