Will Consumers Have a Spooktacular Halloween?

pirateHalloween is big business. It is the second-largest commercial holiday, with Christmas being the first. The celebration is filled with candy, costumes and lawn decorations. It also offers adults a chance to escape reality for a night. This year, more people are expected to take part in Halloween than ever before.

According to a recent National Retail Federation consumer spending survey conducted by BIGinsight, a record 170 million people plan to celebrate Halloween. The study finds that 71.5 percent of Americans will get into the Halloween mood, compared to 68.6 percent last year. Consumers are also not afraid to spend more. The average American is estimated to spend $79.82 on decorations, costumes and candy, an increase from $72.31 in 2011. Total Halloween spending is expected to reach $8 billion.

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When it comes to finding costume ideas, the majority of people still find their inspiration from retail stores such as Wal-Mart (NYSE:WMT) or Target (NYSE:TGT), along with specialty costume shops. Nearly 36 percent will look for ideas in stores, while 33.3 percent will find ideas by using online searches engines like Google (NASDAQ:GOOG). More than 15 percent will scroll through Facebook (NASDAQ:FB), and 7.1 percent through Pinterest. Among people buying or making costumes, the average person will spend $28.65 on costumes this year, up slightly from $26.52 in 2011. Yahoo (NASDAQ:YHOO) data shows that pirates are a top costume choice this year, according to Business Insider.

While an increase in spending may be taken as a positive sign for the economy, the study was conducted in early September. Thus, the effects of hurricane Sandy are not reflected in consumer moods.

The Superstorm is wreaking havoc on the East Coast with damaging winds, floods and life-threatening storm surges. Chris Christie, the governor of New Jersey, may even sign an Executive Order to reschedule Halloween in the state. However, the majority of spending was expected to be completed in the weeks leading up to Halloween.

“By the time Halloween rolls around each year it’s safe to say Americans have already spent two months preparing for one of the fastest-growing and most widely-loved holidays of the year,” said NRF President and CEO Matthew Shay. “Retailers know that when it comes to Halloween, new costume ideas for children, adults and pets, and the latest in home and yard decor top people’s shopping lists.”

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