What We Can Take from What the Famous Chain Did
Pizza chains don’t just become successful overnight. It takes time, hard work, and you guessed it – good marketing to get to where they want to be. That being said, we’re taking a moment to highlight the history, failures, and successes of one well-known chain in particular…Pizza Hut: the world’s leading company in the fast-food segment, and perhaps the single most successful pizza producer to date. Read on to learn how this restaurant chain got to be one of America’s most famous pizza brands.
The History of the Hut
Back in 1958, two brothers came together (after borrowing a, then-expensive, $600 from their mother) and opened what would eventually be called Pizza Hut, in Wichita, Kansas, along with partner John Bender. They started off with a great marketing tactic – free goods – giving away pizza on night one to entice customers. Just six months later, they opened a second store, and a year later, they owned six restaurants, which led them to begin franchising. Throughout the early 1960s, Pizza Hut’s name started to become known with their use of hard-hitting marketing. The famous building style didn’t actually come to life until 1969. And the famous name? Simply chosen because their sign could only fit eight letters. Who would have thought?
Pizza Hut merged with PepsiCo in 1977 – helping sales to increase to $436 million, and facilitating the opening of a $10 million headquarters in Wichita.
Failures Lead to Success
In 1994, several changes resulted in a decline in profits. These changes included a halt in pizza market growth, competition price decreases, and an increase in stores – leading to fewer corporate resources. Overall, profits dropped by 21%, so, it wasn’t the best time for the hut (to say the least). Pizza Hut was also affected by the rise of dine-in versus delivery. According to Restaurant Business, only about 10% of Pizza Hut’s sales were coming from dine-in at the time, so they needed to focus more on what people wanted and needed – takeout and delivery. To fix this issue, many dine-in focused locations closed, and express locations began to pop up.
Additionally, Pizza Hut started using a combination of creative marketing outreach, innovative technology, and revitalized menus and recipes. With these changes, sales increased by 3% in 2020. Pizza Hut continues to invest in innovative technologies to ensure they keep growing and evolving. They’ve even launched an omnichannel menu management system that helps their efficiency and unifies their stores.
“We do think there’s an important role for innovation to play…So, we’re confident in the brand coming to life. As we’ve always talked about, the challenges are more around the asset base than it is the consumers’ love for the brand or the products that we serve.” -CEO David Gibbs
Today, around 2 million pizzas are served by Pizza Hut each day from more than 12,000 locations, with 4 million customers (and growing) around the world.
Pizza Hut has never been afraid to try their hand at new and innovative marketing practices. Their first TV commercial in 1965 was called “Putt Putt to the Pizza Hut”. And they’ve had several slogans since then, such as “Makin’ it great!” from 1987-1995, “You’ll love the stuff we’re made of” from 1995 to 1999, “Gather ‘round the good stuff” until 2007, “Now You’re Eating!” from 2008 to 2009, “Your Favorites. Your Pizza Hut” from 2009 to 2012, and “Make it great” (a twist on their 1987 slogan) from 2012 to 2016. As for today’s slogan? You’ll most likely recognize it, “No one out pizzas the hut”.
Pizza Hut has also used advertising to their advantage, in everything from TV to film. They even sponsored the movie Back to the Future Part II in 1989, offering free futuristic sunglasses with every pizza purchase. Additionally, they used product placement, including a space-age version of their logo in a few of the movie’s scenes.
Another marketing tactic highly used by the “Hut”? Sponsorships. In 2005, Pizza Hut purchased rights to name the Major League Soccer club FC Dallas’ Stadium Pizza Hut Park. And in 2015, they signed sponsorship deals with several big-time names, including the Dallas Stars, Dallas Mavericks, and American Airlines. In 2018, Pizza Hut even became the official pizza sponsor for NFL, and is also currently the official sponsor for the NCAA.
With just $600, 3 pizza entrepreneurs became one of the biggest pizza chains in history. So, what can we learn from Pizza Hut? Always explore, change, and expand on your marketing and technology practices – because you never know what may work and make you the next big name everyone’s talking about.
If your marketing could use a little revamp and you’d like to try some innovative marketing technology, feel free to reach out to our marketing specialists here at ZaHub!