Report and Marketing Strategies of Pizza Hut

A PRESENTATION REPORT ON

PIZZA HUT PESHAWAR

ACCEP TED TO
SIR IMRAN WAZIR

ACC EPTE D BY :

ADNAN KHAN
MUJAHID HUSSAIN
NAVEED SAEED
SHAHZAD TAHIR
ZARTASHIA ARSHAD

BBA (HONS) - C
1st Semester

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 Report and Marketing Strategies of Pizza Hut

TABLE OF CONTENTS
S. No. Topic Page Number
1 Letter of acceptance 3
2 Executive summary 4
3 History of Pizza 5
4 Introduction & History Of Pizza 5
Hut
5 Pizza Hut Mission Statement 6
6 Comparative Strategy 7
7 PEST 8
8 SWOT 9
9 Segmentation 10
10 Positioning 10
11 Targeting 11
12 Pizza Hut Strategies 11
13 Functional Level Strategy 11
14 TQM (Total Quality 12
Management)
15 Business Level Strategy 12
16 Pricing Strategy 12
17 Market Share 13
18 Four P's of Marketing 14
19 ➢ Product 14
20 ➢ Price 14
21 ➢ Place 15
22 ➢ Promotion 16
23 Conclusion 17
24 References 18

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 Report and Marketing Strategies of Pizza Hut

LETTER OF ACCEPTANCE

To:

Mr. Imran Wazir,

Lecturer IM| Sciences,
Peshawar.

Subject: PREPARATION OF REPORT

We are Hereby Presenting the presentation on Company Pizza Hut and

assure you submission of our report in compliance with the instruction envisaged.
Name of topic is repeated for ready reference please.

“Marketing Plans & Business report on Pizza Hut”

Yours sincerely,

Adnan Khan
Mujahid Hussain
Naveed Saeed
Shahzad Tahir
Zartashia Arshad

Date: March 03, 2009

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 Report and Marketing Strategies of Pizza Hut

EXECUTIVE SUMMARY

During the past four decades Pizza Hut has built a reputation for excellence
that has earned the respect of consumers and industry experts alike.
Building a leading pizza company has required relentless innovation,
commitment to quality and dedication to customer service and value. The
qualities of entrepreneurship, growth and leadership have characterized
Pizza Hut’s business through more than four decades of success. Through
the strength of its heritage, its culture and its people and franchisees, Pizza
Hut looks forward to more success in future.
There are different objectives of every organization. In order to achieve
these objectives different targets are set. Targets pass down the hierarchy
depending on the nature of the business. Therefore, in order to achieve the
objectives, management decides on different strategies. These strategies
are divided into many sub-parts and are useful for the running of the
business. The employees and the management know what they have to
achieve through the targets which have been set to them and the strategies
they have adopted help them know the way they will achieve the objectives.
Similarly, Pizza Hut has different targets set to them and they have adopted
different strategies to successfully achieve the targets set. These targets are
set by the RSC i.e. the restaurant support centre in Karachi. These targets
are passed on to the RGM (restaurant general manager) and he passes them
to the workforce. These targets fall within the organizational structure in
which there are many people who have different targets to achieve. In order
to successfully achieve the targets they need to co-operate and work in a
friendly environment.

