8 Retail Lessons from the CEO of Spirit Halloween Stores
What will you go as for Halloween? Whether you dress up as Shrunken Head Bob from Beetlejuice, put on your Barbie pink, or choose the more traditional zombie scarecrow, costumes never go out of style. That’s why most people have spent at least a few frightening moments in a Spirit Halloween, the U.S.-based costume retail store that pops up for two or three months before the October 31 Halloween holiday each year.
Steven Silverstein WG85, CEO of Spencer Gifts and Spirit Halloween Stores, sat down with Barbara Kahn and Americus Reed, marketing professors at the Wharton School of the University of Pennsylvania, to share insider Spirit retail strategies. You can listen to the full episode on the professors’ Marketing Matters podcast.
Here are business highlights from the “Halloween headquarters:”
🎃 Spirit Halloween, which has 1,530 stores across the U.S. and Canada, is the only retail concept that tears itself down after October 31 each year and opens back up again the following summer – on a rolling basis, starting August 1. Silverstein and his team look at it as starting with a blank canvas, noting the current trends, and building from there. “We’re very intentional about the stories we’re telling,” he said, so you never quite know what you will get.
🎃 Different from other retailers, Spirit Halloween is all about the experience and the immersion. “We call it five senses retail. I want you to see it, I want you to hear it, I want you to smell it, I want you to touch it, and I almost want you to taste it,” observed Silverstein, a Wharton MBA. “That is the way Spirit thinks of our concept every year.”
🎃 An originator of the pop-up store concept or temporary retail, Spirit Halloween needs to be flexible, which requires work. “We have an ideal layout and formula, so we’re looking for big box stores, and we’re looking for visibility and those kinds of opportunities. But, depending on what space is available, we have to bob and weave,” noted Silverstein, adding that the company looks at four spaces for every one store that it rents to set up its annual retail locations.
🎃 Customer preferences require Spirit to take a unique marketing approach. “Whenever we talk about marketing and creating CRM (customer relationship management), the customer’s last purchase is usually indicative [of their next],” noted Silverstein. For us, we think, ‘You were a pirate last year, now what are you going to be?’ We’re so not interested in that specific element [of what you bought before]. We’re interested that you came and had a good time. I want to know who you are, and I want you to go into the store and have a good time…every year will be a different inspiration.”
🎃 Spirit Halloween, as a retailer, works to be tactile, engaging and interactive. “We want people to go [to our stores] as a social experience,” said Silverstein. “We want them to go in groups and post their experience online. This is the earned media we get (publicity or exposure that the company doesn’t have to pay for). We provide the backdrop, and [customers do the rest].”
🎃 Logistics look a little different, too. “We are a Halloween outlet right to the very end. Most seasonal stores are trying to exit their concept sooner, while we are fully in stock [until November 3],” said Silverstein. “Part of our model is that we carry over inventory from year to year and have to make sure we maintain that. We store it locally.”
🎃 Spirit Halloween exists in the gig economy. The company has more than 250 permanent employees, including buyers, operators, and people along its supply chain. “Then we have the next layer, which I call the field operators or district sales managers. There are 400-450 of those, of which about 75% come back to us every year, and they work from May to November,” said Silverstein. “They organize their world around coming back. Retired schoolteachers, retired retailers and artists…we are all about our frontline workers,” and they represent our stories and have a passion for Halloween.
🎃 Won’t this concept also work as a Christmas pop-up? Silverstein has heard that question before. And the company is considering Spirit Christmas. “We are purely testing things right now,” he noted. “Spirit creates a social experience for an event. Our brand is about bringing people into a hands-on environment. We’re talking about the way we used to shop for Christmas. We are going to have Santa in the stores. It will be the love and the humor that you find in Spirit. That’s the rationale. I’ll talk with you next year about how it goes.”
Conversation Starters
Have you had a unique retail experience at a Spirit Halloween or Spirit Christmas store? Share your story in the comment section of this article.
Have you ever worked in a Spirit Halloween store? Share your experience in the comment section of this article.
Steven Silverstein talks about the value of “earned media.” What does this concept mean and how do you think it is changing the retail business?
