Struggling pizza giant Pizza Hut unveiled its newest promotion Wednesday which may help declining sales, as the chain has faced seven consecutive negative quarters: a $5 personal pizza which may appeal to budget conscious customers.
The chain's "Crafted Flatzz" represents a mixup from Pizza Hut's signature thick crust, offering instead a thin, crispy base targeted at lunchtime diners seeking affordable options. Available for a limited period, the single-serving pizzas are only available until Nov. 9.
The chain's second-quarter performance highlighted its competitive disadvantages, with U.S. sales dropping 5 percent while major competitors posted gains following their own recovery efforts.
Market leader Domino's after experiencing first-quarter U.S. sales declines, the chain rebounded after new menu additions and changes to their loyalty program. The launch of a premium Parmesan Stuffed Crust Pizza, an improved rewards system, and Domino's partnership with DoorDash for delivery services were all recently introduced, as same-store sales in the United States grew to 3.4 percent in the second quarter.
Papa Johns similarly made a comeback with a 1 percent sales increase after multiple quarters of declining results. The chain's focus on core pizza offerings rather than side items and sandwiches reflects in its sales, with pizza orders surging 6 percent.
Yum! Brands, Pizza Hut's parent company, CEO David Gibbs described Pizza Hut said during an Aug. 5 earnings call that the company hadn’t been offering value deals during a “competitive value landscape.”
Pizza Hut has ramped up promotional efforts beyond the new Crafted Flatzz launch. The chain extended popular deals including $2 Personal Pan Pizzas on Tuesdays and Wing Wednesday specials.
The Crafted Flatzz lineup features five flavor profiles: Nashville hot chicken, chicken bacon ranch, three cheese, pepperoni, and "The Ultimate" with multiple toppings including pepperoni, Italian sausage, caramelized onions and cheese. The promotional $5 price point applies exclusively to orders placed before 5 p.m., with higher pricing thereafter.
Pizza Hut's current challenges echo previous financial struggles difficulties. In 2020, the chain faced major challenges when major franchisee NPC International declared Chapter 11 bankruptcy. The franchisee, which operated 1,227 Pizza Hut locations representing roughly 20 percent of the chain's 7,000 U.S. restaurants, closed approximately 300 units.
NPC International's bankruptcy filing cited multiple pressures including the COVID-19 pandemic, evolving consumer dining preferences, rising labor and commodity costs, and excessive financial leverage as factors leading to the restructuring.
The company's current value-focused strategy with Crafted Flatzz represents its latest effort to recapture market share in an increasingly competitive landscape where customers prioritize both quality and affordability.