Consumers are expected to spend an all-time high of $10.14 billion on Halloween-related items this year—that's a 26% jump from the $8.05 billion spent in 2020, according to a survey by the National Retail Federation (NRF).
"Americans plan to spend more than ever to make this Halloween a memorable one," said NRF President and CEO Matthew Shay. "Retailers have implemented a number of measures, such as bringing in Halloween products earlier than normal, to ensure their shelves are stocked with seasonal candy, décor and other items ahead of this important holiday."
The record-setting seasonal estimate comes after a year of shut-downs. Many trick-or-treaters skipped their neighborhood jaunt in 2020, which led to a significant dip in costume sales. This year, however, costume spending is expected to break pre-pandemic levels at $3.32 billion, followed closely by decorations at $3.17 billion, which is up more than half a billion dollars over last year's $2.59 billion.
"The largest jump in Halloween spending is in decorations," said Benjamin Wolthuizen, an equity analyst with Cavanal Hill Investment Management, Inc., who covers the consumer discretionary sector, including non-essential retail industries. "This is an area where consumers spend during other holidays, so I wouldn't be surprised to see Halloween décor continue at this higher level going forward."
The NRF data estimates that households with children spend more than twice the amount of those without ($149.69 versus $73.57) for Halloween.
But with supply chain disruptions and the continuing threat of the Delta variant, it's hard to know if this robust spending trend will carry over into the traditional holiday shopping season.
"It's a bit too early to know what the year-end holiday spending season will look like this year," Wolthuizen said. "But I expect the Halloween trend around shopping earlier leading up to the holiday to be reflected into November as well."
In 2020, retailers tried to make up lost ground by rolling out holiday specials way earlier in November than traditional Black Friday sales. Wolthuizen expects that will be the case again this year, but said he is hearing that retailers may be offering fewer discounts in conjunction with those promotions this time around.
"With supply chain constraints and lower inventories, I think we'll see less discounting on existing goods because there's less overstock to fill the shelves," he said.
Wolthuizen said he does expect people to physically shop in stores. While e-commerce is a big trend, it still accounts for less than 20% of all retail sales. Brick and mortar locations are getting creative on ways to get shoppers in the door while maintaining safe environments during the pandemic. One way they're doing that: attempting to own the early November shopping season and beat out competitors for market share.
As shoppers begin to check off their holiday gift list earlier and earlier, will candy corn and jack-o-lanterns begin to overlap with candy canes and inflatable Santas?
"Especially in the midst of the pandemic last year when companies were offering earlier holiday promotions throughout the month of November, it started to feel like a giant holiday season for retailers," Wolthuizen said.
And while spending on costumes and fake cobwebs is up, the average outlay for Americans is still only $102.74 on Halloween versus an average holiday spend of nearly $1,000 per person on non-travel related items, according to a 2020 NRF survey.
"While I expect Halloween spending to creep earlier into September in the future, I don't think we'll see personal spending levels on that seasonal celebration to even touch November/December traditional holiday spending levels any time soon," Wolthuizen said.