Anticipating a slump in trick-or-treating this year due to COVID-19 fears, Hershey launched in-store displays at U.S. retailers as early as August and tweaked much of its merchandise towards everyday consumption.
At the same time, it was tailoring digital ads to households using search data provided by Google, targeting those who were more or less likely to go out based on what they searched for.
The result was an 80% rise in e-commerce sales and net Halloween sales that were "slightly" higher than 2019 and also boosted its seasonal market share gains by 4 percentage points.
"We saw lower participation in trick or treat in the final two weeks (of Halloween), but overall, the category showed resilience in a very volatile environment," Chief Executive Officer Michele Buck said in prepared remarks.
Halloween, typically the candy industry's biggest holiday season by sales, represents a tenth of Hershey's roughly $8 billion in annual revenue.
In September the company told Reuters it would increase digital spending on the season by 160% this year, as it anticipated parents would buy S'mores, Twizzlers and other candy online.
Overall, net sales rose 4% to $2.22 billion in the quarter ended Sept. 27, with baking items including peanut butter, syrup, chips and cocoa also improving.
Excluding items, the company earned $1.86 per share, allowing it to reinstate the full-year outlook it pulled in April.
It forecast full-year net sales to rise about 1%, anticipating organic sales growth in the fourth quarter would be similar to the third. Adjusted earnings per share are expected to rise between 7% and 8% to between $6.18 and $6.24 per share.
(Reporting by Siddharth Cavale in Bengaluru; Editing by Shailesh Kuber and Patrick Graham)
By Siddharth Cavale