How the Country Lost Its Craving for Pizza Hut
Once, the popular pizza chain was the top choice for parents and children to enjoy its eat-as-much-as-you-like offering, unlimited salad bar, and ice cream with toppings.
However fewer patrons are visiting the brand these days, and it is shutting down half of its British restaurants after being rescued from insolvency for the second time this calendar year.
“We used to go Pizza Hut when I was a child,” explains one London shopper. “It was like a family thing, you'd go on a Sunday – turn it into an event.” However, at present, aged 24, she comments “it's fallen out of favor.”
For 23-year-old Martina, the very elements Pizza Hut has been famous for since it opened in the UK in the seventies are now less appealing.
“The manner in which they do their all-you-can-eat and their salad station, it seems as if they are lowering standards and have inferior offerings... They provide so much food and you're like ‘How is that possible?’”
Since ingredient expenses have soared, Pizza Hut's unlimited dining format has become increasingly pricey to operate. As have its restaurants, which are being cut from over 130 to just over 60.
The chain, like many others, has also experienced its expenses increase. In April this year, labor expenses jumped due to rises in minimum wages and an increase in employer social security payments.
Chris, 36, and Joanne, 29 say they would often visit at Pizza Hut for a date “every now and then”, but now they get delivery from Domino's and think Pizza Hut is “too expensive”.
According to your choices, Pizza Hut and Domino's costs are close, explains a culinary author.
Even though Pizza Hut has takeaway and deliveries through external services, it is missing out to major competitors which focus exclusively to this market.
“The rival chain has managed to dominate the delivery market thanks to aggressive marketing and frequent offers that make customers feel like they're getting a bargain, when in reality the original prices are on the higher side,” explains the expert.
But for Chris and Joanne it is acceptable to get their special meal sent directly.
“We predominantly have meals at home now instead of we eat out,” comments one of the diners, echoing current figures that show a decrease in people going to informal dining spots.
During the summer months, quick-service eateries saw a notable decrease in diners compared to the year before.
Additionally, one more competitor to restaurant and takeaway pizzas: the supermarket pizza.
An industry leader, global lead for leisure at a major consultancy, points out that not only have supermarkets been selling good-standard ready-to-bake pizzas for a long time – some are even promoting pizza-making appliances.
“Shifts in habits are also playing a factor in the performance of fast-food chains,” comments the expert.
The growing trend of protein-rich eating plans has increased sales at poultry outlets, while hitting sales of dough-based meals, he adds.
As people go out to eat not as often, they may prefer a more high-quality meal, and Pizza Hut's retro theme with comfortable booths and red and white checked plastic table cloths can feel more retro than upmarket.
The rise of artisanal pizza places” over the last several years, including boutique chains, has “fundamentally changed the general opinion of what quality pizza is,” explains the food expert.
“A light, fresh, easy-to-digest product with a select ingredients, not the massively greasy, heavy and overloaded pizzas of the past. That, arguably, is what's caused Pizza Hut's struggles,” she comments.
“Why would anyone spend a high price on a tiny, mediocre, unsatisfying pizza from a chain when you can get a stunning, expertly crafted traditional pie for under a tenner at one of the many traditional pizzerias around the country?
“The decision is simple.”
A mobile pizza vendor, who operates Smokey Deez based in a regional area explains: “It's not that fallen out of love with pizza – they just want improved value.”
Dan says his flexible operation can offer high-quality pie at accessible prices, and that Pizza Hut struggled because it failed to adapt with changing preferences.
At a small pizza brand in a UK location, owner Jack Lander says the pizza market is expanding but Pizza Hut has not provided anything innovative.
“You now have slice concepts, London pizza, thin crust, sourdough, traditional Italian, deep-dish – it's a heavenly minefield for a pizza enthusiast to try.”
The owner says Pizza Hut “needs to reinvent itself” as the youth don't have any fond memories or allegiance to the chain.
Over time, Pizza Hut's market has been fragmented and spread to its more modern, agile rivals. To maintain its high labor and location costs, it would have to increase costs – which experts say is challenging at a time when family finances are tightening.
A senior executive of Pizza Hut's overseas branches said the rescue aimed “to safeguard our dining experience and retain staff where possible”.
It was explained its first focus was to maintain service at the remaining 64 restaurants and takeaway hubs and to support colleagues through the transition.
Yet with so much money going into maintaining its outlets, it likely can't afford to allocate significant resources in its off-premise division because the industry is “complicated and partnering with existing delivery apps comes at a expense”, analysts say.
However, it's noted, cutting its costs by exiting crowded locations could be a good way to adapt.