Halloween spending expected to hit a record

Spending on candy, costumes, decorations, and parties is rising. The expected amount Americans plan to spend on Halloween is $12.2 billion in 2023, according to the National Retail Federation NRF). That beats last year's record of $10.6 billion.

More Americans than ever are celebrating with 79% of people participating, which is greater than last year and exceeds pre-pandemic levels as well. In addition, 76 percent of adult American pet owners plan to put their pets in costumes, according to a PetSmart national survey. The average amount consumers will pay to celebrate the holiday is $108.24 versus $102.74 last year.

Candy is still at the top of the agenda for households. They will spend $3.6 billion in rewarding trick-or-treaters at their doors. Those doors, as well as front steps, interiors, and yards, will be decorated with pumpkins, spider webs, skeletons, etc. Those decorations will total $3.9 billion, even more than consumers will spend on candy.

Halloween parties are also gaining increased popularity, especially among Gen Z and Millennials. The three great elements of such parties are costumes, the food, and the decorations. While today's party goers may believe they are forging a new trend in entertainment, Halloween parties are simply a blast from the past.

In the late 1800s, Halloween parties for both children and adults became the most common way to celebrate the holiday. Parties focused on games, foods of the season, and festive costumes. By the 1920s and 1930s, the holiday had become a community-centered event with parades and town-wide Halloween parties as the featured event.

So, it's 'back to the future' this year as more than 32% of American consumers plan to attend or throw a Halloween party. And like days of old, beyond your typical neighborhood get-together, there are long lists of Halloween parties (now listed on the internet) for just about every community in the nation.

However, it is costumes that have garnered the greatest spending $4.1 billion up from $3.6 billion last year. More consumers than ever (69%) are planning to buy costumes this year. Adult costumes saw an 18% increase, while children accounted for a 20% gain. Spidermen, princesses, ghosts, witches, and other superheroes still account for the lion's share of children's preferences. This year aside from the traditional stable of vampires, witches, and Batman, Barbie and Ken will be top picks for adults.

A growing new category for costume demand is pet costumes.  The NRF believes consumers intend to spend as much as $700 million on costumes for their pets. Dogs seem to be the target of most owner's costume spending, according to another survey by Honest Paws.

The most popular costumes include a pumpkin, a hot dog, a bat, a bumblebee, a spider, and Chucky. Most owners planned to spend under $50 for Fido's disguise, but a third of dog owners admitted that they spent more money on their dog's costume than their own.

Another trend that seems to appeal to most costume buyers with pets is matching outfits for both owner and dog.  Do not be surprised therefore to see a Bat dog and Robin knocking on your door.  Almost 50% of owners plan to bring their dog along for trick-or-treating and more than one quarter will be competing in costume contests with their pet.

Just a side note on pet costumes. My canines, both past and present, would run for the hills at the drop of a costume hat. Most pets that show similar signs should never be forced to wear a costume. If you absolutely must dress your pet in something, make sure whatever costume you select allows your pet to be able to move and breathe easily. Clothing that resembles a traditional dog vest, or t-shirt that doesn't cover the entire body and head are the best. You may not win that neighborhood costume contest, but your pet will thank you for it, and Halloween for both of you will be far more memorable. 

Bill Schmick is a founding partner of Onota Partners, Inc., in the Berkshires.  Bill’s forecasts and opinions are purely his own and do not necessarily represent the views of Onota Partners, Inc. (OPI).  None of his commentary is or should be considered investment advice.  Direct your inquiries to Bill at 1-413-347-2401 or e-mail him at bill@schmicksretiredinvestor.com .Investments in securities are not insured, protected or guaranteed and may result in loss of income and/or principal.