How Pizza Hut Got Its Groove Back
At the end of 2009, Pizza Hut was the most unappetizing brand in the portfolio of parent company YUM! Brands (YUM), with sales shrinking 12 percent. In the first quarter of 2010, the pizza chain turned that into 5 percent growth, while fellow YUM brands Taco Bell and KFC continued to see sales declines.
How'd they do that? A look at the initiatives that have helped Pizza Hut win back customers:
- New price: Pizza Hut rolled out a new offer at the beginning of this year, with the slogan "Any pizza, any size, any toppings, $10." The promotion put Pizza Hut's signature pies at a recession-conscious price that made it a no-brainer for customers craving a quick, easy dinner. The simplicity of the offer was probably a big plus for time-pressed parents. The campaign was so successful it may actually pave the way for the chain to raise prices again as the year rolls on.
- Aggressive promotion. You could hardly turn on a TV or walk down the street without seeing the "Any pizza $10" promotion. Pizza Hut wasn't afraid to spend big, featuring the campaign prominently in the Super Bowl pregame show.
- New products. Pizza Hut could have gone on making tasty pizzas forever, but it kept on innovating. It launched a line of a dozen baked pasta dishes in November that appeared to gain some traction this year. Three of the pastas are currently being promoted, a chicken alfredo, meaty marinara, and Tuscani meat lasagna.
- More choices. Lots of pizza places sell chicken on the side, but Pizza Hut has moved boldly into the category with eight different flavors of wings, from garlic parmesan to spicy Asian, some bone-in, others bone-out -- in other words, something for everyone. That's eight times as many chances a customer will get hooked on their particular sauce and need to come back again. They've also branded their wing offerings with the WingStreet tag, reinforcing the message that they have a lot in this category.