How the Nation Lost Its Appetite for Pizza Hut
Once, Pizza Hut was the top choice for parents and children to feast on its all-you-can-eat buffet, endless salad selection, and self-serve ice-cream.
However not as many customers are frequenting the chain these days, and it is shutting down a significant portion of its UK locations after being acquired following financial trouble for the second occasion this year.
“We used to go Pizza Hut when I was a child,” explains Prudence. “It was a tradition, you'd go on a Sunday – turn it into an event.” But now, in her mid-twenties, she says “it's not a thing anymore.”
According to young customer Martina, some of the very things Pizza Hut has been famous for since it opened in the UK in the mid-20th century are now not-so-hot.
“The manner in which they do their all-you-can-eat and their salad station, it feels like they are lowering standards and have reduced quality... They provide so much food and you're like ‘How can they?’”
Because ingredient expenses have soared, Pizza Hut's all-you-can-eat model has become quite costly to maintain. The same goes for its outlets, which are being cut from a large number to 64.
The business, like many others, has also experienced its operating costs go up. This spring, employee wages jumped due to higher minimum pay and an rise in employer social security payments.
A couple in their thirties and twenties mention they would often visit at Pizza Hut for a date “every now and then”, but now they choose Domino's and think Pizza Hut is “too expensive”.
Based on your selection, Pizza Hut and Domino's rates are similar, explains a food expert.
While Pizza Hut has pickup and delivery through external services, it is falling behind to larger chains which focus exclusively to off-premise dining.
“Another pizza company has managed to dominate the off-premise pizza industry thanks to aggressive marketing and ongoing discounts that make customers feel like they're finding a good deal, when in reality the original prices are relatively expensive,” says the analyst.
However for the couple it is worth it to get their date night delivered to their door.
“We definitely eat at home now more than we eat out,” comments Joanne, reflecting current figures that show a decline in people visiting quick-service eateries.
Over the summer, quick-service eateries saw a 6% drop in customers compared to the previous year.
Additionally, another rival to pizza from eateries: the frozen or fresh pizza.
An industry leader, head of leisure and hospitality at a leading firm, notes that not only have supermarkets been selling high-quality ready-to-bake pizzas for years – some are even offering countertop ovens.
“Lifestyle changes are also having an impact in the popularity of casual eateries,” comments Mr. Hawkley.
The rising popularity of low-carb regimens has driven sales at grilled chicken brands, while affecting sales of carb-heavy pizza, 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 traditional décor can feel more retro than luxurious.
The rise of premium pizza outlets” over the last 10 to 15 years, including new entrants, has “fundamentally changed the consumer view of what quality pizza is,” notes the food expert.
“A thin, flavorful, gentle crust with a carefully curated additions, not the overly oily, dense and piled-high pizzas of the past. This, in my view, is what's led to Pizza Hut's downfall,” she says.
“What person would spend nearly eighteen pounds on a small, substandard, disappointing pizza from a large brand when you can get a beautiful, masterfully-made classic pizza for less than ten pounds at one of the many authentic Italian pizzerias around the country?
“It's a no-brainer.”
An independent operator, who runs Smokey Deez based in Suffolk explains: “The issue isn’t that fallen out of love with pizza – they just want improved value.”
Dan says his mobile setup can offer gourmet pizza at reasonable rates, and that Pizza Hut had difficulty because it failed to adapt with new customer habits.
According to a small pizza brand in Bristol, the founder says the industry is diversifying but Pizza Hut has neglected to introduce anything new.
“Currently available are slice concepts, regional varieties, new haven, sourdough, Neapolitan, rectangular – it's a heavenly minefield for a pizza enthusiast to discover.”
The owner says Pizza Hut “needs to reinvent itself” as newer generations don't have any sense of nostalgia or attachment to the company.
In recent years, Pizza Hut's market has been fragmented and distributed to its trendier, more nimble alternatives. To sustain its costly operations, it would have to raise prices – which industry analysts say is challenging at a time when family finances are decreasing.
The managing director of Pizza Hut's overseas branches said the acquisition aimed “to protect our guest experience and protect jobs where possible”.
He said its key goal was to maintain service at the surviving locations and off-premise points and to help employees through the change.
Yet with so much money going into operating its locations, it probably cannot to allocate significant resources in its takeaway operation because the industry is “difficult and partnering with existing third-party platforms comes at a price”, commentators say.
Still, experts suggest, reducing expenses by leaving crowded locations could be a smart move to adapt.