Why the Nation Lost Interest in Its Craving for Pizza Hut
Once, the popular pizza chain was the favorite for families and friends to indulge in its unlimited dining experience, endless salad selection, and ice cream with toppings.
However not as many diners are choosing the chain nowadays, and it is shutting down half of its UK locations after being acquired following financial trouble for the second occasion this year.
“We used to go Pizza Hut when I was a child,” explains Prudence. “It was like a family thing, you'd go on a Sunday – spend the whole day there.” However, at present, in her mid-twenties, she comments “it's not a thing anymore.”
For a diner in her twenties, certain features Pizza Hut has been known and loved for since it started in the UK in the mid-20th century are now outdated.
“The way they do their all-you-can-eat and their salad bar, it feels like they are lowering standards and have reduced quality... They provide so much food and you're like ‘How can they?’”
Because 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 132 to 64.
The chain, like many others, has also experienced its expenses go up. This spring, labor expenses rose due to rises in minimum wages and an higher rate of employer social security payments.
Chris, 36, and Joanne, 29 mention they would often visit at Pizza Hut for a date “from time to time”, but now they get delivery from another pizza brand and think Pizza Hut is “too expensive”.
Depending on your order, Pizza Hut and Domino's costs are similar, says an industry analyst.
Although Pizza Hut provides off-premise options through delivery platforms, it is falling behind to big rivals which specialize to the delivery sector.
“Domino's has succeeded in leading the off-premise pizza industry thanks to strong promotions and ongoing discounts that make shoppers feel like they're saving money, when in reality the standard rates are quite high,” explains the analyst.
Yet for Chris and Joanne it is acceptable to get their evening together delivered to their door.
“We definitely eat at home now more than we eat out,” comments the female customer, reflecting recent statistics that show a decline in people visiting informal dining spots.
In the warmer season, quick-service eateries saw a notable decrease in diners compared to last summer.
Moreover, one more competitor to pizza from eateries: the frozen or fresh pizza.
An industry leader, global lead for leisure at a major consultancy, points out that not only have supermarkets been providing premium oven-ready pizzas for years – some are even offering pizza-making appliances.
“Evolving preferences are also playing a factor in the success of fast-food chains,” says the analyst.
The rising popularity of high protein diets has increased sales at grilled chicken brands, while affecting sales of carb-heavy pizza, 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 comfortable booths and red and white checked plastic table cloths can feel more retro than luxurious.
The “explosion of high-quality pizzerias” over the last 10 to 15 years, such as boutique chains, has “fundamentally changed the public's perception of what excellent pie is,” says the industry commentator.
“A crisp, airy, digestible pizza with a carefully curated additions, not the overly oily, dense and piled-high pizzas of the past. This, in my view, is what's resulted in Pizza Hut's decline,” she states.
“Who would choose to spend £17.99 on a modest, low-quality, underwhelming pizza from a chain when you can get a gorgeous, skillfully prepared traditional pie for under a tenner at one of the many authentic Italian pizzerias around the country?
“It's an easy choice.”
A mobile pizza vendor, who operates a pizza van based in a regional area comments: “The issue isn’t that stopped liking pizza – they just want better pizza for their money.”
He says his flexible operation can offer high-quality pie at accessible prices, and that Pizza Hut had difficulty because it failed to adapt with new customer habits.
From the perspective of an independent chain in a UK location, the founder says the pizza market is broadening but Pizza Hut has not provided anything fresh.
“There are now by-the-slice options, artisanal styles, New Haven-style, artisan base, wood-fired, Detroit – it's a delightful challenge for a pie fan to explore.”
Jack says Pizza Hut “should transform” as younger people don't have any sense of nostalgia or loyalty to the brand.
Over time, Pizza Hut's share has been sliced up and allocated to its more modern, agile competitors. To maintain its costly operations, it would have to raise prices – which commentators say is difficult at a time when personal spending are tightening.
The managing director of Pizza Hut's overseas branches said the rescue aimed “to safeguard our customer service and protect jobs where possible”.
The executive stated its first focus was to keep running at the surviving locations and delivery sites and to assist staff through the restructure.
However with large sums going into running its restaurants, it may be unable to invest too much in its delivery service because the sector is “complicated and working with existing third-party platforms comes at a price”, experts say.
Still, experts suggest, cutting its costs by withdrawing from crowded locations could be a smart move to adjust.