Pizza hut marketing report 2013

L ETTER O F A CKNOWLEDGEMENT

June 1st, 2013

Mr. Javed IqbalSenior coordinator

Indus University

Karachi

Dear Readers :

Great ideas fuse into one another to give birth to one Great Idea. Similarly, behind every

success lies another successful hand.

First of all we would like to thank Almighty God, for helping us out and guiding us in the

honest tracks of our findings.

We thank Miss Bushra who imparted us the necessary knowledge of Principles of

Marketing so that we could reach approximately correct conclusions. and also thank to

our senior co-ordinater Sir Javed Iqbal to allow our assigned group. This report has

enabled us to apply all that we studied in class and gave us the chance to enhance our

knowledge.

Our parents and grand-parents too, for their constant support throughout the report and

the numerous cups of coffee that they made for us during the nights that we spent

working on the report .

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Indus University , Karachi Page 1

L ETTER O F T RANSMITTAL

Mr.

Indus University,

Karachi.

Dear Mr.

We have prepared a Report on “Pizza Hut Pakistan” and found it to be an interesting

subject to work on and have tried our level best to understand how to explore and then

document a professional report.

We did the necessary secondary research to get sufficient information about the topics

in order to complete the report.

We are pleased to inform you that the final report you assigned to our group has been

completed and is ready for your perusal. This report as per your instruction has covered

all the authentic areas of concern and contains all the relevant information. We would

dearly like to thank you for the faith you showed in our capabilities and the

encouragement you gave us when assigning the report.

We will be more than glad to respond to any queries that you might have regarding our

report.

Sincerely yours,

Abdullah Ali

Faiza Khan

Hina Iqbal

Jawad Ahmed

Usama Zaki __________________ SIGNATURE


E XECUTIVE S UMMARY

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.


T ABLE O F C ONTENTS

S.no Topic Pg # 1 Letter of Acknowledgement 1

2 Letter of Transmittal 2 3 Executive Summary 3 4 History Of Pizza 5

5 Introduction & History of Pizza Hut 6 6 Pizza Hut In Pakistan 7

7 Pizza Hut Mission Statement & Vision 8

8 Market Segmentation of Pizza Hut 9-10 9 Product Development Function 11 10 Marketing Mix 12-15 11 Target Marketing 16-17 12 Branding 18

13 Promotional & Advertising Strategies 18 14 Sales Strategies 19

15 Marketing Intelligence & Customer Value & Satisfaction 20 16 BCG matrix 21 17 Conclusion 22 18 Recommendations 23 19 Resources 24


H ISTORY O F P IZZA

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!

The word "pizza" may be a derivative of the Latin word "picea", a Roman word used to describe the blackening of bread in an oven. The word "pizza", in its current spelling, emerged sometime in the middle Ages. It was used to describe both the sweet and salty pies that were becoming popular among Italian aristocracy. Pizza is basically a meal prepared in a plate made of bread. There are four main components of a basic pizza pie.They are crust, sauce, cheese and toppings.


I NTRODUCTION & H ISTORY O F P IZZA H UT

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.

P IZZA H UT I N P AKISTAN


Pizza Hut was introduced in Pakistan in December 1993. Mr. Manzar Riaz from Lahore is credited with introducing it to Pakistan when he opened up the country's first Pizza Hut outlet. Pizza Hut opened its outlets in Pakistan in 1993, which was three years before India had its first Pizza Hut outlet in 1996. It was December 1993 when Manzar Riaz merged with Corlney , as a result of this association MCR Pvt Ltd , gives birth to Pizza Hut Pakistan . The 1st outlet of Pizza Hut Pakistan was opened in Karachi ( The Biggest City of Pakistan ) at Board Basin Clifton . Second was at Tariq Road and after that its all history And after approximately 17 years later they have 42 outlets all over which is covering 10 major cities of Pakistan .

Recently the latest outlets of Pizza Hut was open in Sialkot and Gujranwala , respectively .

P IZZA H UT’S M ISSION S TATEMENET


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.

“ To be the best pizza for every pizza occasion ”

“ Alone we are delicious, together we are YUM ! ”

• 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.

V ISION O F PIZZA HUT

• To make the people know that for all the eating items they desire to eat can be made available in minimum time without much effort and excluding money

• To improve the well-being of our customers, community and people connected to ourenterprise. “RUN GREAT RESTURANTS”


M ARKET S EGMENTATION

A market segment is a subgroup of people or organizations sharing one or more characteristics that cause them to have similar product / service need .

Broad Potential Market :During the marketing research that we conducted, we learned that their target market isbasically who have their personal cars, who comes for shopping, offices, students ofvarious grades In order to formulate an effective marketing and promotional strategy, the target market for Pizza Hut has divided into 4 different segments based on Geographic variables, Demographics variables, Psychographic variables, and Behavioral variables .

