Pizza Hut Case StudyPizza Hut Case StudyExecutive SummaryPizza Hut started out as a pizza parlor opened up by two brothers in Topeka, Kansas. Today, the company has restaurants all over the world and its annual sales are in the billions. The growth of the company was due to a good product being delivered at a good price and offering perceived value. The company has adjusted to new entrants into the market and has managed to stay ahead of the competition.
The philosophy for growth is simple: Take care of the customer, and the customer will take care of you. Pizza hut focused on providing good customer service in order to create customer loyalty. In return, the customer will return and more importantly, the customer will become an advocate.
Customer feedback programs were put into place in order to measure the customer experience and also to uncover opportunities. The restaurant managers are paid bonuses based on the result from their respective customers. The problem was that the company noticed that managers of underperforming locations where receiving bonuses while managers of extremely profitable locations were not. Recommendations have been made in order to fine tune the bonus plan so that manager incentives will be balance between profits and customer service.
Pizza Hut is a pioneer and continues innovation with its service initiatives and product lineup. As long as the company keeps focusing on its customers, then the company will still be a leader for generations to come.
Table of ContentsHistory & Background………………………………………….………..….4Customer Loyalty Program………………………………….……………5Macroenvironment Variables………………………………………..……..6Microenvironment Variables…………………………………….…………7TOWS Analysis…………………………………………………………..…..8Threats………………………………………………………………………..8Opportunities……………………………………………..………………….8Weaknesses……………………………………………………………………8Strengths………………………………………………………………..……..9Recommendations & Rationale……………………..………………………9Conclusion………………………………………………………….……….11VIII.References…………………….……………………………………………..12Questions………………………………………………….…………………13I. History & BackgroundPizza Hut was started in 1958, by two brothers in Wichita, Kansas. Frank and Dan Carney had the idea to open a pizza parlor. They borrowed $600 from their mother, and opened the very first Pizza Hut. In 1959, the first franchise unit opened in Topeka, Kansas.(Grumpert, 1989) Almost ten years later, Pizza Hut would be serving one million customers a week in their 310 locations. In 1970, Pizza Hut was put on the New York Stock Exchange under the ticker symbol PIZ.
In 1986, Pizza Hut introduced delivery service, something no other restaurant was doing. By the 1990s Pizza Hut sales had reached $4 billion worldwide. In 1998, Pizza Hut celebrated their 40th anniversary, and launched their famous campaign “The Best Pizzas Under One Roof.” (PizzaHut.com 2007) In 1996, Pizza Hut sales in the United States were over $5 million. However, Pizza Huts market share has slowly eroded because of intense competition from their rivals Dominos, Little Caesars and newcomer Papa Johns. Home delivery was a driving force for success, especially for Pizza Hut and Dominos. Competitors started 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
cost, but usually the old pizza doesn’t last long.
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Pizza Hut has long been lauded for one thing: being fast, inexpensive, and comfortable. The fact remains that the chain has been successful without really putting up a fight.
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A successful restaurant chain may be able to offer more options for its customers than one typically gets from rivals, especially because the people who make them want the best and get the best. The chain does not, however, offer a monopoly. The people who make up the chain know what to do with themselves and the business is a family business, so it is not a business at all. (Pizza Hut 2012)
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We did not want to get in an argument with other competitors that we didn’t have to offer good pizza. We wanted to be at our best and we knew that was one of the most important things in our business, and even though we could not compete, we did. And we do not like other brands, nor did I want to compete with them. And they took our business. We were all proud to do it.
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We will always believe Pizza Hut and Pizzeria Hut provide the best pizza for our customers. We will always do everything we can to make sure that Pizza Hut continues to provide and compete in the global Pizza game. Thank you
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