The 13th Month of Revenue

Phillip: Welcome to spooky commerce. I'm skategurt. The podcast at the intersection of cryptacular commerce.

Brian: You've been waiting all year to do that.

Phillip: I have.

Brian: This is your favorite series that we do.

Phillip: It really is.

Brian: Let's be honest.

Phillip: Welcome back, uh, to the show. Sarah Rolette, producer Sarah. This is your second year back for spooky commerce. Can't wait to see what you have in store for us.

Sarah: Thanks. Thanks.

Phillip: You've been doing a lot of research.

Sarah: I have. Yes. Um, I love this stuff. I've been hyper fixating on different pieces of lore and conspiracy, and I'm very excited to jump into spooky season.

Phillip: This season is like we're in the thirteenth month of revenue. Yep. Is that that's how you would characterize it. Uh, give us a little bit more about why October is the thirteenth month on the retail calendar.

Sarah: Well, so the thirteenth month of revenue is actually a quote from, like, a former CEO up high in Universal Studios. Um, and it refers to them discovering that their way out of the theme park slump in fall, so post summer, pre holiday, was to lean into Halloween. But I think a lot of other businesses are probably catching on. Spirit Halloween operates over 1,500 pop ups every year. Halloween, I think, in my mind, as, you know, just a consumer and observing the market, it makes a lot of sense that people lean into Halloween to kind of fill in that, like, area of the year that would otherwise be a slump. I think there's a lot of examples of that, but I think theme parks do it best, personally.

Phillip: Halloween Horror Nights in particular is its own season that, like Pumpkin Spice season, starts earlier and earlier every year now.

Brian: True.

Sarah: True. They're almost up to I think they're at, like, forty eight nights of Halloween horror events this year.

Phillip: How much more can we milk out of that?

Brian: A lot, apparently. It's the second biggest retail holiday after Christmas.

Phillip: I I see that in our in our prep sheet. According to the National Retail Federation, it's $12,200,000,000 of retail spending, and that was as of 2023, and that makes it the second largest. That's right. Second biggest retail holiday after Christmas. Total sleeper, Halloween.

Sarah: Let's jump back in time to 1955. Disneyland has opened in Anaheim. Walt Disney himself is overseeing the project. It's a huge feat. And, naturally, shortly after this, about nine years later, Universal Studios in Hollywood sees the opportunity to expand their tour program into an amusement attraction based experience. So Universal Studios in Hollywood officially opens in 1964 as a theme park. Both of these theme parks got their start in California, as most people know. But in the early sixties, Disney set its sights on Central Florida. They buy tens of thousands of acres of land, and Disney World opens in 1971. I just think that is a little interesting because Universal was sort of following suit behind Disney in terms of, like, launching these parks. They watched the success of Disney World in Orlando, and then Universal Studios in Orlando didn't open until 1990. But where Universal really flipped and leaned into their strengths was, I think, with Halloween. It only took Universal Studios one year to recognize. We're sitting on the licensing rights of tons of classic monsters, tons of classic movies. That's kinda what the theme park was all about is introducing people face to face with these characters that they see on screen. And Disney was a little too family friendly to really lean into, like, the gore and the fright of Halloween season. So I think it was only natural for Universal to really kick that into gear one year in in Orlando, and that's what they did.

Sarah: So in 1991, they get the idea to launch. This is the one and only year, it wasn't called Halloween Horror Nights, was the first year. It's called Fright Nights. They did a three night Halloween event, um, with just a few attractions, you know, kind of I think they had one haunted house. They invested, like, not a ton of money. It was a bit experimental, but very quickly snowballed into, you know, what we know today as you can imagine. This first year that Fright Nights was around, one ticket cost just over $12 a person. Wow. So not the $90 tickets that we know today. It made, like, local news was, like, not that big of a deal, but by 1992, they had invested a million dollars in park work. They built sound stages. They redecorated rides, and they rebranded officially to Halloween Horror Nights. So this brief experimental phase was, like, cool for the locals. And then by '92, they were like, okay. We're rocking and rolling. And from then on, every year, they added nights. So the second year it was happening. It was a five night event. We [00:05:00] within a decade, they were hitting almost twenty nights, and now, you know, we're almost at the fifty night mark.

Brian: That's crazy. Huge.

Sarah: I know.

Phillip: Huge nights. That's wild.

Sarah: I think Universal does a good job, and, you know, similar parks as well who have, like, leaned into the same model do a good job at ranging their houses from super scary to not that scary, integrating pop culture. You know? I remember one year I went, there was a Stranger Things house that was not the most impressive house of the night, but the line was like a three hour wait just because Stranger Things was so big. So it's it's so easy to tap into, you know, all of those different angles and age groups and demographics.

Phillip: I'm putting you on the spot. Any ideas, like, what were some of the early activations or early themed experiences there? And and are there, like, ones that are mainstays that have sort of carried over year to year?

Sarah: Yeah. Every year, you know, they'll they'll reactivate houses that do really well. In the beginning, they really leaned into the classic monsters. You know, part of the excitement of this is the the long term park goers wait for the house list every year, and usually it gets leaked. It's kinda like an album release almost. Like, it'll get leaked around July, June. Like, people are speculating. There's Instagram pages where people are following and kind of voting on, like, what they wanna see. And they'll obviously work on these houses all year. And then when the list hits, it's there are there's always a few, like, classics that are kind of pulled or or revived or, you know, like classic monsters that will hit.

Brian: Well, and some of these movies have cult followings, and so it's you're you're pulling on, like, different little subgroups every time you you pick one of those classic movies.