Geographic Variables· Twenty percent Urban population of Pakistan

Demographic Variables· Age: All age group· Gender: Both male, female

Psychographic Variables· Social class: Upper Class, Upper Middle Class, Middle Upper class.

Behavioral Variables


Geographic:

Geographic segmentation of Pizza Hut is worldwide. Now Pizza Hut is serving more than 80 countries including Pakistan, UK, USA, Algeria, India, Russia, Cyprus, China, and Bangladesh etc…

But we’ll talk about the Pizza Hut Pakistan. Pizza Hut Pakistan’s geographic segmentation is the developed cities. Pizza Hut is available in Lahore, Karachi, Islamabad, Faisalabad, Hyderabad, Multan, Peshawar, Sialkot, and Rawalpindi. We can observe that pizza hut is available on all provincial capitals of Pakistan.

Demographic:

Pizza Hut’s general market segment is younger generation. But they go wide in this thing. They segment high incomes and business class families which can spend money on the best pizzas in the market. Pizza Hut’s global slogan is also describing its market segmentation that is “Now it’s time to eat more”. But in Pakistan, the slogan is “Share the good times”. Pizza Hut Pakistan offers Halal foods to all its customers.

Psychographic:

Pizza Hut’s psychographic segmentation includes people with having good attitude about food sense especially pizza group and they want to have a good time with their friends and family as described in Pizza Hut Pakistan slogan. It serves all types of personalities as they don’t have any product for specific personality.

Behavioral:

Pizza Hut’s behavioral segment is the class where people love to spend money on eating.


P RODUCT D EVELOPMENT F UNCTION

In order to achieve success and customer satisfaction , Product development fuction plays a key role in an organizaton . And that’s what Pizza Hut is doing since its birth .

Pizza Hut is very loyal to their customers , that is why there customers always feel delight . Pizza Hut know that Product Development Function is very important in order to retain customers intact towards them .

To satisfy the customer NPD ( New Product Development ) is introduce after every eight weeks , that is the policy of Pizza Hut . They offer new variety so that customers cann’t get bored from those offers which they have already experienced . And this year as wel , they offer Vegetable Pizza 1st time in Pakistan .

For Product Development Function , they take certain steps regularly .

Whenever new flavor is being developed , it is tasted by there in house staff . Once they are satisfied of that new flavor than that product goes for a trail . Customers are the one who tastes that new flavor . Then customers were asked about the price as what price customer find

reasonable .

After going through certain steps , it takes 2 – 3 months process for the final outcome .


M ARKETING M IX

Marketing mix is the combination of 4 p’s.This combination and the best strategies makes pizza hut a perfect brand in all over the world. These four p’s are:

1.P RODUCT

Pizza hut is to develop the best product with the resources available. Pizza Hut sellspizzas 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 areavailable, plus "specialty" styles, including Meat Lovers, Pepperoni Lovers, Cheese Lovers,Veggie Lovers, Double Cheeseburger, Supreme, Super Supreme and the newly introduced Pizza Mia.Pan Pizza was launched nationally in 1980. More than twenty years later, their customers love it so much that nearly every other pizza they sell is a Pan Pizza. The pan pizza has a thicker crust than most other commercially available pizzas. Therefore, their products have helped them to retain their customers and to increase them .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 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. Besides the pizzas, Pizza Hut also serves pastas, starter, sandwiches, and deserts.


2.P RICE

The pricing strategy adopted by Pizza Hut is 'market skimming'. Pizza Hut has adopted this pricing strategy, as it wants to hold maximum share of the market by maximum profit. Pizza Hut is free to charge any price it wants. 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. 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. As focusing on the pricing strategies, Pizza Hut has made some product mix. According to the sizes of the pizzas, prices are made. They offer pizza sizes such as personal pan, which is of 6 inches, regular of 9 inches, and then come the large of 12 inches. Different pizzas have different prices according to their sizes. Pizza Hut sets a high initial price for its products to send a signal to customers that its products are quality and the service is excellent.

Pizza Hut also has MEAL DEALS. This scheme gives some discounts of additions along with pizzas. In the meal you get starter, pizza and desert with reasonable prices. In the MEAL DEALS, they offer time out, yuppie delight, extra time, and family ties. These deals are made according to the satisfaction of the customer.


3.P LACE

Pizza hut has 34,000 outlets in 100 Countries. 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. In Pakistan, Pizza Hut introduced itself in 1993, having 42 outlets in ten cities. Secondly, the catchments area is of a specified minimum size and within a given drive time to the site.

The direct channel is also useful when there are a large number of buyers, but a small amount purchased by each. Pizza Hut Delivered Pizzato space in Year 2001, which made them More Famous.

Pizza Hut uses three different methods of selling its products directly to the market.

1. 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.

