Retailers hope for a big Halloween with sales forecast at $12.2 billion

The National Retail Federation (NRF) says Halloween spending could reach a record $108.24 per person and total $12.2 billion, up 15% from a year ago. The NRF expects 73% of consumers to participate in Halloween, up from 69% a year ago.

“More Americans than ever will be reaching into their wallets and spending a record amount of money to celebrate Halloween this year,” NRF CEO Matthew Shay said. “Consumers will be shopping early for festive décor and other related items and retailers are prepared with the inventory to help customers and their families take part in this popular and fun tradition.”

Increased spending is not a surprise given the higher costs of candy and costumes this year over last. Retailers have merchandised heavily for the fall holiday in the hope of driving sales. Just under 70% of survey respondents said they will hand out candy to trick-or-treaters this year. Candy sales are expected to top $3.6 billion this year, up from $3.1 billion in 2022.

Another recent survey by Power Reviews found 34% of respondents intend to buy cheaper candy and ease back on other Halloween-related purchases because of economic challenges.

“History tells us that, during times of economic hardship, candy sales still rise,” said Scott Lieberman, founder of the touchdownmoney.com financial advisory site.

The U.S. Bureau of Labor reported in August that candy prices were up 13.1% over the year-ago period. Cocoa prices continue to rise due to supply chain issues and ongoing drought. Hershey, one of the largest candy makers, raised prices across the board 17% earlier this year. The most popular Halloween candy is Reese’s Peanut Butter Cups and they were downsized last year with a slight price increase. Mars Wrigley has raised candy prices by about 12% impacting the cost of M&M’s, Snickers and Skittles.

NRF expects costume spending  to total $4.1 billion, up from $3.6 billion in 2022. Again, costume prices are more expensive than in 2022 but Walmart and Target offered early shoppers discounted prices starting in August when the merchandise went into stores.

NRF said children’s costume sales should total about $1.4 billion, up from $1.2 billion last year. The most popular kid costumes include Spiderman, princesses, superheroes, ghosts and witches. The average cost of a kid costume for a princess was $33 at Walmart. Superhero, Spiderman and other popular costumes cost around $20 on Walmart.com. Target.com recently discounted their kid’s costumes by 30% to cost between $11 and $18 for the most popular selections, according to price checks on Sept. 21.

It’s not just kids who dress up for Halloween. NRF estimates adults will spend $1.7 billion on their costumes this year, up from $1.58 billion in 2022. In recent years family pets also get dressed up for Halloween That said, consumer spending on pet costumes is flat with a year ago at $700 million.

Similar to other major holidays and spending events like back-to-school and the winter holidays, consumers are looking to get an early start on their Halloween shopping. Nearly half (45%) of those celebrating the holiday plan to start shopping before October. This is on par with last year, but up from 33% a decade ago.

“Younger consumers are eager to begin their Halloween shopping, with more than half of those ages 25 – 44 planning to shop before or during September,” Prosper Executive Vice President of Strategy Phil Rist said. “Social media continues to grow as a source of costume inspiration for younger consumers, as more people under 25 are turning to TikTok, Pinterest and Instagram for ideas.”

Total spending on Halloween decorations, which grew in popularity during the pandemic and continue to resonate with consumers, is expected to reach $3.9 billion. Of those celebrating Halloween, 77% said they plan to purchase decorations, which is on par with last year, but up from 72% in 2019, NRF reports.