Category feature: Hot pastries

The much-loved-midnight-snack retailer Pie Face saw its end in 2014, in a spectacular collapse following a string of unprofitable stores.

The world of pie and savoury pastries looked bleak; year-on-year sales were dropping for Pie Face and they were millions of dollars in debt.

Ten years on from the global financial crisis that saw pies as one of the only categories in the convenience channel to sustain their market share, the strength of pies is still seen as they remain a classic Australian food. On average Australians consume 12 pies per person, per year. This doesn’t take into account pasties, sausage rolls, and other hot pastries.

Pie Face is set to see a revival in the convenience sector: United Petroleum, the Australian-owned petrol giant, bought the company in April with plans to implement the business into its petrol stations.

Australians eat hundreds of millions of pies each year so there must still be something about pies aside from their convenience that keeps us interested. What is the pieschology behind it?

PLAY Market Research found that, 69 per cent of the surveyed community at pies during meals at home, 57 per cent said as a convenience snack and 48 per cent said as a treat (other options were sports game and other).

The pie and pasty market is well suited to the convenience trade as it offers the flexibility of on-the-go or ‘dashboard dining’.

Pie and pasty sales through convenience are still driven more by tradesmen and young singles, but other consumers are increasingly being tempted as the movement towards quality increases along with the need for a convenient and tasty snack during a busy day.

Who ate all the pies?

The pastry packet was originally created as a way to house and cook meat but has since developed into an iconic single serving snack food, comparable to the USA’s hotdog or an Italian pizza.

It is a category that has been able to move with the times and maintain its relevance to today’s consumer. Manufacturers continue to play a key role in this as they include new flavours and use premium ingredients such as quality meats and gravies. Convenience retailers also play their part, with better category management, presentation and successful promotional offers all assisted in boosting sales.

To understand the consumer is a critical point of business and driving up sales; pies are purchased because they are quick, convenient, tasty, filling and are seen as great value.

According to the latest Roy Morgan report on pies, 9.4 million Australians (aged 14+) like to eat pies, equal to 47.5 per cent of the population; an increase of 4.9 per cent since 2013.

There is also a distinct gender skew among Australia’s pie eater; 57.4 per cent are men to 42.6 per cent women. If nothing else, this is a male-dominated pie chart.

South Australia has the highest amount of pie and pasty lovers, with 61.6 per cent of the population enjoying them. This is a whopping 8.2 per cent higher than Western Australia, where 53.4 per cent of people who like eating pies.

Source: Roy Morgan Single Source (Australia), October 2015-September 2016

PLAY Market Research said when purchasing savoury pastries, the surveyed community responded to show that 85 per cent of people selected quality as the most important factor when making a purchase.

Of these statistics, specific brands were cited as the least important factor in the decision.

Shopper Tracker data all noted that Hot Pastries is a top 10 category where shoppers will pay more for better quality product.

This suggests that consumers have a low sense of loyalty or specific affiliation to brands such as Mrs Macs, Patties and Vili’s.

What the consumer is after is the quality of the product and the brand attached to that quality has little to no relevance.

On-the-Go Food

An Australian staple in the grandstands and a go-to snack food that’s often purchased heated and ready-to-eat, pies and savoury pastries have always been most at home in the convenience sector.

Consumers are purchasing hot food with three key missions in mind- meals, snacks and with petrol. Research shows that pies sell well throughout the day; many stores are segmenting by time of day, as well as consumer base, in order to ensure that the range of products is always in tune with customer demand.

The 2015 Australasian Association of Conveniences Stores (AACS) report noted that the petrol and convenience (P&C) sector will always be a destination for hot on-the-go-food in the form of pies and sausage rolls, as they enable shoppers to quickly fill up the car with petrol and get something to eat.

On-the-go food continues to grow in popularity and the convenience store is in a good position to capitalise on this growth as customers increasingly turn to convenience to settle their hunger as they rush to the office, building site, sporting engagement or social appointment.

In times gone by, research has shown that most hot food purchases are spontaneous, so the right product needs to be provided, in the right place and at the right time.

Convenience retailer Jack & Co use in-store signage to alert customers when they are baking products. This technique is designed to encourage spontaneous purchases by offering the freshest and newest products available to customers.

Bundled value offers and the cross promotion of pies with beverages are also proven sales drivers.

Beauty is in the eye of the pie-holder

While it’s easy to suggest that manufacturers and retailers should stick to what they know, it would be foolish to ignore innovation as a point of reinvention, and as a tool to sell more pies.

From a typical beef pie, fillings have expanded to include more gourmet options and options suited to current trends in food i.e. vegans and vegetarians.

A spokesperson for the National Baking Industry Association (NBIA) said pies are an iconic food as the often hold many childhood memories.

“They are a part of everyday life for generations of Australians young and old,” they said.

“The humble, plain meat pie is gradually changing, becoming more sophisticated with different fillings including game meats, seafood, and vegetarian options.”

Ka Pies co-owner Adrian Apswoude said the marketplace for pies is changing.

“Australia is turning into a gourmet marketplace, and we’re looking for flavour…vegan pies shows that things are changing.”

Convenience stores with more options in their hot food range are going to have a better turnover of product than those without.

Manufacturers have worked hard to innovate and meet the demands of different sorts of pie customers and this expanded product range provides convenience stores with an opportunity to better appeal to customers and achieve a sales growth.

A new offering into the market is the Four’N Twenty Chilli Beef pie.

Four’N Twenty marketing manager Mario Matchado said the new flavour was developed for adventurous eaters.

“Chilli has been identified as one of the key condiment flavour trends for 2017 and beyond,” he said.

Knowing the market and the target consumer is a sure-fire way to drum up sales from both sides of the equation. Whether that is the manufacturer or the retailer, producing and purchasing product suited to the demographic.

An interesting example of this in action is Garlos Pies who last year was selling its ‘Muscle Pie’ in selected gym around Sydney. The pie was marketed as a high protein and convenient gym bulking snack.

Between a pie and a hard place

When PLAY Market Research asked the community for their preference on either pies or sausage rolls, they reported a fairly even split with 58 per cent voting pie and 42 per cent voting sausage roll.

This fact is surprising considering the sausage roll is less of an iconic Australian food but appears to have a similar pull in consumption to the meat pie.

Makers and manufacturers also have to face the facts; Australians are looking for healthier options when it comes to snacking.

PLAY Market Research reported that of those surveyed, 46 per cent said their consumption of pies and savoury pastries had stayed the same over the last five years; 31 per cent had increased and 23 per cent had reduced their consumption.

Of those who said they reduced their intake, the most common reason was changing eating habits in a bid to make healthier choices.

One person surveyed said: “I’m attempting to eat fewer processed foods and reduce my carbohydrate intake”.

Does this mean there is a potential market for lighter and healthier options within the category?

Smaller portion sizes are an opportunity to attract a new group of customers; the smaller size will have greater appeal to the health conscious and assist with portion control.


In 2015 Australians ate 270 million pies so what does the market share actually look like?

The 2016 AACS report, released in early May, reported that hot pastries continued to be the staple of the on-the-go food sector, rising 11.7 per cent in dollar value and 9.6 per cent in units sold and equalling 40 per cent of the dollar share of the category.

The on-the-go channel also saw a steady rise in 2016 to 18.3 per cent to 13 per cent in 2015.

With pies and pastries doing so well across the various brands in conveniences stores, there are definitely enough pieces of this pie to share around, all coming together to form a recipe for success.


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