2. Another method of distribution is for customers to dine-in. Customers can go to thenearest Pizza Hut, place an order and either leave with the order or eat at therestaurant. One of Pizza Hut's largest competitive advantages is its restaurant stylefacility. Pizza Hut offers a clean place to sit down and enjoy the variety of pizzas,salads, and sandwiches in a fun, family atmosphere.

3. The third method of distribution is to order Online. Selective County Customers cannow go on the Internet and place an order for Pizza. This method is useful because itallows customers to view the entire menu, download any special coupons, and orderwithout having to disclose any credit card numbers.


4.P ROMOTION

Promotion is the advertising, personal selling, sales promotion and public relation. Pizza Hut has advertised their products through various means, which include Newspapers, TV, Radio, Magazines, and Billboards. Promotional plans have been made proper in positioning of the product. 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. They are also distributing door- to- door brochures to capture more and more customers. Pizza huts also using marketing techniques. Pizza hut is using these strategies 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. In 2000, Pizza Hut was a part-time sponsor of Galaxy Motorsports. Pizza Hut was the shirt sponsor of English Football Club. In 2005, Pizza Hut sponsored “The Simpsons” on Channel 4.In March 2007, Pizza Hut partnered with Verizon Wireless to offer a free LG mobile phone with the purchase of a Cheesy Bites Pizza.2007-08 Pizza Hut is a sponsor of the Newcastle Vipers ice hockey team for the season in the UK. They have made many sales or discounts to target their customers. In different occasions, Pizza Hut has made different schemes to capture their customers. Such as, Winter Treat, Meal Deals, Midnight Deals and the famous one Ramazan Deals.


B asis O f S electing T arget M arkets :

There are number of basis on which pizza hut selects those target markets for their business. Number one is that they want the people with a bit high income and food lovers. Who are ready to spend and enjoy the best food in best environment.

There are not only Muslims in Pakistan but also some minorities that are living their lives. They want some vegetarian food and pizza hut is the only brand that offers some vegetarian stuff to their customers. Due to the image of brand, vegetarians trust pizza hut for best food in town. Visitors, who come to Pakistan, don’t go back without paying visit to Pakistan’s food market. Pizza hut has also selected it’s target market on the basis of this thing so that it could provide the more and more to their customers and more than just food as the pizza hut Pakistan slogan is “Share the good times”.

T arget M arketing :

Pizza hut targeted market defines them as a family product. They don’t really straight market their customers. Middle and high class family background people are the target market of Pizza Hut. Like it has been discussed above about the people who are highly paid employees and good businessmen is the target market of Pizza Hut. But pizza hut focused a broad variety of customers. We can also say that Pizza Hut is targeting the generation X which is more active in spending money on non essential things like eating. Pizza Hut is also offering products for vegetarians. The company is offering meat free pizzas with salad and pasta so that people who don’t want to eat meat could enjoy the quality and best food of Pizza Hut. Pizza Hut is also very good place for the students of colleges and universities. Many students arrange the treat parties in Pizza Hut that made Pizza Hut to earn more and more. Sometimes, it becomes hard to get a single seat in Pizza Hut due to all its good and attractive offers and marketing mix.

Pizza Hut is targeting their customers by two types.


1. Dine in is for those who love to have good times with their friends and age fellows and some families.

2. Take away is for those who don’t have reach to any Pizza Hut outlet and they want Pizza Hut products. They can give the order on phone and may have their pizza at their home as Oven-Hot

Pizza Hut is also offering different kinds of meals to their customers. If anybody is not interested in Pizza , Pizza Hut has targeted those customers too. It offers

Pastas Sandwiches Desserts

to those kinds of people. People who’re ill or not allowed to have pizzas, pastas can enjoy Pizza Hut’s meal deal with soup and salads.

Pizza Hut also targets to executive class people for meetings and discussion by offering them hot and cold deals. Pizza Hut also arranges tea parties to those customers according to their agenda and time.


BRANDING:

LINE EXTENSION:

They launch their pizzas and sandwiches in changing style or flavours

RANGE EXTENSION:

They also launch other food items like pizza to spicy wedges, potato skins

A DVERTISING S TRATEGIES

The advertising strategy for Pizza Hut is two-fold.

Firstly, laying emphasis on it being an international brand with Pakistani heart

Pizza Hut’s communication is reflective of family values, family bonding, etc.

Secondly, highlighting the premise that the pizza is a catalyst that brings people together ensures that this is a brand that connects with the Pakistani consumer

Pizza Hut spends approximately Rs 10-12 crore on advertising annually using a media mix of print, television and radio.

