E-tailers scare up nice Halloween profits
NEW BERLIN, Wis. — Jalem Getz used to dislike the lack of seasons in his native California. Now he uses the extreme seasonality of the Halloween business to turn a big profit.
Getz, 33, founded online business Buycostumes.com in a warehouse in the Milwaukee suburbs in 1999 to take advantage of Wisconsin’s central U.S. location and cheap rent.
Being an e-tailer also meant not having to open a retail space for just two months of the year, or stock other items. Money saved on storefronts goes to maintaining a stock of 10,000 Halloween items – 100 times what most retailers carry for the season.
“Our selection sets us apart,” Getz said. “A lot of customers are looking for unique. … And by having that large selection we immediately build that additional goodwill.”
After nearly doubling in size for each of the last two years, Buycostumes.com is now the nation’s biggest online seller of costumes, and was ranked recently in Inc. magazine as the 75th-fastest growing U.S. private firm, with revenue of $17.6 million last year and three-year growth of 1,046 percent. Sales this year are expected to hit $25 million to $28 million, Getz said.
Other online Halloween firms are also predicting double-digit growth this year — compared with a 5 percent gain to a record $3.3 billion for the entire industry, according to a forecast by the National Retail Federation.
“I think it is a good indication that Buycostumes.com has a superior retail model,” Getz said.
The site sells costumes such as Darth Vader, Raggedy Ann and Cinderella in kids, adult, plus and sometimes pet sizes and the array of capes, swords and masks is mind-boggling. Prices can range from $6.99 for Ozzy Osbourne glasses to a near-original Darth for $798.99.
Celebrate Express Inc., a Kirkland, Wash., online and catalogue retailer, revamped its Costumeexpress.com site this year after a successful test launch last year, and expects Halloween sales to jump more than 35 percent to make up a tenth of its expected $84 million to $87 million in annual sales.
“I think it’s the convenience factor and just being able to find what you want,” said marketing director Katie Manning. “You don’t necessarily have to go to a store and hope that they have the Star Wars costume your child’s dying to wear for Halloween in the correct size.”
Even bricks-and-mortar Halloween giant Spencer Gifts LLC – which opened some 350 temporary Spirit Halloween Superstores in North America, up from about 260 last year – launched Spirithalloween.com this year to broaden its reach.
Spokesman Mike Champion said the two sales channels have helped feed off each other.
“Many of our guests are using this as a shopping tool and making purchases online, but they’re also using this as a browsing tool for their end purchase in a store,” Champion said.