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HISTORY OF PIZZA
About Pizza, Some will tell you Italy. That's wrong. What you know as pizza
came into vogue around the time of Napoleon and the French revolution.
Italians, known to be lovers of fine food and wines perfected and imported
this terrific dish to America. From here it quickly endeared itself to mass
production and re-export to the rest of the world. Bon appetite!
INTRODUCTION & HISTORY OF PIZZA HUT
In 1958, Frank and Dan Carney had an idea for a great local pizza restaurant
in Wichita Kansas. The small 25 seat restaurant only had room for 9 letters
on the sign… the building looked like a hut… so 'Pizza Hut' was born!
Fifteen years later, we opened the first UK restaurant and since then we've
become the biggest Pizza Company on the planet, Let see listen Pizza Hut
Story from them!
• 1958 Frank and Dan Carney open the first Pizza Hut in Wichita, Kansas.
• 1972 1000 restaurants are open throughout the USA.
• 1973 Pizza Hut went international with restaurants in Japan, Canada &
England.
The first UK Pizza Hut opened in Islington, London.
• 1977 PepsiCo bought Pizza Hut.
• 1980 Pan Pizza was introduced.
• 1982 The UK joint venture started between PepsiCo and Whitbread.
• 1984 Over 50 restaurants so far in the UK.
• 1986 By now, there were 100 restaurants in the UK and 5000 worldwide.
• 1987 An average of one restaurant opened each week in the UK.
• 1988 The UK's First Delivery Unit was opened in Kingsbury, London.
• 1992 There were 9,000 restaurants in 84 countries.
• 1993 There were 300 restaurants and delivery stores in the UK.
• 1994 10,000 Pizza Huts were open for business.
• 1997 PepsiCo decided to focus on their drinks business. As a result, Tricon
Global Restaurants was born, creating the largest restaurant brand in the
World. Tricon became the partner company with Whitbread.
• 1999 Pizza Hut had over 400 restaurants, employing 14000 people.
• 2002 Tricon Global became YUM! Brands Inc.
• 2006 Whitbread sold their share of the joint venture to Yum! Brands Inc.
Pizza Hut UK Ltd was now 100% owned by Yum!
• 2008 We bought Godfather's Pizza in Ireland with 28 stores.

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 Report and Marketing Strategies of Pizza Hut

Pizza Hut's Mission Statement

We take pride in making a perfect pizza and providing courteous and helpful
service on time all the time. Every customer says, "I'll be back!"
We are the employer of choice offering team members opportunities For
Growth, Advancement, And Rewarding Careers in a Fun, Safe Working
Environment.
• P.E.A.R.L.S
 PASSION for excellence in Doing everything
 EXECUTE with positive energy and urgency.
 ACCOUNTABLE for growth in customer satisfaction and
profitability.
 RECOGNIZE the achievement of others and have fun doing it.
 LISTEN and more importantly, respond to the voice of the
customer.

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 Report and Marketing Strategies of Pizza Hut

COMPARATIVE STRATEGY:
This forced competitors to look for new methods of increasing their
customer bases. Many pizza chains decided to diversify and offer new non-
pizza items such as Buffalo wings, and Italian cheese bread. The current
trend in pizza chains today is the same. They all try to come up with some
newer, bigger, better, pizza for a low price. Offering special promotions and
new pizza variations are popular today as well. For example, chicken is now
a common topping found on pizzas.
In the past, Pizza Hut has always had the first mover advantage. Their
marketing strategy in the past has always been to be first. One of their main
strategies that they still follow today is the diversification of the products
they offer. Pizza Hut is always adding something new to their menu, trying to
reach new markets. For example, in 1992 the famous buffet was launched in
Pizza Hut restaurants worldwide. They were trying to offer many different
food items for customers who didn't necessarily want pizza.
Another strategy they used in the past and are still using is the
diversification of their pizzas. Pizza Hut is always trying to come up with
some innovative way to make a pizza into something slightly different -
different enough that customers will think it’s a whole new product. For
example, let's look at some of the pizzas Pizza Hut has marketed in the past.
In 1983, Pizza Hut introduced their Pan Pizza, which had a guarantee of
being ready to eat in 5 minutes when dining at Pizza Hut restaurants. In
1993, they introduced the "Bigfoot," which was two square feet of pizza cut
into 21 slices. In 1995, they introduced "Stuffed Crust Pizza," where the crust
would be filled with cheese. In 1997, they marketed "The Edge," which had
cheese and toppings all the way to the edge of the pizza. Currently, they are
marketing "The Big New Yorker," trying to bring the famous New York style
pizza to the whole country.
Lastly, Pizza Hut has always valued customer service and satisfaction.
In 1995, Pizza Hut began two customer satisfaction programs: a UAN (in USA
1-800) number customer hotline and a customer call-back program. These
were implemented to make sure their customers were happy, and always
wanted to return. In our plan, we will first give a situation analysis of current
and relevant environmental conditions that affect our plan. Next, we will
give a brief analysis of the current fast food industry, and any trends or
changes that might occur in the future.

