Who Profits From Halloween?

Oct. 27, 2008— -- Imagine the now-famous Joe the Plumber's surprise when he was spoken to directly by the candidates in last week's third and final presidential debate. Now imagine how unsurprised he'll be each time he answers his door this Halloween and finds scores of trick-or-treaters who look just like him.

It happens every year: Someone's 15 minutes of fame happen to come in mid-October, making them an instantly popular Halloween costume. Of course, because it's an election year, there will be no shortage of Barack Obama, John McCain and Sarah Palin costumes. And retailers selling rubber masks and other topical Halloween costumes are ready to rake in the profits.

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While it's safe to expect a Michael Phelps or two, complete with eight gold medals (even if it is a bit chilly to be wearing just a Speedo at the end of the month), Hollywood is a major driver of Halloween costume trends as well.

Teen pop icon Hannah Montana should be a popular choice, not to mention any of the characters in High School Musical. Blockbuster films The Dark Knight and Iron Man are also fueling Halloween sales, with spending expected to reach $5.77 billion, according to the National Retail Federation (NRF). Total sales in 2007 were $5.07 billion.

"Hollywood has a tremendous influence over what adults, children and even pets wear on Halloween," said Tracy Mullin, president and CEO of the NRF, in a statement. While traditional costumes like witches, pirates and cats remain favorites among adults, 574,000 adults said they plan to dress up as a political figure, according to a survey conducted by NRF and BIGresearch, a market research firm.

Sarah Saves The Season

Sarah Palin rubber masks are difficult to come by since she was chosen as McCain's running mate so close to the start of the Halloween selling season -- which left manufacturers unprepared. But even though the masks had a late delivery at retailer Party City, stores can't keep them on the shelves, says Bill Furtkevic, vice president of marketing for the party supply store.

"While celebrities dominated Halloween over the past few years, this year there has been a lack of gossip in the news and lack of celebrity rehabs," says Todd Kenig, CEO of Ricky's, a New York City costume store. "So instead it's all about politics. Let's face it, if it weren't for Sarah Palin, things would be boring."

Ricky's also released a Joe the Plumber costume this week, just in the nick of time.

A Holiday For All Ages

Adults' increased involvement in Halloween is expected to help propel retail sales. This year, 51.8 million adults plan to don a costume for the night and the biggest spenders are those in the 18- to 24-year-old range. They say they will spend an average of $86.59 for Halloween preparations -- more than any other demographic spends, according to the NRF.

"Though the economy is struggling, Halloween sales may be a bright spot for retailers this fall," Mullin says. "Consumers -- who have been anxious and uncertain for the past several months -- may be looking at Halloween as an opportunity to forget the stresses of daily life and just have a little fun."

And with Halloween falling on a Friday, retailers anticipate people will be celebrating all weekend, which could result in the purchasing of multiple costumes.

While the next two weeks are most important for Halloween sales, specialty seasonal stores -- like Abracadabra Superstore in New York City and Spirit Halloween -- report that they are currently in line with last year's sales and are on target to meet expectations. Ricky's same-store sales are currently trending up about 5 percent, the company says.

But it is the discounters like Target and Wal-Mart who will be the biggest winners, says Eli Portnoy, chief brand strategist at The Portnoy Group, a marketing consulting firm. "The discounters are attracting customers who still want to enjoy the holiday but are looking for candy, decorations and costumes at value prices," he says.

Halloween spending patterns appear to be mimicking those of the 2002 recession, according to the NRF. Even though consumers at the time were uncertain about the economy, Halloween sales were on par with those of the previous year, with the average consumer spending $44.20 compared to $44.50 in 2001. The NRF expects to see some of the same patterns this year as the number of people who plan to celebrate is up, and consumers plan to spend moderately more than last year ($66.54 this year, compared to $64.82 last year).

"Americans may be giving up spending in many areas, but they still want to have fun," Portnoy says. "These little events are a way to escape the current economic woes. You can dress up and be someone else for a few hours."