How the Nation Turned Away from Its Taste for Pizza Hut
In the past, the popular pizza chain was the favorite for parents and children to feast on its eat-as-much-as-you-like offering, help-yourself greens station, and self-serve ice-cream.
Yet a declining number of patrons are visiting the restaurant these days, and it is reducing half of its UK outlets after being rescued from insolvency for the second time this year.
“We used to go Pizza Hut when I was a child,” notes a young adult. “It was a tradition, you'd go on a Sunday – turn it into an event.” But now, aged 24, she comments “it's fallen out of favor.”
In the view of a diner in her twenties, the very elements Pizza Hut has been famous for since it started in the UK in the mid-20th century are now less appealing.
“The manner in which they do their buffet and their salad bar, it seems as if they are lowering standards and have inferior offerings... They offer so much food and you're like ‘How?’”
Since food prices have increased significantly, Pizza Hut's unlimited dining format has become very expensive to run. Similarly, its outlets, which are being reduced from over 130 to a smaller figure.
The company, similar to other firms, has also experienced its operating costs go up. Earlier this year, labor expenses rose due to increases in the legal wage floor and an rise in employer social security payments.
Two diners mention they used to go at Pizza Hut for a date “occasionally”, but now they order in a rival chain and think Pizza Hut is “not good value”.
Depending on your selection, Pizza Hut and Domino's costs are similar, explains a food expert.
Although Pizza Hut provides takeaway and deliveries through delivery platforms, it is losing out to larger chains which focus exclusively to this market.
“Domino's has succeeded in leading the delivery market thanks to intensive advertising and constantly running deals that make shoppers feel like they're getting a bargain, when in reality the standard rates are quite high,” explains the expert.
However for Chris and Joanne it is worth it to get their evening together sent directly.
“We absolutely dine at home now instead of we eat out,” says one of the diners, echoing latest data that show a decline in people frequenting quick-service eateries.
Over the summer, casual and fast-food restaurants saw a 6% drop in patrons compared to the year before.
Moreover, a further alternative to ordered-in pies: the cook-at-home oven pizza.
A hospitality expert, senior partner at a major consultancy, points out that not only have grocery stores been selling good-standard oven-ready pizzas for years – some are even offering home-pizza ovens.
“Evolving preferences are also playing a factor in the success of casual eateries,” comments Mr. Hawkley.
The growing trend of low-carb regimens has boosted sales at chicken shops, while reducing sales of dough-based meals, he notes.
Because people go out to eat not as often, they may seek out a more upscale outing, and Pizza Hut's American-diner style with booth seating and nostalgic table settings can feel more retro than luxurious.
The rise of premium pizza outlets” over the last decade and a half, including boutique chains, has “fundamentally changed the consumer view of what excellent pie is,” says the food expert.
“A thin, flavorful, gentle crust with a select ingredients, not the excessively rich, thick and crowded pizzas of the past. That, arguably, is what's led to Pizza Hut's downfall,” she comments.
“What person would spend £17.99 on a small, substandard, disappointing pizza from a large brand when you can get a beautiful, masterfully-made Margherita for a lower price at one of the many real Italian restaurants around the country?
“It's an easy choice.”
An independent operator, who runs a small business based in a regional area says: “The issue isn’t that stopped liking pizza – they just want improved value.”
He says his adaptable business can offer high-quality pie at accessible prices, and that Pizza Hut struggled because it could not keep up with new customer habits.
From the perspective of a small pizza brand in a city in southwest England, owner Jack Lander says the sector is broadening but Pizza Hut has failed to offer anything new.
“There are now individual slices, London pizza, new haven, artisan base, wood-fired, deep-dish – it's a wonderful array for a pizza-loving consumer to try.”
The owner says Pizza Hut “should transform” as newer generations don't have any emotional connection or allegiance to the brand.
Gradually, Pizza Hut's market has been divided and spread to its trendier, more nimble competitors. To keep up its costly operations, it would have to increase costs – which industry analysts say is difficult at a time when family finances are tightening.
A senior executive of Pizza Hut's international markets said the acquisition aimed “to safeguard our customer service and protect jobs where possible”.
He said its key goal was to keep running at the remaining 64 restaurants and off-premise points and to help employees through the transition.
But with large sums going into running its restaurants, it probably cannot to invest too much in its off-premise division because the industry is “complicated and partnering with existing delivery apps comes at a cost”, analysts say.
But, he adds, lowering overhead by withdrawing from crowded locations could be a effective strategy to adjust.