Deck the malls

Holiday decorations are serious business for retailers

By Ann Hoevel
CNN

Dazzling holiday decorations and children waiting to see Santa helps Asha Hope from Illinois get into the spirit of the season when she's shopping for gifts.

"I like the decorations in stores and to see the kids when they get excited. That puts me in the holiday spirit," she said.

Hope's reaction is just what retailers and property management groups are hoping for, as the holiday shopping season is traditionally responsible for a large chunk of yearly retail sales.

"We would like to think that holiday décor brings out the child in everyone," said Fred Schwam, CEO and owner of American Christmas Decorations Inc., a New York-based holiday decorations company.

Retailers and mall owners hire companies such as American Christmas Decorations Inc. to design and install holiday decorations to put shoppers in the holiday mood.

Simon Property Group, Inc. works with holiday décor companies to deliver a sense of wonder to customers at its malls and shopping centers to remind them of the holiday season, said Cathi Weiner, senior vice president of business development for Simon Brand Ventures.

Wally Brewster, spokesman for General Growth Properties, another mall and shopping center management group, said malls use decorations, music, special entertainment and charity sales during the holiday season to create a festive environment.

"When you go into a shopping environment, especially one of our malls, we want you to feel like you're escaping and you're in this holiday experience," he said. "It gets you excited about the season of giving."

Holidays affect retailers all year
The holiday season is the busiest time of year for retailers. According to the National Retail Federation, shoppers in the United States spent a total of $414.6 billion during the 2004 holiday season. The federation predicts holiday sales will jump by 5 percent this year. Holiday sales account for 25 percent to 40 percent of many retailers' annual sales, which is why the industry focuses so intently on this time of year.

"Most retailers work on the holidays year-round," said Dan Butler, vice president of retail operations for the federation. Retailers will begin setting up their holiday decorations as soon as the end of October, but by February they're already working on next year's holiday season, he said.

Large stores, such as Saks Fifth Avenue and Bloomingdales, will spend 30 percent to 50 percent of their overall budget on holiday decorations. "It is definitely the single largest expenditure out of the whole year," said Steven Wilburn, president of Holiday Image Inc., a holiday décor design and installation company.

"People definitely spend millions of dollars just getting their flagship stores ready for the holiday season," he said.

With so much money and man-hours invested in holiday decorations, how can retailers tell if they're making a difference for shoppers?

Saks Fifth Avenue used a snowflake-theme marketing and décor plan for the 2004 holiday season when Wilburn was the store's creative director for visual merchandising. The large, multimillion-dollar plan featured a snowflake light show that repeated every 15 minutes on three sides of Saks' New York flagship store.

"It just drove tons of traffic into the main floor, " Wilburn said. "Every 15 minutes you could see people leaving the show and coming into the building," he said.

Holiday decorations will attract customers to malls and shopping centers in the same way. Weiner said the decorations in Simon malls, although they don't change as often as in large stores, keep people coming back and staying longer. Brewster said the decorations in General Growth malls help to establish a "brand loyalty" that keeps people coming back.

Winter's winning design
Although the holiday shopping season encompasses religious and cultural holidays, retailers' decorations do not center on religious imagery. They opt for traditional, winter-related ideas such as snow, winter plants and animals, candy, gifts, and non-religious characters like Rudolph the Red-Nosed Reindeer and Frosty the Snowman.

For their 2005 season decorations, Bloomingdale's is using holiday flowers, such as peonies, amaryllis, poinsettias and roses, combined with pine branches. "It evokes the holidays without speaking specifically to any one holiday," said Joe Cotugno, operating vice president of visual merchandising for Bloomingdale's.

Weiner said Simon malls will take their winter-theme designs one step further and tailor them to the community. Last year Simon's Stanford Shopping Center, in Palo Alto, California, created a holiday décor that reflected the habitat of northern California, incorporating Sequoia trees, black bears, rock formations and forest sounds. Haywood Mall in Greenville, South Carolina, last year featured a holiday installation of a replica historical home, and the mall continues to schedule activities and events surrounding that home.

Decorating too early?
Stacy Isbell from Decatur, Georgia, said she looks forward to seeing holiday lights go up this year, "But they put the decorations up way too early."

Butler disagrees. "They haven't started earlier in years," he said, defending retailers against perceptions that they decorate earlier and earlier each year. Retailers will begin setting up decorations in late October so that they will be up by the time holiday television ads air and holiday sales begin, he said.

Brewster said General Growth malls begin to decorate for the holidays sometime from the end of October to the weekend before Thanksgiving, and they make sure the decorations are down before New Year's Eve.

Weiner said Simon mall décor goes up in time to coincide with the Santa set. A staple feature in malls across the country, photos with Santa are nostalgic for adults and exciting for children. Decorating so early before Christmas "keeps it so customers are not in horrendous lines for Santa photos," she said.

Visiting Santa is one way many parents choose to kick off the holiday season, said Butler. "It's about the experience they want to give their children."