Did social media spook Party City’s Halloween sales?
Party City said sales during the Halloween selling period came in lower than expected due to “two fundamental shifts” in the marketplace. The surprising one cited by the retailer was the rise of a do-it-yourself (DIY) costume trend as younger Halloween revelers look for more unique ways to dress up and display their creativity on social media.
On its third-quarter conference call last week, Jim Harrison, CEO, pointed to a survey from CompareCards by LendingTree that showed 48 percent of Millennials purchase Halloween articles so they can include them in social media posts. Thirty-seven percent of Gen-Zers and 30 percent of Gen-Xers said the same versus only five percent of Boomers.
Similar research from the National Retail Federation shows social media as a growing source of both Halloween inspiration and display. Mr. Harrison said, “There definitely is a do-it-yourself trend and we need to market and merchandise this trend more effectively.”
Party City plans to amplify costume accessories, which offer ways for DIY-costume makers to “mix and match” to support the trend. Mr. Harrison said, “We need to continue to build out this aspect of our portfolio, expanding the products available to consumers, to create their own unique costumes and images. More importantly, we need to do a better job of communicating our offering to these generations of consumers going forward.”
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He added, “We already have a larger more penetrated costume accessories business than our mainline competitors but we’ve not effectively used it as the competitive weapon that it is.”
The second major shift the chain mentioned was an increase in costume buying, including costume bags, being done online. The migration was expected, said management, and is “addressable” as Party City increases the emphasis of its accessories online and further capitalizes on BOPIS opportunities made possible with its store base. BOPIS represented 40 percent of consumer demand on partycity.com during October.
Party City officials stressed they don’t see any “systemic or a structural issue” with the Halloween holiday. According to NRF, Halloween spending has exploded from $3.3 billion to $9 billion over the last 15 years, and some years have showed declines. The industry looking forward to a boost in 2020 because Halloween lands on a Saturday.
- Party City Announces Third Quarter 2019 Financial Results; Total Revenue For Fiscal October 2019 – Party City
- Party City Q319 Earnings Call Transcript – The Motley Fool
- Nearly half of online fashion shoppers say social media inspired their last purchase – RetailWire
DISCUSSION QUESTIONS: Does it make sense that social media is driving a DIY Halloween costume making trend? What insights, if any, does the apparent trend offer into how social media may be influencing changes in fashion and other categories?