Why the Public Lost Its Craving for the Pizza Hut Chain
In the past, Pizza Hut was the favorite for families and friends to indulge in its unlimited dining experience, help-yourself greens station, and make-your-own dessert.
Yet a declining number of patrons are choosing the restaurant these days, and it is closing half of its UK restaurants after being acquired following financial trouble for the second instance this calendar year.
It was common to visit Pizza Hut when I was a child,” explains Prudence. “It was a regular outing, you'd go on a Sunday – turn it into an event.” Today, aged 24, she states “it's fallen out of favor.”
According to 23-year-old Martina, some of the very things Pizza Hut has been known and loved for since it opened in the UK in the seventies are now less appealing.
“The way they do their buffet and their salad bar, it feels like they are cutting corners and have lower standards... They provide so much food and you're like ‘How can they?’”
Because ingredient expenses have soared, Pizza Hut's unlimited dining format has become very expensive to operate. As have its locations, which are being cut from 132 to just over 60.
The company, similar to other firms, has also experienced its operating costs increase. This spring, employee wages jumped due to increases in the legal wage floor and an increase in employer national insurance contributions.
Two diners explain they would often visit at Pizza Hut for a date “occasionally”, but now they get delivery from another pizza brand and think Pizza Hut is “very overpriced”.
According to your order, Pizza Hut and Domino's costs are similar, explains a food expert.
Although Pizza Hut does offer takeaway and deliveries through third-party apps, it is missing out to major competitors which specialize to this market.
“Domino's has succeeded in leading the delivery market thanks to intensive advertising and constantly running deals that make consumers feel like they're getting a bargain, when in reality the original prices are quite high,” explains the analyst.
But for Chris and Joanne it is acceptable to get their evening together sent directly.
“We definitely eat at home now more than we eat out,” says Joanne, reflecting current figures that show a drop in people visiting casual and fast-food restaurants.
In the warmer season, casual and fast-food restaurants saw a 6% drop in patrons compared to last summer.
Additionally, one more competitor to pizza from eateries: the supermarket pizza.
Will Hawkley, head of leisure and hospitality at a major consultancy, notes that not only have supermarkets been selling good-standard prepared pies for quite a while – some are even promoting pizza-making appliances.
“Lifestyle changes are also playing a factor in the success of casual eateries,” states the analyst.
The increased interest of low-carb regimens has driven sales at grilled chicken brands, while reducing sales of high-carbohydrate options, he notes.
As people dine out more rarely, they may seek out a more premium experience, and Pizza Hut's American-diner style with comfortable booths and nostalgic table settings can feel more old-fashioned than upmarket.
The “explosion of artisanal pizza places” over the last decade and a half, including new entrants, has “dramatically shifted the public's perception of what quality pizza is,” notes the food expert.
“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 led to Pizza Hut's downfall,” she states.
“Who would choose to spend a high price on a small, substandard, disappointing pizza from a large brand when you can get a stunning, expertly crafted Margherita for a lower price at one of the many authentic Italian pizzerias around the country?
“The decision is simple.”
An independent operator, who owns a small business based in a regional area says: “The issue isn’t that stopped liking pizza – they just want improved value.”
The owner says his adaptable business can offer gourmet pizza at reasonable rates, and that Pizza Hut faced challenges because it could not keep up with changing preferences.
At an independent chain in a city in southwest England, the founder says the pizza market is broadening but Pizza Hut has neglected to introduce anything innovative.
“Currently available are by-the-slice options, artisanal styles, thin crust, fermented dough, Neapolitan, rectangular – it's a heavenly minefield for a pizza-loving consumer to explore.”
Jack says Pizza Hut “must rebrand” as younger people don't have any sense of nostalgia or attachment to the company.
Over time, Pizza Hut's customer base has been fragmented and distributed to its trendier, more nimble rivals. To keep up its costly operations, it would have to raise prices – which experts say is tough at a time when personal spending are decreasing.
A senior executive of Pizza Hut's overseas branches said the buyout aimed “to ensure our dining experience and protect jobs where possible”.
It was explained its key goal was to keep running at the surviving locations and takeaway hubs and to support colleagues through the restructure.
However with significant funds going into running its restaurants, it may be unable to spend heavily in its delivery service because the market is “complex and partnering with existing external services comes at a price”, commentators say.
However, it's noted, reducing expenses by exiting competitive urban areas could be a effective strategy to adjust.