TRICKS OF TREATS

RICHARD TURCSIK

Retailers are scaring up extra sales of Halloween novelties by merchandising them in massive displays that also offer chocolates, toys and costumes.

The exhibits -- coupled with newspaper ads and a proliferation of novelty items from major manufacturers, including Hershey, Nestle, M&M/Mars and Tootsie Roll Industries -- are helping to build the category and win sales back from mass merchandisers, drug stores and other classes of trade, retailers told SN.

"We usually build Halloween displays that have the novelties tied in with the regular 13-ounce bags," said Lynett McCoy, candy buyer for Minyard Food Stores, Coppell, Texas. The displays are scheduled to go up today.

"We try to tie it into one big display, which also features general merchandise seasonal, including the costumes." McCoy added that Minyard uses a similar approach at Easter when it cross merchandises chocolate bunnies with Easter baskets.

Harps Food Stores, Springdale, Ark., has been increasing its Halloween novelty sales by 20% a year for the last three years by putting massive displays up early and selling the candies at competitive prices, according to Peter Jost, head buyer for grocery.

"We put our displays up early. We've become more aggressive pricewise because of the nature of where we are at with our department and our competition with Wal-Mart," Jost said. "Although our margins are still favorable, I would not say that they are acceptable. Halloween is the toughest promotion because that is when the mass merchandisers discount the deepest."

As a result, Jost said Harps has become more aggressive around the Halloween period in an effort to stop the erosion of sales to retailers like Wal-Mart.

"Halloween has become one of those situations where if we don't shore it up now, once it is lost it is hard to get back the business," Jost said.

Retailers in other areas of the country where Wal-Mart is not yet as strong a factor also find it beneficial to put the displays up early in the season.

"We always build a large perimeter display of Halloween candy seven to eight weeks in advance of the holiday, and we advertise the core Halloween products in our flyer," said Tom Yarrows, category manager at Big Y Foods, Springfield, Mass.

"Novelty candies are used to enhance the variety of the program, and these products are sold at full retail and contribute to profit. This has been a successful approach for us," he said.

Yarrows said the key to growing novelty sales is to find new and unusual items.

"We seek out new products each year. If an item performs well, we continue to purchase it for a future program," he said.

Big Y uses specific scan data to purchase seasonal products. It also follows all of the current trends and tries to keep its markdowns low, Yarrows added.

The addition of nonfood items to displays attracts adults to the category and improves overall sales, said Jan Winn, category manager of nonfood for Big Y.

"Halloween has become a very big piece of business over the last few years. It has moved primarily from a childhood holiday to an adult one. Sales of party goods, decorations for the home and alternative offerings to candy have grown tremendously," she said.

If Halloween falls close to a weekend, as it does this year, sales are even stronger, Winn added.

"With Halloween falling on a Friday we get the double benefit of the kids not having school the next day," Jost of Harps added.

Audie Waters, buyer at Autry Greer & Sons, Prichard, Ala., said his chain uses "massive displays" of Halloween candies to stimulate impulse sales and connote variety.

"We usually start putting our displays up during the first week of October and sometimes during the last week of September," he said. "People generally don't buy the Halloween candy if you put it out too early."

H.G. Hill Stores, Nashville, Tenn., merchandises Halloween candies from an off-shelf display, said Brian Ryckeley, buyer for the chain.

"Stores either put up a big table or a combination of several tables. It is located in the main aisle, and we do some decorations for it," he said.

Marshall Borman, direct-store-delivery buyer for Handy Andy Supermarkets, San Antonio, said his chain uses novelties in a massive display that involves products from several grocery vendors.

"There will be large displays that will most likely be tied in with another vendor, like Frito-Lay. They might build a 'spook-house-type' display with some of the other vendors. That will probably be going up at the end of September," he said.

Mike Shultz, senior vice president at Hughes Family Markets, Irwindale, Calif., said his chain finds early displays help to encourage repeat consumption of the novelty candies by consumers, thereby helping to reduce markdowns come Nov. 1.

"[Paying] more attention at store level to match demographic preferences during the order process is another way we try to limit our markdowns," he said.

Schultz said Hughes also places its displays in numerous locations throughout the store in an attempt to spur more impulse sales.

"Ghostly Glow Lollipops are this year's holiday showstopper," he added. "This item is not only a treat, but lights the way for safe trick or treaters, plus the handle turns into a haunted bracelet," he said.

As for other big sellers this year, Yarrows of Big Y also expects low-fat items to do well.

"This year, we expect the trend to be toward more healthy items, without fat content, including Marshmallow Peeps, popcorn balls, candy corn and M&M bags," he said, adding that chocolate products are also expected to perform well.

Meanwhile, Minyard's McCoy said entry of the big players into the novelty business is causing Minyard to pay more attention to the Halloween novelty items than it has in the past.

"When you have a company with a big name like Hershey or Nestle come in with more novelty or Halloween items, it gives our department a better overall look," she said.

McCoy said Minyard does more business in snack-size lay-down bags and count-goods.

"We also usually have something on the counter for the customers to buy to eat right then instead of having to buy a whole bag. Everybody always wants to eat something on the way to the car," she said.

The growth of the national-brand novelties has prompted Autry Greer's Waters to purchase more Halloween merchandise this year than in the past.

Handy Andy's Borman said manufacturers are now pushing more of the entertainment value of the product rather than the candy itself." He noted the candy portion of the products often tastes "terrible or pretty plain at best."

But Borman said he is using caution when ordering the items because many shoppers might be scared away when they see the higher price tags on these items.