How candy companies plan to save Halloween 2020

Americans will be donning a different kind of mask this Halloween.

For some, knocking on doors and getting bags of candy from strangers may lose its appeal as people limit their social circles. Office candy bowls will remain empty. And Halloween costume parties may be scaled down or canceled.

Yet candy companies, including Hershey and Ferrero, say they are hopeful that kids will still trick-or-treat and adults will seek out sweets, even if their celebration is simpler or socially distanced because of the coronavirus pandemic. It’s also inspired those companies to adopt a bolder marketing approach as they consult with medical experts, put out safety guidelines, encourage creativity — and even defend trick-or-treating in the public square.

“People are going to have to get creative this year, but that doesn’t mean that they have to sit this year out,” said Christopher Gindlesperger, the National Confectioners Association’s senior vice president of public affairs.

He said instead of going door-to-door, the trade group has heard of families planning to host candy scavenger hunts, tie individually-wrappedtreats to a tree in the front yard or have trick-or-treating stops for their kids in different rooms of their own home. Some neighborhoods plan to have socially distanced costume parades before returning home to enjoy bags of candy purchased for their own households.

Halloween is the biggest sales driver for the chocolate, candy, gum and mints industry, surpassing other seasons like Valentine’s Day, Easter and Christmas. It makes up about $4.6 billion of the industry’s $36 billion annual revenue, according to the National Confectioners Association.  

“It’s our Super Bowl,” the trade group’s Gindlesperger said. “It’s our World Cup moment.”

The holiday is so significant for Snickers maker Mars Wrigley that it starts planning two years in advance, working with retailers on emerging trends and new flavors. The privately held company began pivoting its plans in March, according to Tim LeBel, its president of U.S. sales, who also holds the title of “chief halloween officer” from July through Oct. 31.

The National Retail Federation expects overall Halloween consumer spending to fall 8{3c4481f38fc19dde56b7b1f4329b509c88239ba5565146922180ec5012de023f} to $8.05 billion this year, but projected that those celebrating will spend about 6{3c4481f38fc19dde56b7b1f4329b509c88239ba5565146922180ec5012de023f} more on average.

So far, with Halloween more than a month away, seasonal candy has been selling more than usual. Total sales of Halloween chocolate and candy are up by 13{3c4481f38fc19dde56b7b1f4329b509c88239ba5565146922180ec5012de023f} for the latest four weeks ended Sept. 6 versus the same period in 2019, according to market research firm IRI. It’s up about 17{3c4481f38fc19dde56b7b1f4329b509c88239ba5565146922180ec5012de023f} at grocery stores.

Krishnakumar Davey, president of strategic analytics at IRI, said that increase could be due to Halloween candy displays going up earlier than usual. Hershey’s holiday season, for example, started two or three weeks earlier, depending on the retailer. That means those pumpkin-shaped chocolates are catching the eye of consumers, who may want to enjoy the change of season or treat themselves or find a way to cope during a difficult time. 

“Chocolate is an affordable indulgence and some people use it when they’re distressed,” he said.

Easter candy sales were down about 4{3c4481f38fc19dde56b7b1f4329b509c88239ba5565146922180ec5012de023f} industry-wide, according to IRI data, so companies want to be proactive with marketing. “They’re trying to shape their destiny,” he said. 

Mondelez, which makes Swedish Fish and Sour Patch Kids candies, said it expects its Halloween business to see higher sales this year. So far, consumers are eschewing the individual packages best for distributing to trick-or-treaters in favor of family-size packs, according to Iryna Shandarivska, head of Mondelez’s U.S. candy division. And while most Halloween candy purchases typically take place in the week leading up to the holiday, this year the company expects buying to be more evenly spread out ahead of Halloween.

Hershey, too, is forecasting higher Halloween sales this year. Phil Stanley, the company’s global chief sales officer, said its Halloween sales are up more than 21{3c4481f38fc19dde56b7b1f4329b509c88239ba5565146922180ec5012de023f} in the last six weeks. The holiday accounts for about a tenth of its annual sales, and typically about half of the candy bought during the season is for consumers’ own consumption, rather than handing out to kids.