Ask him about the “consignment operators” who built the Spirit brand for him for over 30 years and why he chose to terminate them at his will with zero compensation or notice
Dig deeper and look at the lawsuit just filed in California ….
I have always loved the retail experiences in Spirit Halloween due to their interactive products. However, I have never worked at a Spirit Halloween.
An experience I will remember forever was when I was ten, shopping for my new Halloween costume. As soon as I walk in, BOOM! the mechanical spider with bright red eyes jumps at me and I scream across the whole store.
I have never worked in Spirit Halloween, but I applied to a popup store near me that was only open for October and my availability was not what they wanted.
“Earned media” is a phenomenal way to target audiences more precisely. It refers to the publicity a company gets organically rather than from paid advertising. I think the retail businesses that focus more on customer experience and standing out, will have more “earned media” in the future.
I found this type of business very interesting. They are closed for most of the year, and open up for just three months. However, the way they make money is highly efficient in terms of costs and marketing.
First, Spirit Halloween can keep the expenditure low because they are operating for a short period of time. Numerous expenses such as wages and rent costs are reduced to minimum as they don’t spend those money when they are closed. Furthermore, the business exists in a gig economy where businesses can quickly hire someone when demand rises. This is really important to them as it increases their financial flexibility; they can hire more when needed, they don’t have to if stores aren’t busy. This structure ensures that the business is running efficiently in terms of finance.
Second, their marketing through earned media is also effective. Think about it; you could spend millions of dollars on a TV commercial or you pay nothing while someone is pitching your product/ business for you. This is something Spirit Halloween excels in that they don’t rely on conventional marketing that most of the businesses do. Spirit Halloween doesn’t spend millions on marketing; instead they leave the marketing for people who post their experience on social media. Their pictures will be an incentive for many to visit the store, which is the ultimate goal of their marketing.
For those ideas mentioned above, I think Spirit Halloween is one of the most efficient business models that we see today.
I grew up in Vietnam and I had not experienced big festive retail extravaganzas such as Halloween or Christmas, but I could still feel a big difference as an exchange student in Michigan last year. Halloween products surprisingly came out so early that it was preposterous to say the least, and that was a good thing because I could feel the very exciting atmosphere the sales produced. My part was best when it came to candy sale hunting spree with my host family where all products were at 50-70% off. For Christmas, we had to drive around for decoration shopping starting from right after Thanksgiving, and here’s a retail lesson I saw my host family retail employers in action. At the same chain, some stores have much better deals than others.
I have not personally worked at a Spirit Halloween shop, but I am in no way unfamiliar to Halloween retail. Even though Halloween has become widely celebrated in Vietnam recently, if I did have to work in one for example, I could easily imagine. I’d picture myself doing simple and regular retail work such as assisting customers, smiling at kids to get them in the good mood, helping to create people’s halloween dreams as they’re coming to the costume store.
Earned-media is publicity a brand receives due to some public interest and will be “earned” if they actively spread word-of-mouth. An example is when I buy from you online and I take and edit pictures of my Halloween costume for other friends to see in my social media, as well as review your store in Google to the world. The earned-media phenomena is so powerfully revolutionizing the retail business because it is the most trustworthy word-of-mouth publicity possible and it is significantly free. You are no longer telling your customers and potential customers about your brand, you are instead indirectly being told by other people just like you (so much easier to convince). Seasonal is a good example: How many people have you met who know of “Home Alone” as a Christmas classic? Did they watch it year after year because Spirit Halloween bombarded the marketing all throughout November? Hardly, they most probably saw the movie and simply enjoyed it and loved it and it just became common knowledge for all of Christmas time as people shared the nostalgia and fun of the movie. Earned-media allows you to easily and often very inexpensively target large numbers of people more effective than conventional marketing.
When I see the creepy skeleton wizard guy giving me a wink as I drive past a strip mall or what used to be a Bed Bath & Beyond, I know the Halloween season is upon me. I’ve never actually stepped inside a Spirit store, but somehow it still feels like a tradition. Last Halloween, my friends and I seriously considered getting matching Spirit costumes to dress up as Chipotle orders, like their signature foiled burritos, chip bags, or napkins. The idea came straight from an Instagram reel that my friend sent on our group chat. That’s earned media in action, and it totally worked. We were all pumped to dress up as something goofy, but sadly we ended up going as Star Wars characters.
