How the Public Lost Its Taste for Pizza Hut
At one time, Pizza Hut was the top choice for families and friends to indulge in its unlimited dining experience, unlimited salad bar, and make-your-own dessert.
Yet a declining number of diners are frequenting the brand currently, and it is reducing half of its UK locations after being rescued from insolvency for the second time this year.
I remember going Pizza Hut when I was a child,” says a young adult. “It was a tradition, you'd go on a Sunday – spend the whole day there.” But now, in her mid-twenties, she says “it's fallen out of favor.”
For a diner in her twenties, certain features Pizza Hut has been famous for since it started in the UK in the seventies are now less appealing.
“The way they do their all-you-can-eat and their salad bar, it appears that they are cutting corners and have inferior offerings... They're giving away so much food and you're like ‘How?’”
Because grocery costs have increased significantly, Pizza Hut's unlimited dining format has become increasingly pricey to operate. As have its locations, which are being cut from 132 to just over 60.
The business, in common with competitors, has also experienced its costs increase. Earlier this year, staffing costs increased due to rises in minimum wages and an rise in employer social security payments.
Chris, 36, and Joanne, 29 say they would often visit at Pizza Hut for a date “from time to time”, but now they choose a rival chain and think Pizza Hut is “too expensive”.
Based on your selection, Pizza Hut and Domino's prices are similar, notes an industry analyst.
Although Pizza Hut provides pickup and delivery through delivery platforms, it is losing out to major competitors which focus exclusively to this market.
“The rival chain has taken over the takeaway pizza sector thanks to aggressive marketing and frequent offers that make customers feel like they're saving money, when in reality the standard rates are quite high,” notes the specialist.
Yet for these customers it is justified to get their special meal delivered to their door.
“We absolutely dine at home now rather than we eat out,” comments one of the diners, echoing latest data that show a decrease in people visiting informal dining spots.
Over the summer, informal dining venues saw a notable decrease in diners compared to the previous year.
Additionally, one more competitor to restaurant and takeaway pizzas: the frozen or fresh pizza.
A hospitality expert, senior partner at a major consultancy, explains that not only have supermarkets been providing premium prepared pies for quite a while – some are even selling countertop ovens.
“Lifestyle changes are also having an impact in the popularity of quick-service brands,” states the expert.
The rising popularity of high protein diets has boosted sales at grilled chicken brands, while hitting sales of carb-heavy pizza, he adds.
Since people visit restaurants not as often, they may look for a more high-quality meal, and Pizza Hut's classic look with vinyl benches and nostalgic table settings can feel more dated than premium.
The “explosion of high-quality pizzerias” over the last 10 to 15 years, for example new entrants, has “dramatically shifted the consumer view of what excellent pie is,” explains the food expert.
“A light, fresh, easy-to-digest product with a carefully curated additions, not the excessively rich, thick and crowded pizzas of the past. That, I think, is what's led to Pizza Hut's struggles,” she comments.
“Why would anyone spend £17.99 on a small, substandard, disappointing pizza from a large brand when you can get a beautiful, masterfully-made traditional pie for less than ten pounds at one of the many real Italian restaurants around the country?
“It's a no-brainer.”
An independent operator, who runs Smokey Deez based in a regional area says: “It's not that stopped liking pizza – they just want higher quality at a fair price.”
Dan says his adaptable business can offer high-quality pie at reasonable rates, and that Pizza Hut faced challenges because it was unable to evolve with changing preferences.
According to an independent chain in a city in southwest England, the proprietor says the pizza market is broadening but Pizza Hut has not provided anything new.
“You now have individual slices, London pizza, new haven, fermented dough, Neapolitan, deep-dish – it's a delightful challenge for a pizza enthusiast to discover.”
Jack says Pizza Hut “should transform” as younger people don't have any sense of nostalgia or attachment to the brand.
In recent years, Pizza Hut's share has been divided and allocated to its fresher, faster competitors. To keep up its costly operations, it would have to charge more – which commentators say is difficult at a time when household budgets are shrinking.
The leadership of Pizza Hut's global operations said the buyout aimed “to safeguard our customer service and protect jobs where possible”.
It was explained its first focus was to continue operating at the surviving locations and delivery sites and to assist staff through the transition.
Yet with so much money going into operating its locations, it may be unable to allocate significant resources in its off-premise division because the sector is “complicated and working with existing external services comes at a cost”, experts say.
However, it's noted, reducing expenses by leaving competitive urban areas could be a effective strategy to adapt.