Competition in the Pizza Industry

The pizza industry is one of the largest in the world of fast food, with an estimated 10% of all food sales in the country going towards the myriad thriving pizza restaurants and delivery joints scattered throughout the country. While independent chains and frozen pizzas purchased from grocery stores are popular in their right, they’re minor competition to the big three: Pizza Hut, Domino’s, and Papa John’s. These three pizza delivery restaurants (Pizza Hut actually has sit-down restaurants in some areas) compete for the majority of the pizza sold in the United States, and the facts and figures say it all:

-93% of Americans eat pizza at least once a month.
-Approximately 100 acres of pizza are eaten each day. This equates to 350 slices of pizza per second
-17% of all restaurants in the country are pizza joints
-3 BILLION pizzas are sold annually in the United States every year

Naturally, competition among these pizza places is huge. Due to locality and limited number of restaurants, smaller, more independent chains are never considered among the leaders, even if they deliver. As such, the big three, including smaller chains such as Hungry Howie’s and Blackjack fight endlessly to offer the best pizza and the best deal. For example, Domino’s just came out with its new Deep Dish pizza, making the claim that other places use frozen dough for their deep dish. This is just one of many examples of a pizza place attempting to revamp its pizza and its image to compete. Domino’s doesn’t really need the help - they’re the #1 pizza delivery place in the country - but with Papa John’s offering a newer and easier to use website, and Pizza Hut offering some of the best deals in the country, it’s no surprise that these companies will do everything they can to stay on top.



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Much of the competition comes down to pricing and options. When these pizza places first burst onto the scene, you were pretty much limited to pizza, breadsticks, and soft drinks. Despite being staples, the companies branched out, offering chicken wings, boneless chicken, desserts, sandwiches, and even salads. As a result, new items are being released on a yearly basis. Pizza Hut struck a chord with its novelty pizzas, such as the Stuffed Crust Pizza and the Cheesy Bites Pizza (itself a variation of the Stuffed Crust), while Domino’s introduced new Artisan pizzas. It never ends, with the deals, some continuous, some seasonal, serving as a major selling point.

When it comes to independent chains, however, competition is locally based, with many offering more than just traditional pizzas. Although “pizza” restaurants, local joints tend to sell a mixture of items that fall under the umbrella of “Italian food,” promising more options at a slightly more expensive price. One of the selling points and major forms of competition between the big three are coupons, something local chains tend to avoid or offer in smaller numbers. This doesn’t mean they don’t exist, however, they’re just limited in what they offer.



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By contrast, Pizza Hut, Domino’s, and Papa John’s all offer a multitude of coupon options, both in print and right from their website. Simple coupons, such as those devoted to singular pizzas are always popular, but those that pair numerous items for low prices remain the driving force behind several ad campaigns. The undisputed king of deals is Pizza Hut, who is currently offering their Big Dinner Box, which comes with two square pan pizza, five breadsticks, and your choice of pasta, pizza rollers, or wings. Throw in a free two liter soda and you’re feeding a family of five for super cheap.

In the end, however, pizza competition comes down to personal taste. You can offer all the deals in the world, but so many consumers are devoted to specific brands, and all the deals in the world can’t sway a Papa John’s fan to order Domino’s, no matter how many times they try to revamp their pizza or their sauce. Of course, there’s no such thing as bad pizza, so for many, whoever offers the best deal will emerge the victor, thus forcing the pizza industry and the Big Three to constantly evolve and offer the best possible deals.

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Posted on October 23, 2012 at 9:00 AM