Candy makers, judging by the fewer debuts of Halloween candy this year, were not sure how the holiday would go because [image-nocss] of the economy, said Marcia Mogelonsky, a senior research analyst with Mintel International, Chicago. But as the economic situation worsens, and worries mount about investments and job stability, Halloween seems to be getting stronger.
"Halloween for grownups is a chance to let off some steam, and for kids, it's a chance for grownups to prove to kids the world is not falling apart. We still have Halloween," she told AP.
Research firm IBISWorld Inc. predicted that total retail spending will be up 5% this year to $5.77 billion, with one-third of that on candy. The two reasons for the boost? Higher prices as well as a need to escape from reality, it said.
But facing widespread consumer weakness across many sectors, there was some hesitation by candy makers. There were 35 new chocolate products for this season, compared to 49 last year, Mogelonsky said. For sugar and gum confectionaries, new product launches went from 119 to 54 this year. "It says to me that manufacturers are perhaps going into the holiday season a little more cautiously than they did last year because it's very hard to sell that stuff after Halloween, You lose money on it when you mark it down after Halloween," she said.
Hershey Co. president and CEO Dave West voiced concern in his company's recent third-quarter earnings call when asked about the effects of the economy and price increases, which many food makers have implemented to help recoup high input costs. "So particularly in these economic times, as we head to the fourth quarter, we are cautious about what we put into the system for both Halloween and the holidays," he told investors, according to the report.
Ryan Bowling, a spokesperson for Mars Inc., the maker of M&Ms and Snickers, said the number of varieties the company produced for Halloween did not change this year. "It's still business as usual," he told the news agency, noting the company has enhanced its website, including having a virtual haunted house and is holding promotions to drive the season's sales.
The stakes can be big if Halloween or any specially themed candies don't sell. Leftover items typically are sold at a steep discount a a a a a a a aoften 50% or more a a a a a a a aso retailers and candy makers may take a big hit to their profits. That is what the companies could have been scared of when they introduced fewer new Halloween products this year, Mogelonsky said.
Seasonal packaging, like autumnal themes, are not as susceptible because they last a longer time, and those are picking up steam, she said.
Most retailers try to avoid giving those big discounts and focus on selling their candy by Halloween, and they will use big promotions and seasonal displays to do it, Tom Pirovano, director of Industry Insights at The Nielsen Co., told AP. He said the drop in Halloween-themed candies was minimal and noted that it is not necessary for candy makers to come out with new themed products, because people are still going to buy candy, whether or not it is specially marked for a holiday. Companies do not even need to experiment that much, he said, adding it is often the tried and true brands people prefer.
"I think when people are shopping for trick-or-treaters, they want to get brands that kids recognize," he said.
Sales this year have been strong, hitting $201 million of seasonal Halloween candy in the 52 weeks ending September 6, up from $174.8 million last year, AP said, citing Nielsen. That number is about evenly split between chocolate and non-chocolate, with chocolate slightly ahead. Prices this year are up 2.9%, which gives sales numbers a boost, but unit volumes were also up more than 10% to 81.7 million.
Pirovano said the top seller this year, as it is many years, is chocolate miniatures. He declined to name a brand. He said chocolate miniatures tend to have a big rise in sales around Halloween, unlike any other time of the year.
The season is an important one to candy makers, and last year, the week of Halloween accounted for nearly 4.4% of their annual sales, Nielsen reported. In a typical week, candy makers make just under 2% of their annual sales. Halloween is not even the top holiday for candy. That is Valentine's Day, then Easter. Halloween is a close No. 3, followed by Christmas.
People like seasonal candies and no matter how bad things get, it is something they will want to keep looking forward to, Mogelonsky said.
"I think there's something to be said in this era of instant gratification where we have everything that we want all the time, to still have something special for a special time," she said.
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