Pizza Hut, Domino’s and Papa Johns have all crystallized as leaders in the pizza industry. Many Americans would likely name one of the three if asked to choose their favorite quick-service pizza chain (although Little Caesars and Marco’s Pizza are also hot on their heels.)
Declaring any of these three brands the best would be no easy task, but recent sales reports show that Pizza Hut had a particularly strong end to 2022, while Domino’s and Papa Johns struggled in some areas. .
It’s a particularly impressive feat since Domino’s and Papa Johns have edged out the rival brand in the pizza wars for the past two years. Domino’s has overtaken Pizza Hut as the world’s largest pizza chain by number of stores in 2021, having already done more in system-wide sales. Pizza Hut also had to close hundreds of locations due to the COVID-19 pandemic and saw year-over-year sales plummet in 2020, while Domino’s and Papa Johns posted impressive gains.
This trend began to change in 2022. Pizza Hut’s international same-store sales increased 1% during the year, although its US sales fell 1%. The fourth quarter of 2022 is where the channel really shined. Same-store sales in the United States increased 4% in the quarter, while its US network’s overall sales increased 5%.
What exactly could be the reason for this strong performance? David Gibbs, CEO of Pizza Hut’s parent company, Yum! Brands, revealed during the latest earnings call that the launch of the new portable fondants line in October was a big driver for sales.
Pizza Hut Melts are similar to what you would get if you fold two pieces of pizza together. Cheese and toppings are locked in the chain’s signature Thin and crispy crust, while the final product comes with a dipping sauce. Pizza Hut touted it as a good, quick option for solo eaters and customers who want a meal they can take on the go. But customers also seemed drawn to the product’s affordability of $6.99, as inflation and high costs stretched consumers’ wallets.
Gibbs said interest in inexpensive meal options has grown, and Pizza Hut Melts was one of the Yum! The best offers from brands to meet this demand. He noted that the product helped attract individual customers who might not want to shell out an entire pizza, as well as “recovering” customers from lower-income households due to its price.
To top it all off, Pizza Hut boosted its sales by 30% on DoorDash and Uber Eats by participating in marketing campaigns with the delivery platforms, according to Gibbs. Yum! Brands exceeded analysts’ expectations For earnings and revenue for the quarter as a whole.
These positive findings from Pizza Hut’s fourth quarter report stand in stark contrast to the consequences of Domino’s and Papa John’s unveiling their own reports on February 23. Sales in America. Domino’s shares fell more than 11% after the earnings announcement, while Papa John’s shares fell 6%, according to CNBC.
While Pizza Hut managed to attract more budget-conscious customers in the fourth quarter with its $6.99 Melts, some Domino’s and Papa John’s customers were forced to cut back on consumption at the chains after the two increased their prices to combat the high costs of food, labor and other basic commodities. Domino’s particularly angered some of its fans by changing the prices or value of two popular offers.
Additionally, unlike Pizza Hut’s recent success on the delivery side, Domino’s faces an ongoing shortage of delivery drivers that has impacted sales and delivery times. Unlike Pizza Hut, Domino’s does not use third-party delivery services that could take the strain off its employees.
Papa John’s also faced a shortage of delivery driver staff in 2022, but the chain’s CEO said in May that partnerships with DoorDash, GrubHub and Uber Eats were improving the problem.
It’s unclear if Pizza Hut will be able to win the pizza wars in the longer term, but for now, the chain has something to brag about.
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Zoe Strozewski
Zoe Strozewski is a staff writer for Eat This, Not That! A Chicago native who now lives in New Jersey, she graduated from Kean University in 2020 with a bachelor’s degree in journalism. Learn more about Zoe
