How the Public Turned Away from Its Appetite for the Pizza Hut Chain
At one time, the popular pizza chain was the top choice for groups and loved ones to enjoy its all-you-can-eat buffet, help-yourself greens station, and make-your-own dessert.
But fewer patrons are choosing the restaurant these days, and it is shutting down half of its UK locations after being rescued from insolvency for the second instance this year.
“We used to go Pizza Hut when I was a child,” says a young adult. “It was a tradition, you'd go on a Sunday – make a day of it.” However, at present, aged 24, she states “it's no longer popular.”
In the view of 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.
“The way they do their all-you-can-eat and their salad station, it seems as if they are lowering standards and have reduced quality... They provide so much food and you're like ‘How is that possible?’”
Since grocery costs have increased significantly, Pizza Hut's all-you-can-eat model has become very expensive to run. As have its locations, which are being sliced from 132 to just over 60.
The chain, in common with competitors, has also experienced its operating costs go up. In April this year, labor expenses jumped due to higher minimum pay and an higher rate of employer social security payments.
Chris, 36, and Joanne, 29 say they frequently dined at Pizza Hut for a date “occasionally”, but now they order in another pizza brand and think Pizza Hut is “not good value”.
Based on your order, Pizza Hut and Domino's prices are similar, explains a food expert.
Although Pizza Hut provides off-premise options through delivery platforms, it is missing out to larger chains which specialize to the delivery sector.
“Domino's has managed to dominate the off-premise pizza industry thanks to aggressive marketing and constantly running deals that make customers feel like they're saving money, when in reality the standard rates are quite high,” explains the analyst.
Yet for these customers it is acceptable to get their date night delivered to their door.
“We definitely eat at home now rather than we eat out,” says the female customer, matching current figures that show a decrease in people frequenting informal dining spots.
During the summer months, quick-service eateries saw a six percent decline in diners compared to last summer.
Additionally, another rival to pizza from eateries: the supermarket pizza.
An industry leader, head of leisure and hospitality at a leading firm, notes that not only have supermarkets been offering premium prepared pies for years – some are even promoting home-pizza ovens.
“Lifestyle changes are also contributing in the success of fast-food chains,” states the expert.
The rising popularity of low-carb regimens has increased sales at chicken shops, while affecting sales of dough-based meals, he continues.
Because people visit restaurants not as often, they may look for a more upscale outing, and Pizza Hut's American-diner style with booth seating and nostalgic table settings can feel more dated than upmarket.
The “explosion of high-quality pizzerias” over the last several years, for example new entrants, has “fundamentally changed the public's perception of what excellent pie is,” notes the food expert.
“A crisp, airy, digestible pizza with a carefully curated additions, not the excessively rich, thick and crowded pizzas of the past. That, arguably, is what's resulted in Pizza Hut's downfall,” she says.
“Why would anyone spend £17.99 on a tiny, mediocre, unsatisfying pizza from a chain when you can get a gorgeous, skillfully prepared classic pizza for less than ten pounds at one of the many authentic Italian pizzerias around the country?
“It's a no-brainer.”
Dan Puddle, who operates Smokey Deez based in Suffolk says: “It's not that lost interest in pizza – they just want improved value.”
Dan says his mobile setup can offer high-quality pie at affordable costs, and that Pizza Hut struggled because it could not keep up with changing preferences.
At Pizzarova in a UK location, the proprietor says the industry is diversifying but Pizza Hut has neglected to introduce anything fresh.
“There are now by-the-slice options, artisanal styles, thin crust, artisan base, traditional Italian, Detroit – it's a delightful challenge for a pizza enthusiast to explore.”
He says Pizza Hut “should transform” as newer generations don't have any emotional connection or attachment to the brand.
In recent years, Pizza Hut's customer base has been sliced up and allocated to its trendier, more nimble rivals. To keep up its expensive staffing and restaurants, it would have to increase costs – which experts say is tough at a time when personal spending are shrinking.
The managing director of Pizza Hut's overseas branches said the acquisition aimed “to ensure our dining experience and save employment where possible”.
It was explained its immediate priority was to continue operating at the remaining 64 restaurants and off-premise points and to help employees through the restructure.
But with large sums going into operating its locations, it likely can't afford to invest too much in its off-premise division because the market is “complex and using existing external services comes at a price”, commentators say.
However, it's noted, reducing expenses by withdrawing from crowded locations could be a effective strategy to evolve.