How the Country Lost Its Craving for Pizza Hut
Once, the popular pizza chain was the go-to for groups and loved ones to indulge in its unlimited dining experience, unlimited salad bar, and self-serve ice-cream.
Yet not as many customers are choosing the chain currently, and it is shutting down a significant portion of its British outlets after being rescued from insolvency for the second instance this year.
It was common to visit Pizza Hut when I was a child,” notes one London shopper. “It was a regular outing, you'd go on a Sunday – turn it into an event.” However, at present, in her mid-twenties, she comments “it's fallen out of favor.”
According to 23-year-old Martina, some of the very things Pizza Hut has been known and loved for since it started in the UK in the 1970s are now not-so-hot.
“The way they do their buffet and their salad bar, it feels like they are cheapening on their quality and have lower standards... They're giving away so much food and you're like ‘How is that possible?’”
Since food prices have risen sharply, Pizza Hut's all-you-can-eat model has become very expensive to maintain. The same goes for its restaurants, which are being cut from over 130 to just over 60.
The chain, like many others, has also faced its expenses increase. Earlier this year, employee wages jumped due to increases in the legal wage floor and an rise in employer national insurance contributions.
A couple in their thirties and twenties mention they would often visit at Pizza Hut for a date “occasionally”, but now they get delivery from Domino's and think Pizza Hut is “too expensive”.
Depending on your selection, Pizza Hut and Domino's costs are comparable, explains a food expert.
Even though Pizza Hut provides takeaway and deliveries through third-party apps, it is missing out to larger chains which solely cater to this market.
“The rival chain has succeeded in leading the off-premise pizza industry thanks to aggressive marketing and ongoing discounts that make customers feel like they're finding a good deal, when in reality the base costs are on the higher side,” says the analyst.
Yet for Chris and Joanne it is justified to get their special meal sent directly.
“We absolutely dine at home now more than we eat out,” comments one of the diners, matching current figures that show a decline in people going to informal dining spots.
During the summer months, informal dining venues saw a 6% drop in customers compared to the previous year.
There is also another rival to pizza from eateries: the supermarket pizza.
An industry leader, head of leisure and hospitality at a major consultancy, notes that not only have retailers been selling premium oven-ready pizzas for quite a while – some are even selling pizza-making appliances.
“Lifestyle changes are also contributing in the performance of casual eateries,” says Mr. Hawkley.
The increased interest of high protein diets has boosted sales at chicken shops, while reducing sales of high-carbohydrate options, he continues.
Since people go out to eat more rarely, they may seek out a more high-quality meal, and Pizza Hut's retro theme with booth seating and nostalgic table settings can feel more retro than premium.
The rise of premium pizza outlets” over the last several years, for example boutique chains, has “dramatically shifted the general opinion of what excellent pie is,” notes the food expert.
“A thin, flavorful, gentle crust with a select ingredients, not the excessively rich, thick and crowded pizzas of the past. This, in my view, is what's caused Pizza Hut's downfall,” she comments.
“Who would choose to spend £17.99 on a tiny, mediocre, unsatisfying pizza from a large brand when you can get a beautiful, masterfully-made traditional pie for less than ten pounds at one of the many authentic Italian pizzerias around the country?
“The decision is simple.”
Dan Puddle, who owns a pizza van based in a regional area comments: “The issue isn’t that stopped liking pizza – they just want higher quality at a fair price.”
The owner says his mobile setup can offer high-quality pie at reasonable rates, and that Pizza Hut faced challenges because it failed to adapt with new customer habits.
From the perspective of an independent chain in a city in southwest England, the founder says the industry is expanding but Pizza Hut has failed to offer anything new.
“There are now individual slices, artisanal styles, thin crust, artisan base, traditional Italian, rectangular – it's a heavenly minefield for a pizza enthusiast to explore.”
He says Pizza Hut “needs to reinvent itself” as the youth don't have any fond memories or loyalty to the brand.
In recent years, Pizza Hut's market has been sliced up and allocated to its fresher, faster competitors. To keep up its costly operations, it would have to raise prices – which industry analysts say is challenging at a time when household budgets are tightening.
The managing director of Pizza Hut's international markets said the rescue aimed “to ensure our dining experience and retain staff where possible”.
He said its immediate priority was to maintain service at the open outlets and off-premise points and to support colleagues through the restructure.
Yet with large sums going into operating its locations, it likely can't afford to invest too much in its takeaway operation because the sector is “complicated and working with existing third-party platforms comes at a expense”, commentators say.
But, he adds, lowering overhead by exiting oversaturated towns and city centres could be a good way to evolve.