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ENVIRONMENTAL AND INTERNAL ANALYSIS OF PIZZA

HUT
In our visit to Pizza Hut we conducted research on PEST (Political, Economic, Social
and Technological) Analysis.
In the internal analysis of Pizza Hut we have considered SWOT of the Company.

PEST (Political, Economic, Social & Technological)

i. POLITICAL ISSUES:
Political issues include regulatory frame work operating in judicial system which
may affect the business in different ways. There are not many political factors in
Peshawar affecting Pizza Hut as is lack of competition. Factors such as laws on
business employment, pollution and taxation apply on the organization which it
has to follow regarding the rules.

ii. ECNOMIC FACTORS:

If the county’s economy is better so the GDP of the country will be good, this is a
green signal for the business as the per capita income of the people will be
increased and they will spend more money. In our survey we came to know that
most of the people in the beginning of the months spend more and they visit pizza
hut very often. When the inflation rate increases the cost of raw material also
increases and this leads towards high prices of the products and vice versa.

iii.SOCIAL FACTORS:
Pizza hut is a multinational and it is basically originated from America so the
organization is overwhelmed by western culture. There are social forms of society
which consist of Upper class, middle class, middle upper class, lower class and
lower class. Every country has cultural norms, values, beliefs and religion which
can affect the organization.

iv. TECHNOLOGICAL FACTORS:

Now a day’s technology is improving so as baking and heating ovens will be of new
and efficient technology and will provide efficient service. Due to new technology
there are new ways of marketing like internet; telemarketing and the organization
can advertise their products with much more faster pace. Computer based
customer data that is MIS (managing information system) helps in collecting
customer data, daily transactions, future forecasting and decision making. New
vehicles will make their service more efficient.

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SWOT ANALYSIS:
Every organization has its strengths, weakness, opportunity and threats. So, the
SWOT analysis for pizza hut is as under:

Strengths:
Pizza Hut is the market leader in providing different products of pizzas as there are
no competitors in this sector. There good image makes the organization more
strong. Pizza Hut is providing good taste, quality products with qualified staff, good
atmosphere and hygienic environment. They are specialized in pizzas. Motivation
level of staff is very high which make the organization more prosperous. They are
ISO (International Standard Organization) certified. They have enough resources
for operating different activities of the organization. They are providing free home
delivery service. They have created monopoly in this sector. Another big Strength
and even a Competitive Advantageis the fact that they have a full service
restaurant as well as delivery services. Most of Pizza Hut's competitors do not have
restaurants. Because of the restaurant, Pizza Hut can market too many different
segments that other pizza chains cannot. For example, Pizza Hut can market to
families much easier than Domino's or Little Caesar's.

Weaknesses:
However, the fact that Pizza Hut does have a restaurant to run is also a weakness.
Pizza Hut has higher overhead costs, due to the restaurant that other competitors
don't have to deal with. Another result of higher overhead costs is higher prices
Pizza Hut must charge. Obviously, Pizza Hut is not the low cost producer. They rely
on their quality pizza and good service to account for their higher prices. They are
providing less range of products comparatively with high prices. They are more
focused on Western taste instead of Eastern.

Opportunities:
New markets can be explored and new opportunities they can gain. Pizza Hut can
come up with the new products considering the Eastern taste of the people as like
McDonalds. Diversification of new products can increase their market share. They
can reduce their prices because of more resources.

Threats:
Pizza Hut's number one threats are from their competitors. Currently,

i. Their closest competitor is Domino's Pizza who is working to open their

Branch at Karachi. Domino's main competitive advantage over Pizza Hut is
their Lower price.
ii. Little Caesar's who is establishing their self in India and might move to

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Pakistan is another one of Pizza Hut's competitors, right behind Domino's in

market share. Little Caesar's is famous for offering large quantities of pizza
for less money.
iii. New entrance like Dominos pizza in Pakistan market can affect their market
share.
iv. Other local restaurants can affect their market share by providing pizzas with
lower price.
v. Social factors can affect their image as a Western organization.
SEGMENTATION:
Main segments which Pizza hut has captured are the combination of
higher incomes and dual career families , due to higher income consumer
have more disposable income , allowing them to eat out more often .
Pizza Hut holds the most market share in the Pizza industry, the
perceived quality and service of the company will help to ensure a better the
average chance at a successful introduction of a new product. The
introduction of a product that keeps with today trends is also important to
reduce the risk of failure.
Pizza Hut maximum market segment is younger generations. These
generation ranges from 12 to 30, the overall spending of these generations
is mostly on non essential items, the higher amount of spending has been
done on eating out.

