How the Public Lost Interest in Its Craving for Pizza Hut
At one time, the popular pizza chain was the go-to for parents and children to indulge in its all-you-can-eat buffet, unlimited salad bar, and make-your-own dessert.
Yet not as many customers are frequenting the chain nowadays, and it is reducing 50% of its British outlets after being bought out of administration for the second instance this year.
It was common to visit Pizza Hut when I was a child,” explains Prudence. “It was a tradition, you'd go on a Sunday – spend the whole day there.” Today, as a young adult, she states “it's fallen out of favor.”
In the view of young customer Martina, the very elements Pizza Hut has been recognized for since it launched in the UK in the mid-20th century are now outdated.
“The manner in which they do their all-you-can-eat and their salad station, it seems as if they are cutting corners and have reduced quality... They're giving away so much food and you're like ‘How is that possible?’”
Because ingredient expenses have risen sharply, Pizza Hut's buffet-style service has become quite costly to operate. As have its restaurants, which are being reduced from a large number to just over 60.
The company, like many others, has also faced its operating costs rise. Earlier this year, labor expenses jumped due to higher minimum pay and an higher rate of employer social security payments.
Chris, 36, and Joanne, 29 mention they used to go at Pizza Hut for a date “from time to time”, but now they choose another pizza brand and think Pizza Hut is “not good value”.
According to your choices, Pizza Hut and Domino's costs are close, says a food expert.
While Pizza Hut does offer takeaway and deliveries through third-party apps, it is falling behind to larger chains which focus exclusively to this market.
“The rival chain has succeeded in leading the takeaway pizza sector thanks to aggressive marketing and frequent offers that make customers feel like they're finding a good deal, when in reality the standard rates are relatively expensive,” notes the expert.
Yet for Chris and Joanne it is justified to get their evening together sent directly.
“We definitely eat at home now instead of we eat out,” comments Joanne, reflecting current figures that show a decrease in people going to informal dining spots.
Over the summer, casual and fast-food restaurants saw a six percent decline in patrons compared to last summer.
Additionally, one more competitor to ordered-in pies: the frozen or fresh pizza.
Will Hawkley, global lead for leisure at a leading firm, explains that not only have retailers been offering premium ready-to-bake pizzas for years – some are even selling home-pizza ovens.
“Evolving preferences are also playing a factor in the performance of quick-service brands,” says the expert.
The growing trend of low-carb regimens has boosted sales at chicken shops, while affecting sales of dough-based meals, he adds.
As people go out to eat more rarely, they may look for a more high-quality meal, and Pizza Hut's classic look with booth seating and nostalgic table settings can feel more retro than premium.
The “explosion of high-quality pizzerias” over the last several years, such as popular brands, has “completely altered the public's perception of what excellent pie is,” explains the food expert.
“A crisp, airy, digestible pizza with a few choice toppings, not the massively greasy, heavy and overloaded pizzas of the past. This, in my view, is what's caused Pizza Hut's struggles,” she comments.
“What person would spend a high price on a modest, low-quality, underwhelming pizza from a large brand when you can get a stunning, expertly crafted traditional pie for a lower price at one of the many real Italian restaurants around the country?
“It's a no-brainer.”
Dan Puddle, who runs a pizza van based in a regional area says: “People haven’t stopped liking pizza – they just want improved value.”
The owner says his flexible operation can offer premium pizza at accessible prices, and that Pizza Hut had difficulty because it was unable to evolve with evolving tastes.
According to an independent chain in Bristol, owner Jack Lander says the industry is expanding but Pizza Hut has not provided anything innovative.
“You now have slice concepts, regional varieties, new haven, fermented dough, wood-fired, deep-dish – it's a heavenly minefield for a pie fan to try.”
He says Pizza Hut “needs to reinvent itself” as younger people don't have any sense of nostalgia or allegiance to the company.
Gradually, Pizza Hut's share has been divided and allocated to its trendier, more nimble competitors. To maintain its high labor and location costs, it would have to raise prices – which industry analysts say is challenging at a time when family finances are tightening.
The managing director of Pizza Hut's international markets said the rescue aimed “to ensure our customer service and protect jobs where possible”.
The executive stated its immediate priority was to maintain service at the surviving locations and delivery sites and to assist staff through the restructure.
Yet with so much money going into maintaining its outlets, it probably cannot to spend heavily in its takeaway operation because the sector is “complex and using existing delivery apps comes at a cost”, analysts say.
Still, experts suggest, reducing expenses by withdrawing from oversaturated towns and city centres could be a effective strategy to adjust.