Ferrera, which owns well-known candy corn maker Brach’s, anticipates sales will increase, too. The company produces 85{3c4481f38fc19dde56b7b1f4329b509c88239ba5565146922180ec5012de023f} of all candy corn sold in the U.S. annually.

Brach’s shipped bags of candy earlier than in years’ past — with direct-to-consumer fulfillment starting three months earlier than usual, according to Peter Goldman, vice president of seasonal confections at Ferrara. It also put more varieties of candy in individual bags, debuted a new type of candy called Turkey Dinner Candy Corn and increased its focus on e-commerce. The company is part of the Ferrero Group. 

But not all candy makers are expecting a boost to sales. Ferrero North America’s CEO Paul Chibe said the company expects sales to be flat this Halloween as families take a more cautionary approach. Its candy brands include Halloween staples like Crunch, Baby Ruth and Butterfinger along with other well-known brands like Nutella, Tic Tac and Ferrero Roche. Candy sales during the season make up about 20{3c4481f38fc19dde56b7b1f4329b509c88239ba5565146922180ec5012de023f} of the company’s annual revenue. 

The company kicked off a new campaign called “31 Days of Halloween” to encourage customers to extend the holiday.

Throughout the pandemic, however, Ferrero and other candy makers have seen a pop in sales as people look for affordable treats. Hershey’s S’mores kits have gotten a boost as consumers spend more time outdoors. Chibe said its Nutella business is “growing like crazy,” as more kids eat breakfast at home, and sales of its premium Ferrero Roche chocolates have shot up, too. Nutella’s sales have grown 17{3c4481f38fc19dde56b7b1f4329b509c88239ba5565146922180ec5012de023f}, the company said. He said customers are buying bigger packs when they buy candy, too.

“A lot of people feel like ‘I can’t go to a restaurant. I can’t eat out, but when I do go to the grocery store, I’m going to indulge,'” he said.

Ferrero’s chocolate sales are up 5{3c4481f38fc19dde56b7b1f4329b509c88239ba5565146922180ec5012de023f} versus last year. Its everyday chocolate portfolio, which includes Butterfinger, Crunch, Baby Ruth, Kinder Joy and Kinder Bueno, is up 16{3c4481f38fc19dde56b7b1f4329b509c88239ba5565146922180ec5012de023f}, the company said.

Chibe said customers may upgrade to premium brands, such as Kinder Joy, if they buy for their own kids instead large groups of trick-or-treaters. Plus, he said the holiday gives families a break. 

“Kids have had a tough, tough time with the coronavirus,” he said. “They’re out of school. They’re away from their friends. They’re unable to participate in all the after-school activities. It would be a shame if adults, with all the creativity and ingenuity we have, we couldn’t figure out a way for kids to celebrate Halloween.”

And he added, trick-or-treating can be pandemic-friendly since it’s outdoors, costumes can incorporate face masks and candy can be shared in contactless ways.

The trade group, National Confectionery Association, recently defended trick-or-treating, after Los Angeles health officials banned the tradition. The health officials later backtracked, instead adding it to a list of activities that are not recommended.

Other public officials, such as New York Governor Andrew Cuomo and New Jersey Governor Phil Murphy, have said they won’t take official action, but acknowledged that celebrations would look different — along with nearly everything else during the pandemic. 

The National Confectionery Association has a website, dubbed Halloween Central, which suggests safe ways to celebrate, includes quotes from politicians and medical experts and links to Centers for Disease Control & Prevention social distancing guidelines. 

Some candy makers are addressing parents’ safety concerns as part of their marketing plans for the holiday. 

Mars Wrigley, for example, is releasing an app at the beginning of October for a virtual trick-or-treating experience that lets users rack up points to redeem real candy, like its 3 Musketeers and M&Ms. LeBel said the company is also making small- and medium-sized variety bags for Zoom costume parties and scary movie nights among families. 

Hershey has created a website with assistance from the Halloween Costume Association and the Harvard Global Health Institute to map out how to celebrate safely, given the geographic area’s Covid-19 spread.

Chibe acknowledged that behavioral changes could shake up sales and said his own routine will change, too. In his neighborhood in St. Louis, he and his wife usually hand out full-sized candy bars to trick-or-treaters. This year, he said they plan to decorate, put together bags of candy and remain socially distanced as kids pick them up from the front porch.