Aug 16, 2022 - Economy

Halloween immune to inflation

Illustration of an animated ghost emoji, transitioning from a serious face to a smile, sticking its tongue out, and sunglasses lowering over its eyes.

Illustration: Brendan Lynch/Axios

Inflation has inspired a lot of hemming and hawing in shopping malls and grocery stores, but it barely dents the "excitement" for Halloween, Home Depot CEO Ted Decker quipped this morning on an earnings call.

Why it matters: Halloween means big business for retailers. Americans last year were expected to spend $3.17 billion on decorations, near pre-pandemic levels. And the early returns for 2022 show more of the same.

Catch up quick: A giant, 12-foot hovering animatronic witch sold out online at $299 when the company recently began its Halloween sales.

  • "How quickly people are spending $300 for a clearly discretionary item but [one that's] a lot of fun," speaks to the "resilience" and willingness of customers to spend, said Decker.

Be smart: Home Depot's customers — ultimately, home owners — have been benefitting from the boom in home values over the past two years. They're in "a really good place right now" with what they can afford, CFO Richard McPhail noted on the call.

  • The company says it hasn't seen consumers "trade down" on items as prices in stores go higher.

The big picture: Retailers like Walmart and Target, which cater to a broader set of consumers, have been struggling to maintain profit growth as people buy fewer discretionary or nice-to-have products, including home goods, clothing and electronics.

Our thought bubble: Necessity is always subjective and relative, even during this period of high inflation. But fun — is always a non-negotiable.

Go deeper