POSITIONING
Pizza Hut was among the first multinational brands to enter the food
retail sector in Pakistan. When the first Pizza Hut restaurant opened in
Karachi the quick service industry was at a nascent stage and the pizza
category was dominated by a sole regional player who had a marginal
presence. Pizza Hut went on to play a significant role in pioneering and
developing this category in Pakistan.
Worldwide and in Pakistan, Pizza Hut has come to become synonymous
with the 'best pizzas under one roof'. This is because at Pizza Hut the belief
is that every pizza has its own magic, thus making it a destination product –
which everyone seeks. It is this belief that has ignited the passion to create,
innovate and serve the finest product the industry has to offer, while setting
standards for others to strive to replicate. Pizza Hut is committed to
providing uncompromising product quality, offering customers the highest
value for money and giving service that is warm, friendly and personal.

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A critical factor in Pizza Hut's success has been its unique dining
experience. Crew members at Pizza Hut strive each day to provide
'CUSTOMER MANIA' - the kind of service that ensures that every visit of
the customer is a memorable one.
Pizza Hut's constant endeavor to provide extra value – whether it is pizzas
which are available to suit every price range, new promotions or the
introduction of innovative product ranges - that puts a 'Yum' on every
customer's face - has allowed it to increase its presence in Pakistan to the
current 38 restaurants across 9 cities.

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Market Targeting:
Pizza hut targeted market defines them as a family product. This is because they
don’t really directly market their customers. They are target everyone whereas
their competitors target a certain gender or age. But pizza hut targets a wide
range of customers. This is because they want to make the most money and who
blames them.
They have many competitors and they are bound to try everything to cope up
tops. Their competitors are everywhere. There are just a few that are main
competitors and pizza hut will always try to be the best and get the most money
by making their products better quality but also cheaper.
They try to offer something different with their product as well. They offer a range
of stuffed crusts to try and attract customers. They also do vegetarian options with
meet free pizzas and a salad and pasta bar. Not a lot of restaurants offer a salad
and a pasta bar. This is another competitive idea to attract or customers.

STRATEGIES ADOPTED BY PIZZA HUT:

A business's strategy is the pattern of decisions and actions that are taken by the
business to achieve its goals. A business has a variety of goals and objectives. All
businesses need to organize their business activities in order to achieve their
business objectives. Running a business involves planning the current as well as
future activities. Hence, in order to achieve the business objectives, all business
organizations adopt different strategies. Similarly, Pizza Hut has adopted many
strategies which help achieve the targets set by the main office to the local store
opened at Peshawar. Changes are the external as well as internal environment has
led Pizza Hut rethink their past strategies and has therefore designed new
strategies after noticing the changes in the environment. These environmental
changes are seen through the PEST and SWOT analysis. After considering all the
factors Pizza Hut has decided upon the strategies and their current strategies are
divided into five main categories and further have sub-parts. These strategies are:
-

Functional Strategies: -
These are strategies designed to improve the efficiency of a business's operations.
They often focus on an area, such as marketing, human resource etc. All business
organizations adopt strategies at functional level as once the functional objectives
are achieved, corporate objectives become easy. In order to make the functional
strategy efficient, Pizza Hut has made all the functional departments co-operate
with each other.