Sarah: Okay. The first haunted house they had in '91 to '92 was called Dungeon Of Terror. It was the only haunted house that they featured during Fright Nights. I mean, it returned the next year for Halloween Horror Nights two, and they were located in the Jaws queue. Interesting. Also, the Jaws ride was a great ride.

Phillip: Okay. From a commercial perspective, I think this is something I I really wanna touch on. The way that this factors into the the thirteenth month, right, the thirteenth month is that you're selling a second ticket for a single day. Disney has gone on to do similar things for, like, the Christmas parties or the not so scary Halloween parties. They do a very similar thing where you're basically truncating the normal ticket holder day to kick people out of the park so that you turn the whole park over for a very short run for another group of people to come in and maximize a shorter window for a a prorated ticket, but a very expensive premium ticket where they're they're going to spend probably more than they would normally, um, to really immerse themselves and have a deeper experience. And I think, you know, while they're not there for as long, there's a larger amount of opportunity for merch and limited time merch. There's all of these, you know, branded activations like you mentioned before. There's all of these, like, if you don't get it now, it's probably never coming back. This is the only time you're going to get access to it. So there's a a FOMO component.

Sarah: Yeah. And, also, a lot of the just on, like, the executive side of things, a lot of the, um, like, showrunners and the people who are designing these houses have been around, some of them since the beginning of Halloween Horror Nights. There's a gentleman. He has been a part of Halloween Horror Nights Hollywood since the first year they did it, and he continues to develop concepts to he's, like, the face of Halloween Horror Nights now, and he's kind of a spokesperson for it. So I think there is just that, like, you know, it it's lore. It's a it's a culture. It's a it's a world people wanna be a part of. There's also celebrities that go, like, is kind of a big celebrity attraction. So there's there's a lot going on, and they transform the entire park too. There's plenty of opportunities to buy merch even from the scare zones, which are not houses per se, but there are areas of the park that they'll transform, and they'll theme that based on movies or concepts or The Exorcist or Scarecrow or whatever it is. And I think people just get really excited to to see what's in store year after year, especially if you're a repeat visitor. And it encourages you to be a repeat visitor because every year is so different.

Phillip: More consumption, like, more alcohol, more, like, novelty purchases, IP leverage. We talked about the single night tickets. There's probably, like, levels to that experience, like FastPass or something like that. How are what are the other ways that are being commercialized to, like, make more premium experiences? Uh, how do they how do they up the ante and get people to spend it even more?

Sarah: Well, I think just the scale of the event too. Um, it it is impossible to do every house in one night, so a lot of people do buy two nights at [00:10:00] once. Um, that's on purpose. Mhmm. And a lot of times, if you're all the way in Universal, if you're all the way in Orlando, you're already there. You're probably gonna buy a daytime ticket as well.

Brian: Yeah. Doubling up.

Sarah: Yeah. You double up. You either go for two nights or you're going for a day at the park and a night at Halloween. It's too much going on to fit into one night, which is impressive.

Phillip: Do they retheme the Harry Potter world experience for Halloween Horror Nights?

Brian: No need to. It's it's it's already magical and creepy.

Phillip: See? See? And you know what my mom would say? That should tell you everything you need to know about Harry Potter. Evil. Exactly.

Sarah: Yeah. Yeah. No. They leave it they leave it open. Yeah. It's kind of interesting because you'll be in this like, gosh, there's so much. The soundtracks of Halloween Horror Nights are so curated. They work on those all year. I read somewhere that they outsource, like, aromas and scents from No. Like, a a lab in New York that's crafting scents for different scare zones and houses. This is gory, but I went through a house once that was, like, cannibalism themed, it smelled like barbecue. Like, it is Ugh. It's gnarly. But, like, you're kind of so immersed in just, horror and gore, and then you step foot into Diagon Alley, and it's like, just like a weight lifted, and there's like butter beer being served. It's like Harry Potter music playing in the background, like, is they just leave it untouched, which I love.

Phillip: Yeah. This has been, uh, really enlightening, really eye opening. I I don't think I ever really considered the scale of, you know, the Endeavor, and it does take place in more than one park. You know, it's across the two parks.

Sarah: Yeah. So there's a Forbes article that, uh, came out in 2023, which is a really interesting read. And this just kind of unpacks, like, you know, the scope of the park kind of in modern days now. And, of course, there's Universal in Florida, California, Japan, and Singapore, and they're all engaging in Halloween Horror Nights. They estimate now that the revenue from, you know, just the September and October Halloween season for Universal from Halloween Horror Nights makes up at least $575,000,000 of Universal Orlando's annual revenue. Some estimate maybe between 10 to 20% of that is food, bev, um, and then you've got merch on top of that. This is ticket sales and everything that you're buying during your experience in the park, um, at the same time. And so that's where that metric of that thirteenth month of revenue really comes through. And you're right, Philip. It's happening during a month where all of the other parks are still operational, so they're just adding on hundreds of millions of dollars.

Phillip: Alright. Thank you for tuning in to this episode of SpookyCommerce. This conversation spooked something for you. Like, subscribe, and follow wherever you can get your podcast. It helps more people join the conversation. If you wanna bring more future commerce into your world, you can do that. Join us at our print shop. You can get it today at futurecommerce.com. Click on the shop link or go to shop.futurecommerce.com. It's where commerce meets culture in our beautiful print, uh, collectibles. And remember, commerce shapes the future because commerce is culture. We'll see you next time.

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