Projected at $8.4B
There’s no reason for retailers and suppliers to be scared this Halloween. The National Retail Federation predicts explosive sales reaching as high as $8.4 billion, with the average American consumer spending $82.93 on costumes, candy and décor.
“After a long summer, families are excited to welcome the fall season celebrating Halloween,” Matthew Shay, president and CEO of NRF, said in a statement. “Retailers are preparing for the day by offering a wide variety of options in costumes, decorations and candy, while being aggressive with their promotions to capture the most out of this shopping event.”
Some analysts have pointed out that part of the reason for the increase in Halloween spending is likely connected to the number of adults who celebrate the holiday. In addition, the sharing of costume and entertaining ideas on social media has spurred consumers to try and outdo each other in holiday creativity.
Halloween is also a unique holiday in that it is primarily devoted to fun and enjoyment, rather than family, religious or patriotic obligations. Neighbors offer up inexpensive candy in exchange for visits from costumed children. Adults and older teens dress up in elaborate get-ups and enjoy parties with friends. Family dynamics and gift-giving etiquette aren’t a factor in enjoying the holiday.
Still, Halloween isn’t a time for businesses to relax: According to a recent article in Chain Store Age, 27 percent of consumers in the United States plan to start Christmas shopping before November, creating urgency for retailers who want their share of these sales.
In the piece, Traci Gregorski, senior vice president of marketing at Market Track, said: “Beating other retailers to the punch by taking demand out of the market early is nothing new. Look for early digital sales to kick off the season in earnest with compelling deals in October to entice consumers to shop early.”
Discount Stores Expand into
New Markets, New Formats
For years now, the media have been raising the alarm about the decline of brick-and-mortar shopping. Yet new reports indicate that things may not be as bad as they seem. Some retailers continue to expand their traditional stores at a steady clip.
In a recent “top 10” report by CoStar, discount stores dominated the list of new square footage in the second quarter of 2016.
Perhaps not surprisingly, Wal-Mart Stores Inc. ranks number one with 15 million SF, but the list also includes Dollar General, Family Dollar, DollarTree, Marshalls and T.J. Maxx.
The reason for the popularity of discounters may be due to a combination of price and product mix. After all, Walmart and the dollar store chains tend to sell everyday staples for which consumers often have an immediate need. When waiting for delivery isn’t an option, being able to run around the corner to pick up the item is important.
Even as discounters are expanding their overall square footage, the size of newer stores is, in some cases, shrinking. The Tribune article notes that the new urban Dollar General locations are as much as 20 percent smaller than the size of a “typical” store.
For suppliers, the change may represent opportunities and challenges: Shelf space and smaller stores will be at a premium, possibly resulting in tighter supply chain compliance rules. On the flipside, greater demand for low-priced products may benefit vendors that specialize in this niche.
Food Suppliers Face
Growing Senior Population
In the quest for the millennial dollar, food suppliers shouldn’t ignore seniors. This growing demographic has money to spend on food, but marketing to this population, particularly baby boomers, can be a tricky business.
According to the Department of Health and Human Services, in 2014, people aged 65 and over made up 14.5 percent of the U.S. population. By 2040, this demographic is expected to grow to 21.7 percent. That’s a lot of opportunity. But it’s also a challenge. Businesses must understand the needs of this market while also having the sensitivity to connect with a population that is growing older but doesn’t want to be reminded of this fact.
The first consideration is knowing just what particular needs seniors might have when it comes to food and nutrition. Easy-to-read packaging might be appreciated by those who don’t want to have to put on their reading glasses before microwaving their lunch. Also, seniors who have specific nutritional needs or have difficulty swallowing may need specific, targeted products such as liquid supplements and powdered thickeners.
Still, there usually isn’t a need to call out a consumer’s age when developing a marketing program. In a recent article by Niamh Michail on BeverageDaily.com, Michail cites L’Oréal’s decision to use models from different age groups in their advertising in hopes of broadening the appeal of its products.
“This ‘one-size-fits-all’ marketing approach may not be as challenging to pull off as it first appears in terms of foods or ingredients, because what appeals to seniors is not so far removed from what appeals to younger demographics,” according to the article.
The fact that some older people may need easily-opened packaging or vitamin-enriched foods doesn’t mean that they think of themselves as “elderly.” An approach of promoting benefits while avoiding stereotypes may be the best strategy for suppliers that wish to earn their share of this market over the next several decades.