Snacks & Candy

Recession Won't Carve Into Halloween Spending

Sales expected to reach $6 billion;Americans shunning private-label sweets
LOS ANGELES -- Despite economic gloom casting a spell on consumer confidence this year, America's darkest holiday is looking bright for retailers. According to industry research firm IBISWorld, Halloween sales are expected to reach a record-breaking $6 billion in 2009, up 4.2% from the $5.77 billion generated last year.

"Economic recovery appears to be around the corner and consumers are enthusiastically looking to escape their recessionary woes," said Toon van Beeck, senior analyst with IBISWorld. "Even last year, when the outlook was much worse, the Halloween spirit remained [image-nocss] unhindered as we saw total sales actually jump 5.1% from 2007."

Halloween retail sales are comprised of a wide range of consumer goods, aimed at adults, children and even pets. These goods include costumes, scary make-up, wigs, Halloween decorations for inside and outside, and of course, pumpkins and candy, among other things.

In projecting this year's total sales, analysts at the Los Angeles-based firm aggregated the retail-dollar performance of the following four traditional Halloween categories:


It appears an increasing number of people are buying treats this year, making candy the fastest-growing holiday category. The average person is estimated to spend about $22.50 on Halloween treats in 2009.

Also fuelling this year's record-breaking sales is the demand for holiday decorations. With Halloween falling on a Saturday this year, more adults are expected to join the fun. In fact, 32% of people celebrating the holiday will either host or attend a party. For this reason, IBISWorld said it expects decorations to reach its highest level yet at $1.64 billion.

"Halloween-related festivities are a growing trend and this is driving sales of decorations and candy,"said van Beeck. "Dollar and variety stores stand to benefit from the 4.4% increase in decoration sales, as consumers look to purchase cheap and disposable thrills to make a memorable evening."

Costumes are expected to generate the greatest amount of revenue this Halloween, but growth is slight (2.4%) as consumers will apply more frugal but creative approaches when shopping.

"Despite more people participating in festivities, money is still tight and consumers will look to cut corners when it comes costume purchases," said van Beeck. "Instead of buying a packaged costume, which can cost up to $60 on average, people will get more eclectic and opt for cheaper individual items."

But given the lack of growth for the card category, not all cheaper items will fare well this year. While cards did well last year, as consumers chose to cut back on pricier categories, 2009 expenditures will revert back to traditional shopping habits.

"Although unemployment is still very high, the overall outlook is far rosier today than it was this time last year," added van Beeck. "For this reason, IBISWorld expects the upward trend in Halloween expenditures to continue its course for 2009, which despite economic conditions will prove to be the best year yet."

Separately, NielsenWire said that as American consumers get set to buy nearly 600 million pounds of candy this Halloween, they are choosing fewer store-brand or private-label sweets, opting instead for brand-name treats. During the year, store brands candy for an 8.1% share of candy sales, but in the weeks leading up to and including Halloween, the store-brand average dips to 5.6%. The trend is the same for both chocolate and non-chocolate candy segments.

"Without a doubt, consumers continue to turn to store brands in a down economy," said Todd Hale, senior vice president of Consumer & Shopper Insights, The Nielsen Co. "What we see with Halloween candy sales, however, is a sign that consumers may be 'splurging' with brand name products for the holiday or simply taking advantage of brand name promotions and price reductions. Candy manufacturers invest a great deal of marketing dollars to build brand equity in candy and private-label candy has not been able to overcome that investment and grab significant share."

Halloween is the biggest season for chocolate candy, with nearly 90 million pounds of chocolate candy sold during Halloween week. By comparison, nearly 65 million pounds of chocolate candy is sold during the week leading up to Easter and only 48 million pounds of chocolate candy is sold during Valentine's week.

Consumers tend to wait until the last minute to purchase Halloween candy, either procrastinating or hoping for a better deal. The biggest candy buying days of the Halloween season are the Sunday before the holiday and on Halloween day. In total, approximately $1.9 billion (or 598 million pounds) of candy is sold during the Halloween season.

Members help make our journalism possible. Become a CSP member today and unlock exclusive benefits, including unlimited access to all of our content. Sign up here.

Multimedia

Exclusive Content

Foodservice

Looking Up: Limited-Time Offers on the Rise

These deals continue to grow in all mealparts, Technomic reports show

Company News

Knowing Growing: QuikTrip Flexes in 2023

C-store chain celebrates 1,000th opening, opens 13th medical clinic, more

Foodservice

Get Creative in Foodservice to Thrive in 2024, Technomic Says

Report: Operators must lean into tech, menu and service innovation, take advantage of existing ingredients and resources

Trending

More from our partners