October 10, 2023

ASU business professor weighs in on the perennial purchasing power of pumpkin spice products

For kids, the approach of fall means time for scary costumes, trick-or-treating and pumpkin carving. For adults, on the other hand, it means time for pumpkin spice.

And retailers are happy to oblige.

According to Nielsen data, the pumpkin spice trend is an industry of about $800 million a year. Not only will consumers once again wait in line for a tasty Starbucks Pumpkin Spice Latte this season, but shoppers can buy pumpkin spice cookies, beer, chocolate, biscuits, hummus, biscotti, creamer, meatballs, pretzels, cereal, pudding, cream cheese, trash bags, Spam and Kool-Aid. There’s even a company that sells seasonal pumpkin spice toilet paper — but we won’t go there.  

ASU News tapped Lee McPheters, a research professor and director of the JPMorgan Chase Economic Outlook Center in Arizona State University’s W. P. Carey School of Business, to talk about this global obsession and why retailers go out of their gourd when it comes to selling pumpkin products.

Man in grey suit smiling

Lee McPheters

Question: What can you tell us about the pumpkin spice explosion and how it started?

Answer: We know from historical recipes that bakers in the 1800s used spices such as cinnamon, nutmeg and ginger, especially to add flavor to pumpkin pie, which otherwise was bland. Then, in the 1930s, the spice companies began offering “pumpkin pie spice” as a single pre-blended spice mix, making it much easier to bake a perfect pumpkin pie for Thanksgiving. Some cynics have pointed out there is no pumpkin in pumpkin spice, which is correct. Pumpkin spice was developed by companies like McCormick to “spice up” a pumpkin pie.

Q: Today, pumpkin spice is in all sorts of products, from lotions to candles, and of course, coffee. When did pumpkin spice start gaining such popularity?

A: Certainly, Starbucks established pumpkin spice as an autumn tradition when they debuted the pumpkin spice latte in 100 stores in 2003. It is now their most popular seasonal flavor, with estimates of cumulative sales over the past 20 years exceeding 400 million lattes. They have developed various innovations to keep the trend going, and in 2015, they added a dash of pumpkin to the spice blend. 

Q: What kind of money are we talking about in terms of economic impact for pumpkin spice products?

A: Sales of pumpkin spice-related products in the 12 months ending in July 2023 topped $800 million, according to NielsenIQ, a company that tracks these figures. Their report also included an estimate of the number of pumpkin spice products on the market at over 3,000, which was down about 5% over prior years. This suggests that even an iconic product like pumpkin spice can have diminishing returns. I don’t know that we needed Hormel to start selling pumpkin spice Spam in 2019, but sales seem pretty good.

Q: We expect to see pumpkin spice during the fall season, but these products have gotten an earlier start this year, some as early as August. Why do you think that is?

A: E-commerce experts have noticed this too, and they tell us we are seeing the effects of social media, where influencers have the power to start trends, and the companies must follow. And, of course, competition plays a role. Dunkin’ also has pumpkin spice products, and they released their fall menu Aug. 16. Krispy Kreme did the same, even earlier, on Aug. 7. Pumpkin spice became available at Starbucks Aug. 24, about a week earlier than last year.

Q: It seems like pumpkin spice represents something far greater than just something tasty. Do you think it will eventually begin to wane, or is it here to stay as an American tradition?

A: Pumpkin spice is firmly embedded as a meteorological signal that fall is coming. Even though the temperature in Arizona was over 100 degrees in August, the availability of pumpkin spice meant change was in the air; the weather will soon be cooling off. Social media picked this up with strongly positive postings. Like the smell of fresh-cut Christmas trees, pumpkin spice sends a message of familiarity and comfort, and that is something everybody likes.

Top photo courtesy Pixabay

Reporter , ASU News