Why the Nation Lost Interest in Its Taste for the Pizza Hut Chain
In the past, the popular pizza chain was the top choice for groups and loved ones to feast on its all-you-can-eat buffet, endless salad selection, and self-serve ice-cream.
But fewer patrons are visiting the chain nowadays, and it is closing 50% of its UK restaurants after being bought out of administration for the second time this year.
It was common to visit Pizza Hut when I was a child,” notes Prudence. “It was a tradition, you'd go on a Sunday – spend the whole day there.” However, at present, aged 24, she comments “it's fallen out of favor.”
In the view of young customer Martina, the very elements Pizza Hut has been famous for since it started in the UK in the mid-20th century are now less appealing.
“The manner in which they do their buffet and their salad bar, it appears that they are cutting corners and have reduced quality... They provide so much food and you're like ‘How?’”
Since food prices have soared, Pizza Hut's unlimited dining format has become very expensive to run. The same goes for its locations, which are being reduced from over 130 to a smaller figure.
The company, like many others, has also faced its operating costs rise. In April this year, employee wages jumped due to rises in minimum wages and an increase in employer social security payments.
Chris, 36, and Joanne, 29 explain they frequently dined at Pizza Hut for a date “from time to time”, but now they choose another pizza brand and think Pizza Hut is “too expensive”.
Based on your selection, Pizza Hut and Domino's costs are comparable, notes an industry analyst.
While Pizza Hut provides off-premise options through third-party apps, it is losing out to big rivals which solely cater to off-premise dining.
“The rival chain has taken over the off-premise pizza industry thanks to strong promotions and ongoing discounts that make consumers feel like they're getting a bargain, when in reality the standard rates are relatively expensive,” explains the specialist.
But for these customers it is acceptable to get their special meal brought to their home.
“We absolutely dine at home now rather than we eat out,” says Joanne, matching current figures that show a decline in people frequenting quick-service eateries.
In the warmer season, casual and fast-food restaurants saw a six percent decline in patrons compared to last summer.
Moreover, a further alternative to restaurant and takeaway pizzas: the supermarket pizza.
Will Hawkley, global lead for leisure at a leading firm, explains that not only have supermarkets been offering premium ready-to-bake pizzas for a long time – some are even offering countertop ovens.
“Shifts in habits are also having an impact in the performance of quick-service brands,” comments Mr. Hawkley.
The increased interest of high protein diets has increased sales at chicken shops, while reducing sales of dough-based meals, he adds.
Because people dine out not as often, they may prefer a more upscale outing, and Pizza Hut's retro theme with comfortable booths and traditional décor can feel more dated than premium.
The “explosion of high-quality pizzerias” over the last several years, for example new entrants, has “fundamentally changed the general opinion of what quality pizza is,” says the industry commentator.
“A thin, flavorful, gentle crust with a select ingredients, not the overly oily, dense and piled-high pizzas of the past. That, I think, is what's led to Pizza Hut's decline,” she says.
“Who would choose to spend £17.99 on a small, substandard, disappointing pizza from a franchise when you can get a gorgeous, skillfully prepared Margherita for less than ten pounds at one of the many traditional pizzerias around the country?
“It's a no-brainer.”
A mobile pizza vendor, who runs Smokey Deez based in a regional area comments: “It's not that fallen out of love with pizza – they just want higher quality at a fair price.”
Dan says his mobile setup can offer premium pizza at affordable costs, and that Pizza Hut struggled because it failed to adapt with evolving tastes.
According to a small pizza brand in a UK location, the proprietor says the industry is diversifying but Pizza Hut has not provided anything innovative.
“You now have individual slices, regional varieties, new haven, fermented dough, Neapolitan, rectangular – it's a wonderful array for a pizza enthusiast to explore.”
He says Pizza Hut “must rebrand” as newer generations don't have any sense of nostalgia or loyalty to the brand.
In recent years, Pizza Hut's market has been sliced up and spread to its more modern, agile competitors. To sustain its high labor and location costs, it would have to increase costs – which commentators say is difficult at a time when family finances are tightening.
A senior executive of Pizza Hut's overseas branches said the acquisition aimed “to protect our guest experience and retain staff where possible”.
The executive stated its immediate priority was to continue operating at the remaining 64 restaurants and off-premise points and to assist staff through the restructure.
However with significant funds going into running its restaurants, it likely can't afford to invest too much in its off-premise division because the sector is “complicated and partnering with existing delivery apps comes at a price”, analysts say.
But, he adds, reducing expenses by exiting crowded locations could be a smart move to adjust.