How the Nation Lost Its Taste for the Pizza Hut Chain
At one time, Pizza Hut was the top choice for groups and loved ones to indulge in its all-you-can-eat buffet, unlimited salad bar, and self-serve ice-cream.
But not as many customers are visiting the chain nowadays, and it is closing 50% of its UK outlets after being bought out of administration for the second time this year.
“We used to go Pizza Hut when I was a child,” says Prudence. “It was a tradition, you'd go on a Sunday – make a day of it.” Today, as a young adult, she says “it's fallen out of favor.”
According to young customer Martina, some of the very things Pizza Hut has been known and loved for since it started in the UK in the seventies are now less appealing.
“The way they do their all-you-can-eat and their salad station, it appears that they are cheapening on their quality and have lower standards... They provide so much food and you're like ‘How?’”
Since food prices have risen sharply, Pizza Hut's unlimited dining format has become increasingly pricey to run. Similarly, its restaurants, which are being cut from over 130 to just over 60.
The company, like many others, has also seen its expenses go up. In April this year, labor expenses jumped due to rises in minimum wages and an higher rate of employer social security payments.
Two diners explain they frequently dined at Pizza Hut for a date “every now and then”, but now they choose Domino's and think Pizza Hut is “too expensive”.
Depending on your choices, Pizza Hut and Domino's prices are comparable, says a food expert.
Even though Pizza Hut has takeaway and deliveries through third-party apps, it is falling behind to big rivals which focus exclusively to this market.
“Domino's has succeeded in leading the delivery market thanks to aggressive marketing and constantly running deals that make shoppers feel like they're getting a bargain, when in reality the standard rates are quite high,” notes the expert.
But for these customers it is justified to get their evening together brought to their home.
“We definitely eat at home now instead of we eat out,” says the female customer, matching latest data that show a drop in people going to quick-service eateries.
Over the summer, casual and fast-food restaurants saw a notable decrease in customers compared to last summer.
There is also a further alternative to ordered-in pies: the cook-at-home oven pizza.
An industry leader, head of leisure and hospitality at a major consultancy, explains that not only have retailers been selling premium prepared pies for years – some are even selling countertop ovens.
“Shifts in habits are also playing a factor in the popularity of quick-service brands,” says Mr. Hawkley.
The rising popularity of protein-rich eating plans has increased sales at grilled chicken brands, while reducing sales of high-carbohydrate options, he continues.
Because people dine out not as often, they may seek out a more premium experience, and Pizza Hut's American-diner style with comfortable booths and traditional décor can feel more old-fashioned than premium.
The rise of high-quality pizzerias” over the last 10 to 15 years, for example boutique chains, has “completely altered the public's perception of what good pizza is,” notes the food expert.
“A crisp, airy, digestible pizza with a few choice toppings, not the massively greasy, heavy and overloaded pizzas of the past. That, I think, is what's caused Pizza Hut's downfall,” she states.
“Why would anyone spend £17.99 on a modest, low-quality, underwhelming pizza from a chain when you can get a gorgeous, skillfully prepared traditional pie for less than ten pounds at one of the many real Italian restaurants around the country?
“It's a no-brainer.”
Dan Puddle, who runs a pizza van based in a county in England comments: “People haven’t stopped liking pizza – they just want better pizza for their money.”
Dan says his adaptable business can offer high-quality pie at affordable costs, and that Pizza Hut had difficulty because it failed to adapt with evolving tastes.
From the perspective of Pizzarova in a UK location, the proprietor says the pizza market is broadening but Pizza Hut has neglected to introduce anything fresh.
“You now have slice concepts, regional varieties, thin crust, sourdough, Neapolitan, Detroit – it's a heavenly minefield for a pizza-loving consumer to explore.”
The owner says Pizza Hut “must rebrand” as the youth don't have any emotional connection or loyalty to the company.
In recent years, Pizza Hut's customer base has been fragmented and distributed to its fresher, faster alternatives. To maintain its high labor and location costs, it would have to charge more – which experts say is difficult at a time when personal spending are shrinking.
The managing director of Pizza Hut's global operations said the acquisition aimed “to ensure our dining experience and protect jobs where possible”.
He said its key goal was to maintain service at the remaining 64 restaurants and off-premise points and to support colleagues through the restructure.
But with large sums going into operating its locations, it may be unable to spend heavily in its off-premise division because the industry is “difficult and using existing delivery apps comes at a expense”, experts say.
Still, experts suggest, cutting its costs by withdrawing from competitive urban areas could be a effective strategy to adapt.