How the Nation Lost Interest in Its Craving for the Pizza Hut Chain
At one time, Pizza Hut 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 a declining number of customers are choosing the chain nowadays, and it is shutting down 50% of its UK locations after being acquired following financial trouble for the second instance this calendar year.
I remember going Pizza Hut when I was a child,” explains a young adult. “It was a regular outing, you'd go on a Sunday – make a day of it.” Today, in her mid-twenties, she comments “it's no longer popular.”
For 23-year-old Martina, certain features Pizza Hut has been known and loved for since it opened in the UK in the seventies are now outdated.
“How they do their all-you-can-eat and their salad bar, it seems as if they are cheapening on their quality and have lower standards... They're giving away so much food and you're like ‘How is that possible?’”
As food prices have risen sharply, Pizza Hut's unlimited dining format has become quite costly to run. The same goes for its outlets, which are being reduced from over 130 to just over 60.
The business, in common with competitors, has also faced its operating costs go up. In April this year, staffing costs rose due to higher minimum pay and an rise in employer taxes.
Chris, 36, and Joanne, 29 say they used to go at Pizza Hut for a date “occasionally”, but now they choose a rival chain and think Pizza Hut is “too expensive”.
According to your choices, Pizza Hut and Domino's costs are similar, explains a culinary author.
While Pizza Hut has takeaway and deliveries through third-party apps, it is missing out to big rivals which specialize to the delivery sector.
“Another pizza company has succeeded in leading the delivery market thanks to aggressive marketing and frequent offers that make consumers feel like they're getting a bargain, when in reality the original prices are quite high,” notes the analyst.
However for Chris and Joanne it is acceptable to get their date night delivered to their door.
“We definitely eat at home now instead of we eat out,” says one of the diners, matching recent statistics that show a drop in people frequenting casual and fast-food restaurants.
During the summer months, quick-service eateries saw a six percent decline in customers compared to the previous year.
Additionally, another rival to restaurant and takeaway pizzas: the cook-at-home oven pizza.
Will Hawkley, senior partner at a leading firm, explains that not only have supermarkets been offering high-quality oven-ready pizzas for quite a while – some are even promoting pizza-making appliances.
“Lifestyle changes are also playing a factor in the performance of quick-service brands,” comments the expert.
The growing trend of high protein diets has increased sales at chicken shops, while hitting sales of carb-heavy pizza, he continues.
As people visit restaurants more rarely, they may look for a more high-quality meal, and Pizza Hut's American-diner style with vinyl benches and traditional décor can feel more dated than premium.
The “explosion of artisanal pizza places” over the last 10 to 15 years, including boutique chains, has “fundamentally changed the public's perception of what quality pizza is,” says the industry commentator.
“A light, fresh, easy-to-digest product with a carefully curated additions, not the overly oily, dense and piled-high pizzas of the past. That, arguably, is what's resulted in Pizza Hut's struggles,” she states.
“Why would anyone spend nearly eighteen pounds on a tiny, mediocre, unsatisfying pizza from a franchise when you can get a stunning, expertly crafted classic pizza for under a tenner at one of the many authentic Italian pizzerias around the country?
“It's a no-brainer.”
A mobile pizza vendor, who operates Smokey Deez based in Suffolk comments: “It's not that stopped liking pizza – they just want improved value.”
Dan says his adaptable business can offer gourmet pizza at accessible prices, and that Pizza Hut faced challenges because it failed to adapt with new customer habits.
From the perspective of an independent chain in a city in southwest England, the founder says the sector is diversifying but Pizza Hut has not provided anything new.
“You now have by-the-slice options, London pizza, thin crust, artisan base, wood-fired, rectangular – it's a heavenly minefield for a pie fan to try.”
The owner says Pizza Hut “must rebrand” as the youth don't have any emotional connection or loyalty to the chain.
In recent years, Pizza Hut's customer base has been sliced up and spread to its fresher, faster alternatives. To sustain its high labor and location costs, it would have to increase costs – which commentators say is tough at a time when personal spending are decreasing.
The leadership of Pizza Hut's international markets said the acquisition aimed “to safeguard our guest experience and retain staff where possible”.
It was explained its first focus was to maintain service at the surviving locations and delivery sites and to support colleagues through the change.
Yet with significant funds going into running its restaurants, it may be unable to allocate significant resources in its off-premise division because the sector is “difficult and partnering with existing delivery apps comes at a expense”, experts say.
However, it's noted, cutting its costs by exiting oversaturated towns and city centres could be a effective strategy to adjust.