Chocolate makers get Halloween fright as health-conscious US shoppers cut back

Halloween sales figures this year have raised concerns for chocolate makers Hershey and Mondelez, as early data indicates US consumers are spending less on treats compared to previous years. Market researcher NIQ reported a $33.1 million decrease in Halloween chocolate sales in the nine weeks ending October 17, marking the largest drop in at least three years. This decline is primarily due to milk chocolate sales, while white and dark chocolate sales remained unchanged.

Health-conscious consumers are seeking low-sugar options and alternatives to traditional candy, according to interviews with industry experts, manufacturers, and analysts. Halloween chocolate sales dropped significantly compared to the same period last year. The midterm congressional elections approaching have contributed to a near-record low in US consumer sentiment.

Hershey CEO Kirk Tanner emphasized the need for a strong consumer turnout in the final days before Halloween, as the company had reduced its organic net sales growth target for the year. Lower cocoa prices have provided some relief for confectionery makers, who raised prices over the past three years. However, cocoa prices have dropped to under $3,000 per metric ton from a record $12,000 in 2024.

Mondelez International reported flat North American volumes and a 1.6% price increase in the third quarter, with growth coming more from volumes than pricing. The company's CFO, Amit Banati, stated that pricing would be selective to protect share and volume momentum. Producers are reformulating products and reducing chocolate content to cut costs.

Healthier choices are reshaping the candy aisles, driven by the rise of GLP-1 weight-loss drugs and the Trump administration's 'Make America Healthy Again' campaign. Small-pack sales are up 24% in dollar terms, while larger sizes are declining. Consumers are gravitating towards candy with no, low, or less-sugar claims and alternatives like rice/popcorn cakes, yogurt-coated snacks, bars, and ready-to-eat popcorn.

Companies like Mondelez are actively addressing these changes. Mondelez acquired Undercover Snacks, which produces chocolate-coated quinoa crisps labeled as 'healthy ingredients in disguise.' Chobani, a yogurt-maker, is promoting a Halloween special with 'no spooky ingredients' for its Ube Sweet Cream Dairy Creamer. The company's Chief Innovation Officer, Niel Sandfort, noted that consumers are increasingly aware of the contents in their food.

Halloween tends to be an indulgent holiday, but consumers are adapting by supplementing with potentially better-for-you options or opting for smaller treats.