P ROMOTIONAL S TRATEGIES

Promotion are so very important for an organization , like any other organization same applies to Pizza Hut as well . Pizza Hut Pakistan promotional strategies are as follow

They promote their latest deals offer in several local websites for e.g www.geo.tv

They follow below the line activities like Bill Boards , Bridge Pannels , Door to door policy , cable advertisement and magazines

And you often find there promotinal campaigns running in universities and colleges etc


http://www.geo.tv/

S ALES S TRATEGIES

Pizza Hut being the leader among fast-food restaurant in Pakistan have versatility in their sales strategies , as they follow a vast channels and mediums to sale their product to the customers .

The medium and channels they follow are of 3 types

Dine – In Delivery Take away

Through Dine–In facility they facitilate there customers with their lavish services and customer relationship .

Through Delivery facility they make their customers delite by providing Oven-Hot Pizza , right at customers door-steps .

Through Take away facility , customers can take their food where ever they like .

Apart from this , there are many other sales strategies Pizza Hut follow like they go to customers door-step to give awareness about their new products , deal and offers , and also provide them coupons of which customers can avail discounts as well


M ARKETING I NTELLIGENCE

In order to maintain 7 – 8 lacs customers anually , Pizza Hut Pakistan has strong Marketing Intelligence team . They know how to delight customers and keep them satisfied for a longer period of time .

Being the leaders in Pizza Industry , they know pizza is there core product and what more varieties should offer to keep themselves different from others in the market . Their marketing intelligence team keeps themselves up to date with current environment , first they try the products and then launch them in the market .

C USTOMER V ALUE & S ATISFACTION

Pizza hut create certain expectations among its customers, is fulfilling it accurately, and get a good image in minds of customers. Its customers are satisfied by its quality as it satisfies their expectations. They give basic priority to their customers.

Customer relationship management (CRM):

Pizza hut build and maintain profitable customer relationships by delivering superiorcustomer value and satisfaction. In 1995, Pizza Hut began two customer satisfactionprograms:a. 1-800 number customer hotlines and a customer callback program. These wereimplemented to make sure their customers were happy, and always wanted to return.b. They have full service restaurant as well as delivery services.

Exchange & relationships:

Pizza hut has maintained very good relationships with its customers. It believes onexchange through relationships. They create relationships by offering the best productand best services to their customers for example they are offering to their customershome delivery services & providing products according to customer’s require



C ONCLUSION

Pizza Hut has many targets, which it has achieve in a given period. The time-period ismostly a year. Therefore, in order to fulfill the targets different strategies are adopted byPizza Hut. It can be concluded that these strategies have been successful and there isflexibility in the strategies, as they can be changed with the changes in the marketconditions as well as the targets.

Strategy is only as good as its execution. Not just product, but an experience. Need to be just a step ahead…in sync with the consumer’s perception of value. Customers move to the lower cost provider when marketers stop giving them

reasons.

Pizza Hut's Secret of Success

The reason behind Pizza Hut's success all over the world is its steadfast belief and uncompromising drive in providing customers the best in terms of product quality, service, cleanliness and value .

Pizza Hut pizzas are made with fresh dough baked daily and smothered with our very own Pizza Hut special tomato sauce, meat toppings, vegetables and a double layer of 100% pure imported Mozzarella cheese .

Pizza Hut culture is integrity.

Invest heavily in our people through skills training and management development.

expertise, innovative ideas and hard work .


R ECOMMENDATIONS

There are some points, which Pizza Hut must follow to have more customers and increase sales and profit in the market and in order to finish the threats.

Pizza Hut should focus on more advertisements, as in Pakistan, they are not making advertisements. They should telecast their advertise more and on the right time when their loyal customers and the target customers are watching the television. By this, they are positioning their products in their customers’ minds. They should make an attractive one in which they are differentiating their pizzas in quality, taste and tells that how nutrition and healthy meals they are offering.

More advertisements of Pizza Hut is been watched by the customer then the variety seeking buying behavior of the customer will also decrease. The customers will becomeloyal to it.

They should make discounts cards or the membership cards for the loyal customers.Those customers who mostly go once in a week or after two weeks.

They should reduce their price as compare to the competitors’ price and if not thenthey should differentiate their product in their quality and taste. They should also tellthat they are using more toppings and cheese.

They must sponsor more concerts and games held in Pakistan, as they do not do. Bythis, they will make a good reputation to towards their customers.

They should make stalls in the universities and colleges when there are some partiesheld. In the stalls, they must offer pizzas in student discounted prices.

In order to move effectively into the rapidly progressing world of social responsibility, itis time for business’ to expand their vision.

They should make its own website in which customers can place an online order.Customers can now go on the Internet and place an order. This method is usefulbecause it allows customers to view the entire menu, download any special coupons,and order without having to disclose any credit card number.


R ESOURCES

· Google Search Engine· www.definitions.com· www.answers.com· www.wikipedia.org· www.pizzahut.net.pk

According to our knowledge all the information and queries in this report are correct. We all read it carefully and we all are agree with this.

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______________________ SIGNATURE Head Of Marketing Miss Bushra Akhter

