Why the Country Lost Its Taste for the Pizza Hut Chain
At one time, the popular pizza chain was the top choice for parents and children to indulge in its all-you-can-eat buffet, endless salad selection, and make-your-own dessert.
But not as many patrons are frequenting the restaurant these days, and it is reducing a significant portion of its UK locations after being acquired following financial trouble for the second occasion this year.
I remember going Pizza Hut when I was a child,” says one London shopper. “It was a regular outing, you'd go on a Sunday – make a day of it.” But now, in her mid-twenties, she says “it's fallen out of favor.”
In the view of young customer Martina, 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 less appealing.
“How they do their all-you-can-eat and their salad station, it appears that they are cutting corners and have lower standards... They're giving away so much food and you're like ‘How is that possible?’”
Because food prices have increased significantly, Pizza Hut's buffet-style service has become quite costly to run. Similarly, its outlets, which are being reduced from a large number to a smaller figure.
The company, like many others, has also experienced its costs increase. Earlier this year, staffing costs jumped due to rises in minimum wages and an increase in employer social security payments.
A couple in their thirties and twenties say they would often visit at Pizza Hut for a date “every now and then”, but now they order in Domino's and think Pizza Hut is “very overpriced”.
Based on your choices, Pizza Hut and Domino's costs are similar, notes a food expert.
Even though Pizza Hut provides takeaway and deliveries through delivery platforms, it is falling behind to big rivals which focus exclusively to off-premise dining.
“Another pizza company has succeeded in leading the off-premise pizza industry thanks to aggressive marketing and frequent offers that make consumers feel like they're finding a good deal, when in reality the original prices are on the higher side,” explains the expert.
However for these customers it is acceptable to get their evening together brought to their home.
“We absolutely dine at home now rather than we eat out,” says one of the diners, echoing recent statistics that show a decrease in people visiting quick-service eateries.
Over the summer, quick-service eateries saw a notable decrease in customers compared to last summer.
Additionally, one more competitor to restaurant and takeaway pizzas: the cook-at-home oven pizza.
Will Hawkley, senior partner at a major consultancy, notes that not only have retailers been providing high-quality prepared pies for years – some are even selling countertop ovens.
“Lifestyle changes are also playing a factor in the success of fast-food chains,” says Mr. Hawkley.
The growing trend of high protein diets has boosted sales at grilled chicken brands, while reducing sales of carb-heavy pizza, he continues.
Since people visit restaurants more rarely, they may look for a more upscale outing, and Pizza Hut's American-diner style with comfortable booths and red and white checked plastic table cloths can feel more old-fashioned than premium.
The rise of artisanal pizza places” over the last 10 to 15 years, for example new entrants, has “completely altered the consumer view of what excellent pie is,” notes the culinary analyst.
“A thin, flavorful, gentle crust with a few choice toppings, not the excessively rich, thick and crowded pizzas of the past. This, in my view, is what's resulted in Pizza Hut's struggles,” she says.
“What person would spend £17.99 on a small, substandard, disappointing pizza from a franchise when you can get a gorgeous, skillfully prepared Margherita for a lower price at one of the many authentic Italian pizzerias around the country?
“It's a no-brainer.”
A mobile pizza vendor, who owns a small business based in a county in England comments: “It's not that lost interest in pizza – they just want higher quality at a fair price.”
He says his adaptable business can offer premium pizza at reasonable rates, and that Pizza Hut struggled because it failed to adapt with changing preferences.
At a small pizza brand in a UK location, the proprietor says the industry is broadening but Pizza Hut has failed to offer anything fresh.
“You now have individual slices, regional varieties, new haven, sourdough, traditional Italian, deep-dish – it's a heavenly minefield for a pizza enthusiast to explore.”
The owner says Pizza Hut “needs to reinvent itself” as the youth don't have any emotional connection or attachment to the chain.
Over time, Pizza Hut's share has been sliced up and spread to its more modern, agile competitors. To keep up its high labor and location costs, it would have to increase costs – which industry analysts say is difficult at a time when household budgets are decreasing.
The leadership of Pizza Hut's international markets said the acquisition aimed “to ensure our guest experience and retain staff where possible”.
He said its first focus was to continue operating at the surviving locations and off-premise points and to help employees through the transition.
However with significant funds going into operating its locations, it likely can't afford to invest too much in its takeaway operation because the industry is “difficult and working with existing delivery apps comes at a price”, analysts say.
However, it's noted, reducing expenses by leaving competitive urban areas could be a good way to adapt.