What makes Spirit so clever is that it’s more than just a costume shop. It turns forgotten real estate into an immersive playground where you feel the Halloween spirit. Even people like me, who’ve never crossed the threshold, know the brand’s vibe instantly. It’s part nostalgia, part chaos, and part haunted house energy. Spirit basically lets customers do the marketing for them; it’s low-cost, high-impact, and weirdly iconic.
That’s why I’m actually intrigued by the hint at Spirit Christmas. If Spirit can pull it off with the same humor, chaos, and five-senses immersion that made Spirit Halloween a cultural moment, it could work. It taps into the craving for real-life experiences again. The kind where you walk through something, laugh with your friends, and post about it after. If Spirit can bring that kind of social energy to Santa’s season, they might just reinvent how we shop for the holidays. That way, next year, my friends and I get to become Chipotle menu items in the fall and maybe even buy crazy Chipotle inspired ugly Christmas sweaters in the winter.
Growing up, finding halloween costumes was a matter of procrastination in our family. As a kid, I obviously wanted to go trick or treating, but there were no stores that actually had the costume I wanted since we were looking the week before. The shelves had been cleared and I would not be able to be the witch I always wanted to be. For me, Halloween costume shopping was never really an experience. Now, more than ever, there is no experience at all. Ever since everything went online, many people just don’t feel the urge to go in person to get a costume. Currently, a study by PwC shows that “64% of U.S. consumers and 59% of all consumers feel companies have lost touch with the human element of customer experience.” Shopping has become so transactional that we forget to enjoy the true experience.
That’s what intrigues me about Spirit Halloween. They don’t just sell these costumes, but they create a story and memories for the shopper. Steven Silverstein’s approach of the “five senses retail” is truly genius—something I have never heard of in the retail space. His fascinating method to appeal to all the senses truly makes the shopper love shopping at his store. Spirit Halloween embraces this captivating concept, and invites customers to shop and have fun.
When shoppers enjoy shopping, they are more likely to come back and buy more. According to Harvard Business Review, when companies start to connect with the emotions of the customers, they are likely to have a huge benefit. According to Forbes, a study conducted by Capgemini found that “70% of emotionally connected customers spend more than twice as much with the brands they’re loyal to and that emotional engagement with consumers could drive a 5% uplift in annual revenue.” This shows that emotional engagement truly does benefit companies. One example can be shown by Harvard Business Review, where they found that when a company introduced a new credit card through emotional connection, use among the segment increased by 70%. Emotional connections are necessary so the shopper feels as they belong and feel connected to the store. These dedicated customers are not just enjoying themselves, but talk and post about their experiences too. Through earned media, Silverstein uses the memories he creates to help fuel his own marketing. The customers are not just helping market Spirit Halloween, but are also creating their own valuable bonding experiences for friends and family too.
Out of all the thought-provoking strategies that Spirit Halloween uses, its most admirable is their ability to stay seasonal. Being open only for 3 months a year, most businesses would not be able to generate enough revenue and disappear. However, Spirit Halloween proves that it is most definitely possible—they show that it’s not about the amount of time a store is open, but rather the impact that the store creates on the shopper.
I believe more companies should develop a similar approach to Spirit Halloween’s. With more than 95% of customers’ decisions on purchasing products made subconsciously, it is essential businesses focus on the emotional aspect. Businesses should not just focus on selling at all moments of the year, but rather focus on having a true influence on the customer. By focusing on creating better experiences instead, more people would shop at the store and it would result in higher profits in the long run. I believe many modern brands are missing this emotional aspect, and are not willing to take the risk to improve it. But when there are so much data and statistics that show the experience of the shopper matters, it is time more businesses take a leap and try to implement it. More companies should follow the lead of Spirit Halloween to truly make shopping a more engaging journey.
Sources:
https://www.forbes.com/councils/forbestechcouncil/2020/02/28/emotional-connection-2020s-biggest-cx-trend/
https://hbr.org/2015/11/the-new-science-of-customer-emotions
https://www.forbes.com/councils/forbesbusinesscouncil/2024/10/11/subconscious-persuasion-how-brands-can-appeal-to-consumers-emotions/