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Total Quality Management (TQM): -

This is the most important for a food chain like Pizza Hut. All the employees’ back-
of-the-house i.e. the kitchen assistants are trained accordingly. They are given
extra classes in order to meet the quality standards set by Pizza Hut around the
world. This strategy is important in order to satisfy the CHAMPS. This strategy is
strictly implemented in Pizza Hut in order to fulfill the quality standards. Different
quality management staff is also there at Pizza Hut. The shift managers have the
task to observe whether the quality standards are met or not, whereas there are a
total quality management department at the main office in Karachi. This
department has the task to implement quality standards and know whether they
are achieved or not.

Business Level Strategy: -

Business level strategies are plans made to gain a competitive advantage over its
rivals in a market. Hence, all the businesses need to adopt business level
strategies in order to compete in a competitive environment. If we take a look at
the Pakistani market, there are no large competitors of Pizza Hut but unlimited
small competitors exist in the market. The threat of competitors is very low as
there is no international food chain offering pizza in Pakistan at present. Therefore,
present strategies adopted by Pizza Hut are keeping in consideration the present
competition. Whereas, in future this competition will increase and Pizza Hut will
have to change all its business level strategies in order to compete with its rivals.
In very near future Dominos is opening its first branch in Karachi. This would be a
threat for Pizza Hut and hence, the strategies would be changed.

Pricing Strategy: -
The level of competition a business faces determines its pricing strategy.
Sometimes a business has the scope to set its price and sometimes a business
cannot. When a business has the scope to set its price there is a number of pricing
strategies or policies it might choose. As there are no such competitors of Pizza Hut
which could compete with the quality of pizza produced at Pizza Hut, therefore, the
pricing strategy adopted by Pizza Hut is 'market skimming'. Pizza Hut has adopted
this pricing strategy as they want to hold maximum share of the market by
maximum profit. This is a golden era for Pizza Hut, as there are no competitors and
hence, Pizza Hut is free to charge any price they want. They are charging higher
prices due to the uniqueness of the product. They satisfy the target market as the
food quality is worth the price paid. The pricing strategy is not just to get the worth

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of quality but also to gain maximum profits before any competitor enters because
then Pizza Hut will have to change its pricing strategy. Although the prices would
be lowered with the new entrants in the market but not to a greater extent as the
quality food products are not home-produced. They are imported from different
countries keeping in view the best quality.

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Market Share:
As there are Dozens of Pizza Suppliers Globally Providing Services in different part
of the World, but Pizza Hut is the One who got the Bigger Market Share Globally.

This is the Survey taken by www.survey.com that Pizza Hut is having 48% of
Overall Pizza Market in the World. After that Dominos is leading with a percentage
of 20% while the rest 32% is divided in the Remaining Pizza Providers Globally.

MARKET SHARE

OTHERS 32%
PIZZA HUT
PIZZA HUT 48% DOMINO'S
OTHERS

DOMINO'S 20%

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FOUR P’S OF MARKETING

PRODUCT:
Product refers to the actual program you are planning. The goal of
pizza hut is to develop the best product with the resources available. Pizza
Hut sells pizzas in four different sizes: personal (an individual serving), small,
medium and large, though most stores have done away from with the small
size. A variety of toppings are available, plus "specialty" styles, including
Meat Lovers, Pepperoni Lovers, Cheese Lovers, Veggie Lovers, Double
Cheeseburger, Supreme, Super Supreme and the newly introduced Pizza
Mia. The pan pizza has a thicker crust than most other commercially
available pizzas .so their products have help them to retain their customers
and to increase them .they provide their customers with complete nutrition
plan and healthy food is guaranteed. The nutrition plan also clearly tells
diabetes patients can use what range of food at pizza hut. Over weight
patients are also satisfied and the pizza with less cholesterol can be ordered.
This encourages the customers to visit pizza hut rather than going
elsewhere. As pizza hut has to boost its sales in the existing markets, so
they the new food products are introduced in all branches line-by–line
because all branches are operated in co-operation with one another.
Different products for different regions are also developed as there are
choice differences. Pizza hut offers a long list of products and never afraid to
offer new products like in Peshawar according to market they introduce the
very first "Chapli Kabab Pizza" which was very healthy product by Pizza hut
in this region. There are a lot many products according to different
geographical places. Like in India they have got there vegetable pizzas,
which has a large market there BUT not the Cow Meat Pizza.

