pizza hut-report

Report and Marketing Strategies of Pizza Hut

A PRESENTATION REPORT ON
PIZZA HUT PESHAWAR

ACCEPTED TO
SIR IMRAN WAZIR

ACCEPTED BY:

ADNAN KHAN
MUJAHID HUSSAIN
NAVEED SAEED
SHAHZAD TAHIR
ZARTASHIA ARSHAD

BBA (HONS) - C
1st Semester

Institute of Management Sciences, Peshawar Pakistan Page 1


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 Hut 5
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 Management) 12
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



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



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.



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.



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.



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.



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.



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 Advantage is 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 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.

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.



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.



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 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.



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.



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.



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.

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.



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.



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.



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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