News

New business models coming to Pizza Hut UK

August 18, 2011

Pizza Hut locations in the UK are going upscale in response to increased competition from rivals such as Pizza Express.

According to Marketing Week, the restaurant chain is testing a number of initiatives in four "Alpha Hut" concept stores to transform its business from a product-based to an experience-based model.

Jaclyn Schnau, marketing director of brand development, told the magazine that the company hasn't kept up with the times.

"We put the blinders on and said 'customers will still come' and you know what, they didn't," she said in the story. "We had some real soul searching to do and fundamentally we've realized that we have to move from a product-based to an experience-based offer."

Schnau hopes the new stores will make customers feel "uninhibited, embraced and light-hearted." One concept being tested is called Pizza Parade and could replace the lunch buffet to move away from "trough feeding." The idea comes from upscale Argentinean restaurants that have waiters bring trays of fresh pizza to customers' tables.

From the story:

"Once we bring the brand back and make it relevant to them and accessible we are hitting the right chord and people are coming back," Schnau said. "People love Pizza Hut; they were just waiting for us to keep up with their life. Eventually the goal is to find out the best way to go forward."

Parent company Yum! Brands reported weak performance for Pizza Hut UK in the second quarter of this year. In contrast, Pizza Express earnings have steadily increased and plans to open 200 more stores throughout the country.

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