How the Public Lost Its Craving for the Pizza Hut Chain
In the past, the popular pizza chain was the top choice for families and friends to feast on its eat-as-much-as-you-like offering, help-yourself greens station, and self-serve ice-cream.
However a declining number of customers are visiting the brand nowadays, and it is shutting down a significant portion of its British restaurants after being bought out of administration for the second time this year.
It was common to visit Pizza Hut when I was a child,” notes a young adult. “It was a tradition, you'd go on a Sunday – turn it into an event.” However, at present, as a young adult, she comments “it's fallen out of favor.”
According to a diner in her twenties, some of the very things Pizza Hut has been known and loved for since it launched in the UK in the mid-20th century are now outdated.
“The manner in which they do their buffet and their salad bar, it seems as if they are lowering standards and have lower standards... They provide so much food and you're like ‘How?’”
Since food prices have risen sharply, Pizza Hut's buffet-style service has become increasingly pricey to run. As have its locations, which are being reduced from a large number to just over 60.
The company, similar to other firms, has also faced its expenses increase. Earlier this year, labor expenses jumped due to rises in minimum wages and an increase in employer social security payments.
Chris, 36, and Joanne, 29 explain they would often visit at Pizza Hut for a date “occasionally”, but now they choose a rival chain and think Pizza Hut is “not good value”.
According to your selection, Pizza Hut and Domino's prices are similar, explains a culinary author.
Although Pizza Hut provides pickup and delivery through delivery platforms, it is missing out to major competitors which specialize to the delivery sector.
“Domino's has managed to dominate the off-premise pizza industry thanks to aggressive marketing and ongoing discounts that make customers feel like they're getting a bargain, when in reality the base costs are relatively expensive,” says the expert.
Yet for the couple it is justified to get their special meal sent directly.
“We definitely eat at home now more than we eat out,” comments Joanne, reflecting current figures that show a drop in people going to casual and fast-food restaurants.
Over the summer, quick-service eateries saw a six percent decline in patrons compared to the year before.
Moreover, a further alternative to pizza from eateries: the cook-at-home oven pizza.
An industry leader, head of leisure and hospitality at a leading firm, points out that not only have grocery stores been offering good-standard oven-ready pizzas for quite a while – some are even promoting countertop ovens.
“Evolving preferences are also having an impact in the performance of quick-service brands,” says the analyst.
The increased interest of high protein diets has driven sales at chicken shops, while affecting sales of dough-based meals, he adds.
As people visit restaurants not as often, they may prefer a more upscale outing, and Pizza Hut's classic look with booth seating and nostalgic table settings can feel more dated than upmarket.
The growth of premium pizza outlets” over the last 10 to 15 years, such as popular brands, has “dramatically shifted the consumer view of what excellent pie is,” says the industry commentator.
“A light, fresh, easy-to-digest product with a carefully curated additions, not the massively greasy, heavy and overloaded pizzas of the past. That, I think, is what's resulted in Pizza Hut's decline,” she says.
“Who would choose to spend nearly eighteen pounds on a modest, low-quality, underwhelming pizza from a chain when you can get a stunning, expertly crafted classic pizza for less than ten pounds at one of the many traditional pizzerias around the country?
“It's an easy choice.”
An independent operator, who runs a small business based in a county in England explains: “People haven’t stopped liking pizza – they just want higher quality at a fair price.”
He says his adaptable business can offer gourmet pizza at affordable costs, and that Pizza Hut faced challenges because it failed to adapt with evolving tastes.
From the perspective of an independent chain in Bristol, the founder says the sector is expanding but Pizza Hut has not provided anything innovative.
“Currently available are slice concepts, artisanal styles, thin crust, artisan base, traditional Italian, deep-dish – it's a delightful challenge for a pizza-loving consumer to discover.”
He says Pizza Hut “must rebrand” as younger people don't have any sense of nostalgia or loyalty to the chain.
Over time, Pizza Hut's market has been fragmented and distributed to its more modern, agile rivals. To keep up its costly operations, it would have to charge more – which industry analysts say is tough at a time when household budgets are tightening.
The managing director of Pizza Hut's global operations said the rescue aimed “to safeguard our customer service and save employment where possible”.
The executive stated its key goal was to keep running at the open outlets and delivery sites and to assist staff through the transition.
But with large sums going into maintaining its outlets, it may be unable to allocate significant resources in its off-premise division because the industry is “complex and working with existing external services comes at a expense”, commentators say.
But, he adds, lowering overhead by leaving crowded locations could be a good way to adapt.