How the Public Lost Interest in Its Appetite for the Pizza Hut Chain
At one time, the popular pizza chain was the go-to for parents and children to indulge in its eat-as-much-as-you-like offering, endless salad selection, and make-your-own dessert.
Yet a declining number of diners are choosing the chain these days, and it is reducing 50% of its British restaurants after being acquired following financial trouble for the second instance this year.
“We used to go Pizza Hut when I was a child,” explains Prudence. “It was like a family thing, you'd go on a Sunday – turn it into an event.” But now, as a young adult, she says “it's not a thing anymore.”
In the view of 23-year-old Martina, the very elements Pizza Hut has been known and loved for since it started in the UK in the 1970s are now not-so-hot.
“The way they do their all-you-can-eat and their salad bar, it feels like they are cutting corners and have lower standards... They offer so much food and you're like ‘How?’”
As food prices have risen sharply, Pizza Hut's all-you-can-eat model has become increasingly pricey to run. As have its restaurants, which are being cut from a large number to a smaller figure.
The company, similar to other firms, has also seen its expenses rise. Earlier this year, labor expenses jumped due to higher minimum pay and an rise in employer taxes.
Chris, 36, and Joanne, 29 mention they frequently dined at Pizza Hut for a date “occasionally”, but now they choose another pizza brand and think Pizza Hut is “not good value”.
According to your selection, Pizza Hut and Domino's costs are similar, notes an industry analyst.
Although Pizza Hut provides takeaway and deliveries through third-party apps, it is missing out to larger chains which solely cater to the delivery sector.
“Domino's has managed to dominate the takeaway pizza sector thanks to aggressive marketing and constantly running deals that make customers feel like they're saving money, when in reality the original prices are on the higher side,” says the expert.
However for these customers it is justified to get their special meal delivered to their door.
“We definitely eat at home now instead of we eat out,” says Joanne, echoing recent statistics that show a decrease in people frequenting informal dining spots.
During the summer months, quick-service eateries saw a 6% drop in diners compared to the previous year.
There is also a further alternative to pizza from eateries: the supermarket pizza.
Will Hawkley, head of leisure and hospitality at a major consultancy, points out that not only have retailers been offering good-standard ready-to-bake pizzas for a long time – some are even promoting home-pizza ovens.
“Shifts in habits are also playing a factor in the success of quick-service brands,” comments the analyst.
The growing trend of protein-rich eating plans has increased sales at chicken shops, while hitting sales of dough-based meals, he continues.
Since people go out to eat more rarely, they may look for a more premium experience, and Pizza Hut's American-diner style with vinyl benches and red and white checked plastic table cloths can feel more retro than premium.
The rise of artisanal pizza places” over the last decade and a half, for example boutique chains, has “completely altered the general opinion of what excellent pie is,” notes the industry commentator.
“A thin, flavorful, gentle crust with a carefully curated additions, not the excessively rich, thick and crowded pizzas of the past. This, in my view, is what's led to Pizza Hut's decline,” she comments.
“Who would choose to spend £17.99 on a modest, low-quality, underwhelming pizza from a chain when you can get a beautiful, masterfully-made classic pizza for a lower price at one of the many authentic Italian pizzerias around the country?
“It's a no-brainer.”
Dan Puddle, who operates a small business based in a county in England says: “It's not that stopped liking pizza – they just want higher quality at a fair price.”
The owner says his adaptable business can offer high-quality pie at affordable costs, and that Pizza Hut struggled because it failed to adapt with new customer habits.
At Pizzarova in a UK location, owner Jack Lander says the pizza market is diversifying but Pizza Hut has not provided anything fresh.
“Currently available are individual slices, regional varieties, new haven, sourdough, Neapolitan, rectangular – it's a delightful challenge for a pizza enthusiast to explore.”
Jack says Pizza Hut “must rebrand” as the youth don't have any fond memories or attachment to the chain.
Over time, Pizza Hut's share has been divided and spread to its trendier, more nimble competitors. To sustain its high labor and location costs, it would have to charge more – which industry analysts say is tough at a time when family finances are tightening.
The managing director of Pizza Hut's international markets said the buyout aimed “to safeguard our guest experience and retain staff where possible”.
The executive stated its key goal was to continue operating at the surviving locations and off-premise points and to help employees through the restructure.
But with significant funds going into maintaining its outlets, it likely can't afford to spend heavily in its delivery service because the sector is “difficult and using existing third-party platforms comes at a expense”, commentators say.
Still, experts suggest, cutting its costs by exiting crowded locations could be a effective strategy to adjust.