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PRICE:
. As there are no such competitors of Pizza Hut which could compete with
the quality of pizza produced at Pizza Hut, therefore, the pricing strategy
adopted by Pizza Hut is 'market skimming'. Pizza Hut has adopted this
pricing strategy as they want to hold maximum share of the market by
maximum profit. This is a golden era for Pizza Hut, as there are no
competitors and hence, Pizza Hut is free to charge any price they want. They
are charging higher prices due to the uniqueness of the product. They satisfy
the target market as the food quality is worth the price paid. The pricing
strategy is not just to get the worth of quality but also to gain maximum
profits before any competitor enters because then Pizza Hut will have to
change its pricing strategy. Although the prices would be lowered with the
new entrants in the market but not to a greater extent as the quality food
products are not home-produced. They are imported from different countries
keeping in view the best quality.
First, this pricing strategy will help segment the market. Different
groups of customers are willing to pay different prices for the same product.
The high/low pricing strategy will also create excitement. The pricing
strategy adopted by Pizza Hut is 'market skimming'. Pizza Hut has adopted
this pricing strategy as they want to hold maximum share of the market by
maximum profit. This product will emphasize product and service quality

PLACE/DISTRIBUTION:
It refers to the best place to offer program. That is the place where it is
located and through what channels are we distributing programs and the
competitive advantage lies in distribution. The pizza hut Peshawar is
situated out of the market area near Army Stadium and Shami road. This site
has been chosen keeping in view the following factors. It is in an out of
centre location on retail or Leisure Park with good parking accessibility.
Secondly the catchment area is of a specified minimum size and within a
given drive time to the site.
Distribution The type of distribution channel used by Pizza Hut is the direct
channel. The direct channel is successful when there is an extremely large
market that is geographically dispersed. The direct channel is also useful
when there are a large number of buyers, but a small amount purchased by
each.
Pizza Hut uses three different methods of selling its products directly to
the market.
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i. The first method of distribution used by Pizza Hut is Home. Office

delivery. Customers can call Pizza Hut ahead of time, place an order,
and the order is delivered to the customer's home.
ii. Another method of distribution is for customers to dine-in. Customers
can go to the nearest Pizza Hut, place an order and either leave with
the order or eat at the restaurant. One of Pizza Hut's largest
competitive advantages is its restaurant style facility. Pizza Hut offers a
clean place to sit down and enjoy the variety of pizzas, salads, and
sandwiches in a fun, family atmosphere.
iii. The third method of distribution is to order Online. Selective County
Customers can now go on the Internet and place an order for Pizza.
This method is useful because it allows customers to view the entire
menu, download any special coupons, and order without having to
disclose any credit card numbers.

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PROMOTION:
The objectives of promotion are to introduce a new product, stimulate
demand, change the short-term behavior of the customers, and encourage
repeat or greater usage by current customers. Pizza hut uses many
promotional strategies. The main promotion is a coupon to purchase. This
promotion is also distributed mainly by mail, but also by fliers on college
campuses around the country in order to reach the target market.They are
using billboards on main stream places to get there customer. They are also
distributing door to door brochures to capture more and more customers.
Pizza huts also using marketing techniques. These are the strategies Pizza
hut is using for its marketing. Pizza huts try's to attract the younger
generation as their main market segment. Apart from this Pizza Hut is using
intense marketing strategies they are also giving ads in magazines.
Advertising camping will creates awareness of the products in our target
markets.

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CONCLUSION

Pizza Hut has many targets which it has achieve in a given period of time. The
time-period is mostly a year. Therefore, in order to fulfill the targets different
strategies are adopted by Pizza Hut. It can be concluded that these strategies have
been successful and there is flexibility in the strategies, as they can be changed
with the changes in the market conditions as well as the targets.

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REFERENCES

Mr. Amir Zeb, Shift Manager, Pizza Hut, Peshawar

Mr. Hamad Zeb, Shift Manger, Pizza Hut, Peshawar

Lower staff of Pizza Hut, Peshawar

Google Search Engine

www.definitions.com
www.answers.com
www.about.com
www.wikipedia.org
www.pizzahut.com

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