People are passionate about pie.
In fact, Datassential’s food and beverage insights found 78% of consumers said they love or like pie. The $2 billion category across shelf stable and frozen is one fortified not just by crust but also by strong emotions of nostalgia and comfort.
Enhanced by tradition and longevity, pie is a product that over-indexes with baby boomers and retirees and under indexes with millennials. Relative to perimeter desserts in the cake and cookie categories ($5 billion and $2.2 billion in current sales, respectively), perimeter pies underperform in comparison ($1.1 billion current sales).
Long known as a dessert to be shared, pie is synonymous with celebrations and coming together to enjoy favorites such as apple, cherry, pecan and pumpkin. Consumed outside the home, pie is the third-most common dessert offered on restaurant menus, according to Datassential.
By the numbers, pies are enjoying scattered growth in some sectors and seeing declines in others. Current sales of perimeter pies are $1.1 billion, a 5.5% dollar change vs. one year ago and a 5.6% change vs. two years ago. Center store pie sales account for $397.4 million, a 2.3% change vs. one year ago and a 16.1% change vs. two years ago. Current sales of frozen pie/pastry shells are $739.8 million, a 0.8% dip vs. a year ago, slowing a bit from the solid growth two years ago, which was an 11.3% change when stock-up shopping hit record levels.
Perimeter sales account for 50% of dollars, followed by frozen at 30% and snack-size pies at less than 8% in the category, which is a double digit decline from two years ago. The frozen category is lagging compared to the perimeter – up 1.9% vs. 5%.
Pie, like many other categories in the perimeter bakery, took a considerable hit during the pandemic. Department closures, low staffing levels and canceled celebrations quieted sales. Driven by a stocking-up mentality and an increased desire for indulgence, consumers looked for an alternative fix in frozen and center store.
By 2021, people were coming back to the store ready to partake in the fresh desserts from the perimeter bakery, with pies up 5% and holding steady. Frozen, on the other hand, has not sustained growth beyond the unique circumstances of 2020.
However, when it comes to online sales, frozen holds the potential to shine. Ecommerce is driving omnichannel growth in frozen pies, up 12%, a statistic in line with digital growth for food and beverage.
While 80% of dollars in the perimeter category are in store brand/private label, branded products also are making their mark. Kansas City, KS-based Tippins Gourmet Pies leads the branded pie category with $9.3 million in fruit, vegetable and nut pie sales. This is a $585,415 bump from the brand’s sales a year ago.
Although some dessert categories are showing growth in smaller and snack-sized serving options, the pie category is generally not one of them. In frozen, multi-serve is driving most sales in the category at roughly 84%. However, single serve is seeing more category growth, up 12%. In the perimeter, snack-size pies make up less than 8% of the category and have seen a 3% decline. This is also down by double digits vs. two years ago. In the center store aisles, however, snack pies are growing slightly, up 1%.
Accepted by consumers as a tried-and-true category, pie manufacturers may find their hands tied when it comes to exploring new flavors and innovation. This is shown through new items that account for only 15% of sales in the perimeter, according to IRI. In 2020, innovation contributed to a slightly larger portion of sales, and the top flavors of the year were apple (toffee apple streusel), pumpkin and cherry. The 2021 top flavors were strawberry, apple and lime.
The frozen category has also demonstrated limited innovation over the past four years, with only 5.6% of the category dollars coming from new items. The less fruit-forward, more indulgent top flavors for new products in the frozen category included caramel, chocolate brownie cream, lemon and confetti birthday cake.
“People want the standards, and they also have their favorites,” said Melissa Attobelli, principal, strategic solutions group for IRI. “Lack of innovation in the category could be because consumers tend to return to their traditional favorites rather than seeking out something new.”
Then again, offering something that’s more innovative could be a way to accommodate consumers with a variety of dietary restrictions as well as highlight seasonality and holiday collaborations with local providers.
Others might argue that consumers looking to purchase unique pies and crossover products such as galettes, hand and slab pies and cobblers are more likely to seek out an independent specialty pie shop rather than go to their local grocery provider. These are also the types of products consumers are more apt to pay a premium for if the pie is made with unique or upscale ingredients or one that is marketed as a limited-time offer.
“New flavors and forms of desserts, other than pies, are threats to the category as there’s been limited innovation in the space over the past four years,” Attobelli concluded. “However, the category growth remains steady and consistent from a core offering and seasonal perspective, so expect the category to continue to maintain, if not continue to steadily build.”
This story has been adapted from the April 2022 Q2 issue of Commercial Baking. Read the full story in the digital edition here.
