South Warrnambool Kindergarten Green Group celebrated Halloween by dressing up. L-R: 5 yr old Olivia Ljubic, 5 yr old Cooper Phillpot and 5 yr old Georgia Barton.

Children are enjoying the spooky fun and gorging of Halloween with enthusiasm. Photo: Leanne Pickett

COLES and Woolworths are reporting sales increases of as much as 30 per cent across lines of costumes, confectionary and pumpkins in the lead-up to Halloween as a growing number of Australians celebrate the spooky festivities of an essentially American holiday.

Other retailers too are cashing in on the excitement around Halloween, which will be celebrated on the night of October 31, with the nation's only supplier of Jack O'Lantern pumpkins expecting to sell around 100,000 of the easier-to-carve pumpkins this year, while specially created chocolates, costumes and even pumpkin-flavoured beer is primed to fly off the shelf.

Although the money spent in Australia still pales into insignificance against the estimated $US8 billion Americans are tipped to invest this year on fangs, fake blood and pumpkins, the Halloween festival is becoming a key fixture on the promotional diaries of local supermarkets Coles and Woolworths.

The duo, as well as other independent retailers, grocers and gift shops, will invest millions of dollars this year on in-store promotions, catalogues and decorations to spark interest in shoppers.

New research showing younger Australians, especially Generation Y, are

embracing Halloween's horrifying mood at a higher rate than Generation X and baby boomers.

Statistics from social demographic and trend experts McCrindle Research show Halloween is heavily skewed towards the youth market; 53 per cent of Gen Ys had celebrated the ghoulish holiday, against 45 per cent for Gen Xs and only 40 per cent of baby boomers.

Retailers are aware of this interest, investing heavily in store promotions and point-of-sale marketing to hook children and their parents. And it's no surprise given 51 per cent of Australians with primary school-aged children plan to get involved in Halloween activities.

''More Australians feel it is being celebrated, they see it around more, and more have some involvement in it,'' said social researcher and McCrindle Research founder Mark McCrindle.

''It's largely retail led, with themes and products in stores, such as special chocolates branded with Halloween and pumpkin displays,'' Mr McCrindle said.

Halloween carving pumpkins have been in Coles stores for a week and have been selling strongly with sales up 30 per cent on last year to date. Fresh produce wholesaler Moraitis is expecting to sell 100,000 Halloween pumpkins this season and has increased Jack O'Lantern pumpkin planting 10 per cent a year to meet demand.

Woolworths is selling a range of pumpkin-flavoured beer through its partly owned Gage Roads brewery.

Coles general manager of merchandise Chris Garlick said the supermarket aimed to generate an ''event'' atmosphere around Halloween. On Halloween day last year Coles saw an increase of three times the standard day confectionary sales.

''All of us look for events in which we can engage our customers and this is another fun event … which is different to other weeks of the year,'' Mr Garlick said.

''Costumes and decorations are at the low price point. I think customers think they will buy it for this year and again next year as well, but don't spend too much money on [items].''

A few years ago, the sudden popular rise in Halloween caught Woolworths short as the nation's biggest supermarket chain actually ran out of confectionary in the days leading up to the celebration.

''We plan ahead now and we obviously have a lot more stock of confectionary in the business but also we have a whole offer now around Halloween focused on the kids, families and fun,'' said Alex Dower, Woolworths general manager for groceries.

Woolworths and Coles are also using social media to spread the Halloween excitement and educate customers, offering tips, for example, on how to carve pumpkins.

Mr Dower said Woolworths would also cater with a lower price range where typically many shoppers choose their items for Halloween celebrations, offering costumes for less than $15.

Margy Osmond, chief executive of the Australian National Retailers Association, said stores such as Big W were seeing growth year on year for masks and costumes, with confectionary companies producing special ranges for Halloween, such as Cadbury Screme eggs.

Pet shops were doing a roaring trade in Halloween costumes for dogs.

But Mr McCrindle said Australians were very aware Halloween was essentially an American event that encouraged children to devour junk food.

''There is a sense it has a dark theme to it too,'' he said. ''In a sense it's surprising it's done so well.''