How the Public Lost Interest in Its Taste for Pizza Hut
In the past, the popular pizza chain was the top choice for families and friends to feast on its all-you-can-eat buffet, unlimited salad bar, and ice cream with toppings.
Yet not as many customers are choosing the restaurant currently, and it is shutting down half of its UK locations after being bought out of administration for the second occasion this year.
It was common to visit Pizza Hut when I was a child,” notes one London shopper. “It was like a family thing, you'd go on a Sunday – make a day of it.” Today, aged 24, she states “it's no longer popular.”
For young customer Martina, certain features Pizza Hut has been known and loved for since it opened in the UK in the seventies are now not-so-hot.
“The manner in which they do their all-you-can-eat and their salad bar, it seems as if they are cutting corners and have reduced quality... They offer so much food and you're like ‘How can they?’”
Because food prices have soared, Pizza Hut's buffet-style service has become increasingly pricey to run. The same goes for its outlets, which are being reduced from over 130 to 64.
The business, in common with competitors, has also experienced its costs go up. Earlier this year, employee wages increased due to increases in the legal wage floor and an higher rate of employer national insurance contributions.
Chris, 36, and Joanne, 29 explain they used to go at Pizza Hut for a date “from time to time”, but now they get delivery from Domino's and think Pizza Hut is “not good value”.
Based on your selection, Pizza Hut and Domino's costs are similar, explains a food expert.
Even though Pizza Hut does offer takeaway and deliveries through external services, it is losing out to big rivals which focus exclusively to this market.
“Domino's has managed to dominate the delivery market thanks to intensive advertising and ongoing discounts that make customers feel like they're finding a good deal, when in reality the base costs are quite high,” explains the analyst.
But for the couple it is acceptable to get their evening together delivered to their door.
“We definitely eat at home now instead of we eat out,” says one of the diners, echoing latest data that show a decrease in people frequenting quick-service eateries.
Over the summer, casual and fast-food restaurants saw a notable decrease in diners compared to last summer.
Moreover, a further alternative to pizza from eateries: the supermarket pizza.
A hospitality expert, head of leisure and hospitality at an advisory group, explains that not only have supermarkets been providing premium prepared pies for quite a while – some are even offering countertop ovens.
“Lifestyle changes are also contributing in the performance of quick-service brands,” says Mr. Hawkley.
The increased interest of high protein diets has driven sales at poultry outlets, while reducing sales of carb-heavy pizza, he notes.
As people go out to eat more rarely, they may look for a more upscale outing, and Pizza Hut's retro theme with booth seating and red and white checked plastic table cloths can feel more dated than upmarket.
The growth of premium pizza outlets” over the last several years, including boutique chains, has “dramatically shifted the general opinion of what excellent pie is,” says the culinary analyst.
“A thin, flavorful, gentle crust with a select ingredients, not the overly oily, dense and piled-high pizzas of the past. This, in my view, is what's caused Pizza Hut's downfall,” 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 beautiful, masterfully-made Margherita for less than ten pounds at one of the many real Italian restaurants around the country?
“It's a no-brainer.”
Dan Puddle, who owns Smokey Deez based in Suffolk comments: “People haven’t fallen out of love with pizza – they just want higher quality at a fair price.”
Dan says his flexible operation can offer gourmet pizza at reasonable rates, and that Pizza Hut faced challenges because it could not keep up with evolving tastes.
According to an independent chain in a city in southwest England, the founder says the sector is broadening but Pizza Hut has not provided anything innovative.
“You now have slice concepts, London pizza, new haven, artisan base, Neapolitan, rectangular – it's a heavenly minefield for a pie fan to try.”
Jack says Pizza Hut “must rebrand” as newer generations don't have any emotional connection or allegiance to the company.
Over time, Pizza Hut's market has been fragmented and allocated to its trendier, more nimble alternatives. To keep up its costly operations, it would have to raise prices – which experts say is difficult at a time when household budgets are tightening.
The managing director of Pizza Hut's international markets said the acquisition aimed “to safeguard our guest experience and save employment where possible”.
He said its immediate priority was to continue operating at the surviving locations and delivery sites and to help employees through the restructure.
Yet with large sums going into maintaining its outlets, it may be unable to spend heavily in its off-premise division because the market is “difficult and using existing third-party platforms comes at a expense”, commentators say.
However, it's noted, lowering overhead by withdrawing from crowded locations could be a smart move to adjust.