Why the Nation Lost Interest in Its Appetite for Pizza Hut
Once, Pizza Hut was the favorite for groups and loved ones to feast on its eat-as-much-as-you-like offering, unlimited salad bar, and self-serve ice-cream.
But a declining number of customers are visiting the chain these days, and it is shutting down half of its British locations after being rescued from insolvency for the second instance this calendar year.
I remember going Pizza Hut when I was a child,” says Prudence. “It was like a family thing, you'd go on a Sunday – spend the whole day there.” Today, in her mid-twenties, she comments “it's fallen out of favor.”
For young customer Martina, some of the very things Pizza Hut has been known and loved for since it launched in the UK in the seventies are now not-so-hot.
“How they do their all-you-can-eat and their salad station, it appears that they are cutting corners and have lower standards... They're giving away so much food and you're like ‘How?’”
As food prices have risen sharply, Pizza Hut's buffet-style service has become very expensive to run. As have its locations, which are being reduced from over 130 to 64.
The chain, in common with competitors, has also experienced its operating costs go up. This spring, employee wages rose due to rises in minimum wages and an rise in employer national insurance contributions.
Chris, 36, and Joanne, 29 explain they would often visit at Pizza Hut for a date “from time to time”, but now they order in another pizza brand and think Pizza Hut is “not good value”.
Depending on your choices, Pizza Hut and Domino's costs are comparable, says a culinary author.
While Pizza Hut does offer off-premise options through external services, it is falling behind to major competitors which solely cater to off-premise dining.
“The rival chain has taken over the delivery market thanks to intensive advertising and frequent offers that make shoppers feel like they're finding a good deal, when in reality the original prices are on the higher side,” says the analyst.
Yet for these customers it is worth it to get their date night delivered to their door.
“We absolutely dine at home now instead of we eat out,” says Joanne, echoing current figures that show a decline in people visiting quick-service eateries.
During the summer months, quick-service eateries saw a 6% drop in diners compared to last summer.
Additionally, a further alternative to pizza from eateries: the supermarket pizza.
A hospitality expert, head of leisure and hospitality at a leading firm, notes that not only have supermarkets been providing high-quality ready-to-bake pizzas for a long time – some are even selling countertop ovens.
“Evolving preferences are also playing a factor in the success of casual eateries,” states the expert.
The rising popularity of high protein diets has boosted sales at chicken shops, while reducing sales of high-carbohydrate options, he continues.
As people dine out not as often, 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 dated than premium.
The growth of high-quality pizzerias” over the last decade and a half, such as boutique chains, has “fundamentally changed the public's perception of what quality pizza is,” notes the food expert.
“A crisp, airy, digestible pizza with a few choice toppings, not the overly oily, dense and piled-high pizzas of the past. This, in my view, is what's caused Pizza Hut's struggles,” she says.
“Who would choose to spend nearly eighteen pounds on a modest, low-quality, underwhelming pizza from a large brand when you can get a gorgeous, skillfully prepared Margherita for a lower price at one of the many authentic Italian pizzerias around the country?
“It's an easy choice.”
Dan Puddle, who runs a pizza van based in Suffolk says: “It's not that fallen out of love with pizza – they just want better pizza for their money.”
Dan says his adaptable business can offer premium pizza at accessible prices, and that Pizza Hut struggled because it could not keep up with changing preferences.
From the perspective of a small pizza brand in Bristol, owner Jack Lander says the pizza market is expanding but Pizza Hut has not provided anything new.
“You now have individual slices, artisanal styles, thin crust, fermented dough, Neapolitan, Detroit – it's a delightful challenge for a pie fan to try.”
The owner says Pizza Hut “needs to reinvent itself” as newer generations don't have any sense of nostalgia or loyalty to the brand.
In recent years, Pizza Hut's customer base has been fragmented and spread to its more modern, agile rivals. To maintain its costly operations, it would have to increase costs – which industry analysts say is challenging at a time when household budgets are shrinking.
The managing director of Pizza Hut's international markets said the buyout aimed “to safeguard our guest experience and protect jobs where possible”.
He said its key goal was to maintain service at the open outlets and off-premise points and to support colleagues through the change.
But with large sums going into maintaining its outlets, it probably cannot to allocate significant resources in its delivery service because the market is “complicated and working with existing external services comes at a price”, experts say.
However, it's noted, reducing expenses by withdrawing from crowded locations could be a good way to evolve.