Snow squalls are in the forecast for Collingswood's business district through Christmas Eve, creating a winter wonderland for shoppers and diners.

"It's very Bedford Falls," borough spokeswoman Cassandra Duffey said.

Facing tough competition from malls and chain stores, Main Streets from Collingswood to Doylestown are working hard this year to market themselves to shoppers on limited budgets. Merchants are working together on discounts, sponsoring giveaways, and revamping traditions. A free parking meter doesn't cut it anymore.

Last holiday season, the Collingswood business improvement district diverted several thousand advertising dollars to rent snowmaking machines in the hope that impromptu flurries would generate excitement and foot traffic. The machines are at it again, pumping out flakes for store events and weekend caroling under the town's quarter-million twinkling lights.

"It snows at different spots on Haddon Avenue. People love it," Mayor Jim Maley said. "It certainly adds to what Collingswood is at the holidays: a hometown."

"Everyone is looking to find out what's going to work postcrash," said Bill Fontana, executive director of Pennsylvania Downtown Center, a statewide nonprofit dedicated to the revitalization of older communities.

An event like West Chester's Jingle Elf Run, he said, can acquaint consumers with a business district they didn't know existed.

"There's been a disconnection with downtowns over the last 30 to 40 years, especially with young people," Fontana said.

Retailers who offer incentives - gifts, coupons, discounts - will have people coming back, predicted Jef Buehler, director of the state's Main Street New Jersey and Improvement District Programs.

The Glasstown Arts District in Millville, N.J., had a giveaway yesterday for 45 handblown ornaments displayed in shops at the Cumberland County town's Soul of the Season festival. Winners become eligible for a $1,000 cash prize to be awarded Dec. 23.

Mill Race Village in Mount Holly scheduled its first-ever chocolate walk yesterday. Participants paid $15 or $20 to follow a map to stores and restaurants where their empty candy boxes were filled with professional and homemade treats. Besides luring consumers, the tasting benefited the Food Bank of South Jersey

"You want to have something a little different," said organizer Susan Thomas, owner of Silver Lining, which sells jewelry, sterling, and clothing.

Americans require 12 to 13 positive impressions of a business before they make a purchase, Buehler said.

"You want folks to make an emotional connection," he said. "People, as a rule, are staying more local in terms of holiday travel. They're looking for things to do.

"Everyone can walk to downtown events and take a carriage ride. It creates memories. But ultimately you want to get them to buy, or it's not sustainable."

To pry open wallets, shopping districts increasingly are pooling their efforts with keep-it-local gift cards and certificates good at multiple businesses, owners say.

"Free money is a very popular thing," said Maley, whose borough offers a bonus $10 for every $50 in "Collingswood Cash" gift certificates purchased. Including last holiday season, when it was launched, the campaign expects to sell $500,000 worth of certificates, which must be spent in town.

"When dollars are spent locally, they circulate and create additional jobs," Fontana said.

On Thursday, when Haddonfield held its holiday house tour, selected restaurants offered a 10 percent discount to anyone with a receipt for merchandise purchased that day at a borough shop.

Marthae Neill, 50, of Mount Holly, and her mother, Rebecca White, of Moorestown, hadn't heard about the discount, but they took a break from their annual holiday shopping trip in town to lunch at the Little Tuna.

"I'm kind of bored with the malls," Neill said. "You can get things here you can't get at the malls."

She bought a few items at the English Gardener Gift Shop, where sales associate Lisa Savaria said business was booming. Savaria credited the town for its efforts to boost crowds, such as Friday-night candlelight shopping, carriage rides, and music in King's Court.

Many districts that sponsor annual events have raised them a notch this year, planners said.

West Chester resident Todd Marcocci of Under the Sun Productions, which stages Philadelphia's Thanksgiving parade, volunteered to spice up the borough's holiday parade Dec. 4. He included 6ABC and Radio Disney celebrities, 12 marching bands, old-fashioned cars, and about 2,000 children walking ahead of Santa, said Mark Yoder, chamber of commerce executive vice president.

Step-off time was made later, at 8 p.m., to encourage shopping and dining beforehand, he said. Flavia donated hot chocolate and candy bars, and the chamber of commerce held a fun run.

"Police estimated the crowd at over 25,000 people," Yoder said. "It was absolutely the biggest event we ever had in downtown West Chester."

The Chestnut Hill Business Association combined its Germantown Avenue tree lighting with the community association's Circle of Trees lighting - and brought Santa in on a fire truck for the first time, said Fran O'Donnell, Main Street manager for the association.

Businesses offered reciprocal discounts with the new Tree Adventure and Holiday Garden Railway, both at nearby Morris Arboretum, he said.

"In these times, you really have to partner with everyone," said O'Donnell, owner of O'Doodles Toy Store.

Merchants also need to take credit for their civic contributions, such as decorating main streets with holiday greens and flower baskets, or sponsoring street fairs, said Ellen Mager, owner of the Booktenders' Secret Garden Children's Book Store & Gallery in Doylestown.

"Townspeople assumed it was the borough. Nobody knew it was us doing all these things," she said.

An early Hanukkah, which began Friday night, has spurred business this year, reported a number of store owners. Many say their sales pace is better than in 2008.

Proprietors are "doing what they have to do to make everything work," said Sherry Tillman, owner of Past*Present*Future, a crafts store in Ardmore.

Tillman remains bullish on Main Street's future: "It's like a real place. You can eat, get your shoes fixed. It's what makes America great, these small towns."

Contact staff writer Cynthia Henry at 856-779-3970 or chenry@phillynews.com.
Inquirer staff writer Chelsea Conaboy contributed to this article.