Why the Nation Lost Its Taste for Pizza Hut
In the past, Pizza Hut was the favorite for groups and loved ones to enjoy its all-you-can-eat buffet, endless salad selection, and make-your-own dessert.
Yet fewer diners are frequenting the restaurant nowadays, and it is closing 50% of its UK locations after being bought out of administration for the second time this calendar year.
I remember going Pizza Hut when I was a child,” says a young adult. “It was a regular outing, you'd go on a Sunday – turn it into an event.” But now, in her mid-twenties, she says “it's no longer popular.”
In the view of a diner in her twenties, the very elements Pizza Hut has been known and loved for since it started in the UK in the 1970s are now less appealing.
“The manner in which they do their all-you-can-eat and their salad station, it feels like they are lowering standards and have lower standards... They're giving away so much food and you're like ‘How?’”
As food prices have risen sharply, Pizza Hut's all-you-can-eat model has become quite costly to run. As have its outlets, which are being reduced from a large number to just over 60.
The company, in common with competitors, has also experienced its operating costs rise. In April this year, staffing costs increased due to increases in the legal wage floor and an increase in employer taxes.
Chris, 36, and Joanne, 29 say they frequently dined at Pizza Hut for a date “from time to time”, but now they order in another pizza brand and think Pizza Hut is “too expensive”.
Depending on your selection, Pizza Hut and Domino's prices are close, explains a food expert.
While Pizza Hut does offer pickup and delivery through third-party apps, it is losing out to major competitors which specialize to off-premise dining.
“Another pizza company has taken over the delivery market thanks to aggressive marketing and ongoing discounts that make shoppers feel like they're finding a good deal, when in reality the original prices are relatively expensive,” notes the expert.
However for these customers it is justified to get their evening together delivered to their door.
“We absolutely dine at home now instead of we eat out,” comments Joanne, echoing current figures that show a drop in people going to quick-service eateries.
During the summer months, informal dining venues saw a 6% drop in patrons compared to the previous year.
There is also a further alternative to pizza from eateries: the frozen or fresh pizza.
A hospitality expert, senior partner at a leading firm, explains that not only have retailers been providing good-standard prepared pies for quite a while – some are even promoting countertop ovens.
“Shifts in habits are also having an impact in the popularity of quick-service brands,” comments Mr. Hawkley.
The increased interest of high protein diets has driven sales at poultry outlets, while affecting sales of high-carbohydrate options, he adds.
As people go out to eat not as often, they may seek out a more upscale outing, and Pizza Hut's classic look with comfortable booths and red and white checked plastic table cloths can feel more old-fashioned than premium.
The growth of premium pizza outlets” over the last several years, for example new entrants, has “completely altered the consumer view of what excellent pie is,” notes the food expert.
“A light, fresh, easy-to-digest product with a select ingredients, not the excessively rich, thick and crowded pizzas of the past. That, arguably, is what's caused Pizza Hut's downfall,” she states.
“Who would choose to spend nearly eighteen pounds on a small, substandard, disappointing pizza from a franchise when you can get a beautiful, masterfully-made classic pizza for less than ten pounds at one of the many authentic Italian pizzerias around the country?
“The decision is simple.”
A mobile pizza vendor, who operates a small business based in a regional area comments: “People haven’t fallen out of love with pizza – they just want higher quality at a fair price.”
The owner says his flexible operation can offer gourmet pizza at affordable costs, and that Pizza Hut faced challenges because it was unable to evolve with new customer habits.
From the perspective of an independent chain in Bristol, the founder says the industry is diversifying but Pizza Hut has neglected to introduce anything fresh.
“There are now by-the-slice options, artisanal styles, New Haven-style, fermented dough, Neapolitan, deep-dish – it's a wonderful array for a pizza-loving consumer to discover.”
He says Pizza Hut “should transform” as newer generations don't have any emotional connection or loyalty to the company.
Over time, Pizza Hut's share has been sliced up and distributed to its fresher, faster alternatives. To maintain its costly operations, it would have to charge more – which industry analysts say is challenging at a time when personal spending are decreasing.
The managing director of Pizza Hut's international markets said the acquisition aimed “to safeguard our dining experience and save employment where possible”.
It was explained its first focus was to continue operating at the open outlets and off-premise points and to help employees through the restructure.
Yet with significant funds going into running its restaurants, it likely can't afford to invest too much in its delivery service because the market is “complex and partnering with existing delivery apps comes at a expense”, analysts say.
Still, experts suggest, lowering overhead by leaving competitive urban areas could be a smart move to evolve.