Forget haunted houses and hayrides. ‘Immersive horror’ is the new way to get spooked

And so I found myself scouring the cobwebbed racks of the museum’s archives, investigating the onstage inferno of famed clarinetist Ace Marcellin. The room was a tomb, dark and claustrophobic. A glowing fog, unnaturally green as Midori, crept forth from a far corner. Freaky creaks and disembodied growls clashed with the metronome of my pulse: thwomp … thwomp …thwomp. On Newton’s desk, a code corresponded to Ace’s old LP. Another unlocked a briefcase containing a record player. A jaunty jazz tune crawled out of the speaker, filling the shadows with incongruously upbeat woodwinds, before contorting into a demonic whisper: “My name is …”

Per Catholic and Hollywood tradition, to properly exorcise a demon one must call it out directly. I never did catch this one’s name, though. Because despite Sandy and Ace being make-believe characters; despite the “archives” being a vacant room behind the third-floor food court at the Canal Place mall; despite knowing this weekend-long interactive mystery was a game featured as part of the sixth annual Overlook horror film festival—despite all this, when that hellish incantation unspooled into the darkness, reader, I was too scared to listen.

Scaring is monster business, one that was generating $1.1 billion in annual revenue pre-pandemic, according to the Haunted Attraction Association—and one no longer confined to the weeks around Halloween. In gentler times, all an enterprising pumpkin farmer had to do was loose a chainsaw-wielding actor on a hayride of screaming teens to generate thrills. Today “people want more, more, more,” says Justin Fix, creator of The Willows, the murder mystery that might result if, say, horror auteur Ari Aster (Hereditary, Midsommar) directed a reboot of Clue. Coproducer JT Swierczek describes it as a “deconstructed haunted house,” where family members lead guests to unnerving one-on-ones in the recesses of a gorgeously sinister circa-1918 Los Angeles mansion. “You ring the doorbell, a butler answers the door, and you’re literally in the show,” Swierczek says. “We don’t take people out of the world. Our ‘maid’ has to be able to pour wine.” She might also have a nervous breakdown in the dining room.

Courtesy of Universal Studios

“In immersive horror, you’re not just seated in a theater; the audience gets to feel like they have a role in the story,” says Taylor Winters, a transcatheter heart valve designer better known in the horror community as the founder of Haunting.net. His site, whose traffic has quintupled since its 2017 launch, ranks these experiences on an intensity scale from zero (“things you can take your mom to”) to 10 (“things that will leave you with a bruise or two”). In Santa Fe, Meow Wolf ’s interdimensional odyssey House of Eternal Return rates at the shallow end, while Salt Lake City’s Krusebel, a psychological grotesquerie with a required waiver and an optional safe word, earns a 10.

Themes and structures vary among these attractions, but the rich production values and intimate storytelling are the same. Winters borrows a comparison from his day job: “The big foray in medical devices is personalized medicine, devices tailored to customers. This is what we’re seeing in immersive horror, and people will pay exorbitant money for that.” One of 18 seats at the Willowses’ table costs $189; all access at the Overlook, $250. At Halloween Horror Nights at Universal Studios theme parks, guided “RIP” tours with front-of-the-line access start at $300 and routinely sell out. And fans aren’t just buying tickets to these experiences; they’re building vacations around them.

It wasn’t like this during the space’s nascency, when pioneering productions like Blackout and Sleep No More grew their audience and mystique through word of mouth. But in the 2010s, social media and experiential event marketing (Comic Con, South by Southwest) acted as accelerants, while a new wave of prestige horror media (The Walking Dead, The Babadook, Get Out) influenced producers and audiences. “A lot of other genres are realizing there are tools in the horror toolbox,” says Craig Engler, GM of streaming service Shudder. Neither Stranger Things nor The Haunting of Hill House, for example, is straight horror, but each has enough horror “tools” (and fans) to resonate in the haunting world.

Courtesy of Kate Russell/Meow Wolf

Universal began leveraging intellectual property from outside its own movies when it sprang Freddy (A Nightmare on Elm Street), Jason (Friday the 13th), and Leatherface (The Texas Chainsaw Massacre) on guests in 2007. For the theme parks, those familiar demons are “a great way to initiate people,” says senior show director Charles Gray, “getting them excited about properties they do know, then expanding the palette with original stories.” Originals at Universal this year include houses inhabited by bloodthirsty chupacabras and a coven of flapper witches. On the Universal IP side for 2022, guests will encounter the ghastly Grabber of The Black Phone, a screening of which I caught at the Overlook between hunting for clues to the Ace Marcellin whodunit.

The solution came on the penultimate day of the festival. As you’ve probably figured, Ace sold his soul to the devil, and that debt came due in one fiery bill collection. While the game’s final vignette didn’t conjure the fright of the archives, it was memorably bizarre, involving a Radio Shack–era computer, a snakelike clarinet, the offer of a Faustian bargain of my own (accepted!), and a talking house cat. I don’t even know how to describe it, which recalls something Swierczek tells me: “When you give guests these feelings they can’t explain to their friends and family; when they say, ‘You just gotta go,’ there’s no price too high.”

This article appears in the October/November 2022 issue of Fortune with the headline, “A spooked market.”