The Decline of Pizza Hut...What Happened?

[Music] Pizza Hut is what I would consider an iconic American brand thinking back they're kind of like the perfect family restaurant honestly how many of you watching this have these great memories of eating there with your family maybe you had your birthday party there or maybe you participated in their book it reading program where you earned one of those colorful pins or my favorite a personal pan pizza it would sure take a lot to get that pizza but it was on another level I'm sure that many of us have similar memories involving Pizza Hut which

is why it's upsetting to see them like this now to be clear I'm not saying that they're in any immediate danger of shutting down Pizza Hut is still pretty stable and I'm guessing that they're going to be with us for quite a while but I do have strong evidence to suggest that Pizza Hut has seen better days in 2019 they announced that they would be closing 500 of their 7500 Us locations over the next 2 years it's part of their long-term plan that involves closing underperforming restaurants and replacing them I'll touch more on it later

but for the time being that is a significant downsizing in fact the presidents of the company along with other top Executives have expressed that they haven't been happy with Pizza Hut's overall performance looking at their sales over the past few years they have actually been fairly consistent which may not seem like much of an issue but it is concerning see when we compare that to Dominoes I think we start to see the problem when they say that no one out pizzas the Huts I don't exactly know what that means but it might not be true

true anymore in the 1970s and even well into the 1980s anyone who was around at the time can tell you that Pizza Hut used to be the national Pizza chain they were a national Pizza chain before there were National pizza chains people had to make the choice of either going to the local Regional place or to Pizza Hut any other popular chain that you can think of today it was not a factor on a national scale until at least the 1980s then over those next few decades things got more competitive some of those smaller chains

started closing the Gap but Pizza Hut still remained on top that is until 2018 as we saw in the graph Domino's took over that number one spot and over the next few years have only extended that lead that's meaningful after 47 years the world's number one pizza chain Pizza Hut has fallen to second place and a distant second at that in that same year 2018 I actually asked the audience of this channel what is your favorite of the big four pizza chains and after 46,000 votes Domino's was the clear winner over the second place Pizza

Hut I believe further suggesting that people have moved away from them more evidence would be the fact that their biggest franchiser NPC international filed for bankruptcy in July of 2020 they were the ones who operated about 20% of the US Pizza Hut locations of course there were some other factors involved in that one but it's not a good indicator of the state of the Brand Plus it later led to an additional 300 restaurant closings and then finally what about the logo change through most of their dominant years throughout the 7s ' 80s and '90s this

was their logo then in 1999 they changed it they added more colors and slanted everything but then 20 years later in 2019 they went back to that old logo according to their Chief brand officer at the time embracing our iconic Pizza Hut logo is recognition of a time period where Pizza Hut unequivocally Reigns Supreme because that's where the future is headed I take that to mean that the old logo represents a better time for Pizza Hut and that bringing it back will remind the customers of those better times I hope that we can at least

agree that Pizza Hut has indeed seen better times they've lost a lot of control of their market and in this video I'm going to attempt to explain why the very first Pizza Hut opened in Witchita Kansas in 1958 and it could not have been more modest in the beginning it was two brothers named Frank and Dan Carney they borrowed $600 from their mom and used it to buy used equipment and rent out a small building not too far from a university I thought it was interesting that they called their first restaurant Pizza Huts mostly because

they obtained the sign that had only enough room for so many letters and you know of course they wanted to use the word pizza so that meant that their second word can only be three letters they eventually settled on the word Hut and that was the beginning of the brand if they had a bigger sign things may have gone much differently early on they valued Quality Pizza good service and believed in it so much that on their opening night they gave away their pizzas to try to attract a customer base it was an effective promotion

the restaurant did well and after about a year they were able to convince a friend of theirs to operate the first franchise Loc location in Topeka Kansas it's also worth mentioning that part of their marketing early on involved this I guess stereotypical mascot named Pizza Pete I believe that it was meant to double as a fun cartoon for the kids while promoting the Italian authenticity of their food pizza itself wasn't nearly as welln or popular at the time so something like that was effective in drawing in customers and creating a fun environment they adopted that

