The Pumpkin Spice Business Model


Culinary Artists Cash in on the Pumpkin Craze

Being a creative foodie, you know how fun and rewarding it can be to create something beautiful, fun, comforting, elegant and delicious. It can be all the more rewarding when it happens to be something that is a huge consumer demand, like the Pumpkin Spice craze. Some people see a demand and create; others create, and their product happens to be in demand, or even creates a new demand. Whatever your creative goals are, let’s use Pumpkin Spice as an example and dive into Pumpkin 101 and get the wheels turning.

According to an AdAge article about Pumpkin Spice Marketing, it produces $500 MILLION in seasonal revenue. Companies have learned that consumers love pumpkin spice, and not only is it selling well, but they can also charge a premium price for anything pumpkin. This is known as the “pumpkin spice tax.” Not to be mistaken for a literal tax, enforced by any government, it’s basically an upcharge for the flavor. Magnify Money has done two studies (2017 and 2020) that compared the prices of pumpkin spice flavored items to their year round counterparts. To use the most recent numbers from 2020, they found that some items cost the same as other flavors, but almost half of the products were more expensive. Averaging out to be an 8.8% inflated cost, which is a 10% increase from 2017’s “tax.” Reading their findings is interesting, but to summarize, Trador Joe’s had the highest mark ups and Target had the overall best deals for pumpkin items. And as far as coffee companies go, Tim Hortons had the biggest mark up and Dunkin’ Donuts prices had no increase at all. And, knowing you will never look at your PSL the same, Starbucks’ Pumpkin Spice Latte “tax” is 15.9% higher than their non-seasonal drinks.

How did this all come to be?

The original pumpkin pie spice blend was created by McCormick in 1934 using cinnamon, ginger, cloves, nutmeg and allspice, making it easy to flavor pumpkin pies. But Starbucks is arguably responsible for the flavor sensation we barely remember living without. The Pumpkin Spice Latte was first introduced in 2003 to 100 stores right here in Vancouver, WA as well as Washington D.C. With the help of hashtags, social media, and an already trending company, the flavor became basically synonymous with fall.

Starbucks tells the story of their creative process:

“The team had successfully developed the recipes for holiday favorites Eggnog Latte and Peppermint Mocha, and were looking for a new beverage to add to the fall espresso lineup. On this spring day, the team brought in kitschy fall decorations and pumpkin pies, and began to explore ideas for a pumpkin-inspired espresso beverage. They would sample a forkful of pumpkin pie, followed by a sip of hot espresso – teasing out which flavors from the pie best complemented the coffee.

They soon received the go-ahead from senior leaders to work on a prototype, and for the next three months tasted and re-tasted different versions of the beverage. They settled on a recipe that used pumpkin spice sauce with cinnamon, clove and nutmeg – handcrafted with espresso and steamed milk – and topped off with whipped cream and a dash of pumpkin pie topping.”

According to a news station in Minneapolis, Caribou and Starbucks say they use pumpkin puree in their drinks and the primary spice is cinnamon. “The other (spices) round it out and give it balance.” says UMN food scientist Gary Reineccius.

Why do people love pumpkin so much?

In a 2019 article discussing How Pumpkin Spice Became the Dominant Flavor of Fall, the flavor apparently has a psychological magnetism.

“Ultimately, ’people just want something very comforting,’ food scientist and CPG development firm Corvus Blue founder Kantha Shelke told CNBC Make It.

Director for Nutrition and Dietetics at St. Catherine University Megan Baumler said to Minneapolis, Minn.’s WCCO TV station, ‘It’s hard to say goodbye to summer. But, if we can latch onto something, it makes it easier to transition.’

Consumers continue to enjoy that comfort as a way to cope with the changing seasons, and will pay more for the fall specialty items, meaning that brands will continue to provide returning and new pumpkin spice products to fill the ever-growing market for them.”

All Things Pumpkin

  • National Pumpkin Day – October 26th every year
  • Morton Pumpkin Festival – Held annually in Morton, IL; Pumpkin Recipe Challenge-Mark your calendar for next year: Sept 14-17, 2022
  • Pumpkin is botanically considered a fruit but considered a vegetable in the kitchen. “A fruit develops from the flower of a plant, while the other parts of the plant are categorized as vegetables. Fruits contain seeds, while vegetables can consist of roots, stems and leaves. From a culinary perspective, fruits and vegetables are classified based on taste. Fruits generally have a sweet or tart flavor and can be used in desserts, snacks or juices. Vegetables have a more mild or savory taste and are usually eaten as part of a side dish or main course.”
  • Nutrients of a Pumpkin: “Not only are they one of the best-known sources of beta-carotene (an antioxidant converted to vitamin A in the body), but pumpkins are loaded with fiber, potassium, and vitamin C. Did you know that the potassium in pumpkins can have a positive effect on blood pressure? Eating a diet high in fiber, potassium, and vitamin C (all of which pumpkins have), is also associated with a reduced risk of stroke, protection against loss of muscle mass, preservation of bone mineral density, and reduction in the formation of kidney stones. In addition, the antioxidants and vitamins in pumpkins could prevent degenerative damage to the eyes.”
  • How to cut, cook and peel a pumpkin
  • Nutrients of Pumpkin Seeds: “Even pumpkin seeds are a popular snack. Grocery stores often sell them both hulled and semi-hulled. They’re a good source of protein, magnesium, copper, and zinc.”
  • The Best Way to Salt Pumpkin Seeds

“The challenge is, how to get the salt inside the shells to the seeds? It’s easy enough to salt the outside of the shells, but if you want the salt to permeate to the seeds the method, I learned from my mother years ago does the trick.

Boil the seeds first in salted water, then toast them in the oven. This way the salt gets inside too. And you can control the amount of salt by how much you add to the water and how long you boil the seeds.”


Okay, now you know this product is in demand, why people love it, and that you can even charge a premium price for it. Think about what product you would sell. What would you make, what would you charge, how would you market it, who would you sell it to, where would you sell it?

These types of questions mimic those of chefs while determining new menu items, regardless of the time of the year. If you’d like to dive even further into the culinary life, consider Northwest Culinary Institute! To inquire about our program, please fill out the form on this page, and a representative would be happy to answer any questions you may have!