Red Roof logos started designing their restaurants in the same manner and continued franchising more and more locations across the United States and even into other countries like Canada and Germany and by 1971 Pizza Hut at over 1,000 locations making them the biggest chain of pizza restaurants in the world 6 years later when they had more than doubled to over 2,000 locations they were bought by Pepsi Co and it was Pepsi that was able to take them to an even higher level surpassing 5,000 locations in less than a decade after the acquisition and surpassing 7500 locations

when they spun it off along with the rest of the restaurant division into its own company that was owned by the public if you want more details about their time with Pepsi and what was happening with all of that I do recommend this other video that I made about Pepsi but that new company that it was now a part of was initially called Trion Global restaurants but soon renamed to Yum brands which is how they exist today right now it consists mainly of KFC Pizza Hut in Taco Bell though some people have expressed the opinion

that Pizza Hut has been the one holding them back and should be divested now when looking at the reasons behind the trouble happening at Pizza Huts I think most of it can be explained by two main issues the first one being a lack of catchy menu items and I realize that this might sound so trivial when you first hear it but let me explain today seemingly every fast food restaurant has a never-ending sequence of new items that are pumpkin flavored or Cheeto flavored or whatever but Pizza Hut was somewhat of a Pioneer at this to

a point where I would even say that these catchy Innovative menu items were once a major part of their success a couple of examples of what I would consider to be more gimmicky ones would be the edge with toppings way closer to the edge of the Pizza than they should be or the big New Yorker both introduced in the late 1990s they sold pretty well and kept people coming back to Pizza Hut but then there's other examples of new menu items that they introduced that I would truly call Innovative some examples there would be in

1980 when they came out with the pan pizza or in 1995 when they came out with the stuffed crust pizza famously promoted by Donald Trump there are countless examples to show how Pizza Hut once had one of the most creative menus out there which unfortunately may not be the case anymore in late 2014 you may be surprised to hear this but Pizza Hut announced an allnew menu they called it flavor of now and described it as their biggest brand Evolution ever I mean this was meant to be a big deal they had new ingredients new

sauces new crust flavors new drizzles just a bold attempt to completely revamp their entire menu to make it appear fresh and more upper scale and to go along with that new menu they updated their website the boxes the uniforms the logo I think that the goal of this was to shift their customer base away from families and more specifically toward Millennials I'm going to go ahead and guess that most of you barely remember this happening or maybe not at all because the whole flavor of now attempt was pretty much a failure as we've already seen

it did nothing at all to help their sales if anything they actually went down a tiny bit the following year the CEO of yum brands confirmed that the results were disappointing and as far as I could tell it's mostly been abandoned if anything it probably just alienated their existing customers more than anything else overall this suggests to me that Pizza Hut is not quite what they used to be in introducing new menu items that appeal to their customers I'm just saying that the Bigfoot pizza was a little more successful than the cocka doodle bacon that's

a weird sentence the second part of their troubles I believe it can be attributed to being slow to delivery and I don't mean taking over 30 minutes to deliver a pizza so then it's too cold I mean taking too long to make pizza delivery in general a major part of their business here's what I mean historically Pizza is like the most common thing to have delivered right I mean now more than ever but it's been happening for a while before 2020 before online shopping before any of it people were having pizzas delivered however Pizza Hut

was once famous for their familyfriendly sitdown restaurants in the beginning of this video when you were thinking back to those memories of birthday parties and personal pan pizzas which is another Pizza Hut Innovation by the way they took place inside of a Pizza Hut not at home eating pizza delivered by Pizza Huts it was like an event it was an outing it was not just about the food in fact they didn't even offer pizza delivery at a large scale until 1986 and the only reason they did it then was because dominoes had been so successful

with it you might even say that Pizza Hut's lack of delivery during those times is a big reason that Domino's was even able to get their foot in the door in the first place I do have to say that after a late start they have been aggressive with it but I think the issue is that it's such a fundamental change as far as the Public's perception they've had all of these crazy marketing attempts to try to make people associate Pizza Hut with delivery in 1989 they famously delivered Pizza to the White House in 2001 they

delivered it into outer space in 2016 they delivered it onto Mount kilamanjaro when they closed those 500 locations the reason for it was to eliminate the dining area and to reopen them as smaller buildings their fastest growing store models are the smaller ones that they call Delco short for delivery and carry out and part of their reasoning is that if every time you see a Pizza Hut it's a little tiny building you're going to reconfigure your mind and Associate them with delivery so to summarize all of this a Pizza Hut is a very different place

than it used to be they've been around for long enough to have the world change around them parts of what made them popular before are no longer relevant and they've been forced to adapt to those changes whereas some of their competitors like Domino's or Little Caesars first grew in that new environment if that makes any sense it's kind of like Pizza Hut is the older generation struggling to fit in with the new one some of their attempts to do it do seem to be a little slower potentially misguided but they are attempts they know where

they need to go go they just don't know exactly how to get there which gives me confidence that they will eventually make progress in the right direction let me know in the comments what do you think about Pizza Huts how have they changed over the years and how is your perception of them changed do you even like their pizzas or do you prefer one of their competitors I do want to Reas that poll from 2018 to see if we get different results so be sure to check the community tab of this channel if you want

to weigh in on it or check the results that should be fun and any other thoughts you have about Pizza Hut or any other part of the pizza industry leave them in the comments I'd like to hear what you have to say thank you for watching [Music]