Major pizza chains such as Domino’s, Pizza Hut, Papa John’s, plus all the mom and pop restaurants comprise the diverse landscape of the pizza industry. With 77,727 restaurants in the US, the pizza industry is valued at $46.34 billion in the United States and $154.8 billion worldwide. in fact, Americans eat 3 billion pizzas per year, or 46 slices of pizza per person per year.
Therefore, one might wonder how this multi-billion dollar industry stays ahead of the curve?
Even during a worldwide pandemic, people were still buying pizza, and the drop in traffic was only 8 percent.
Maybe it’s because pizza is iconic, and one big pie can still feed the whole family, or maybe it’s because the industry is well-positioned to tackle the pandemic with the help of technology.
Digitization
The first online order came in 1994. It was pizza. Then in 2009, the first pizza app was launched by Pizza Hut, Domino introduced a tracking system in 2008. And in 2020, we saw voice ordering, pizza kits, discount codes, loyalty programs, special options, app orders, automation and delivery robots immediately.
Technological advances have become the norm. Third-party service apps like GrubHub, Slice, DoorDash and UberEats are changing the market by introducing marketplaces and increasing order volume by 10 percent.
Customers value speed and efficiency, and we can see it in the numbers:
- Grubhub is worth about $4 billion, and recently purchased by Just Eat in a $7.3 billion deal.
- Slice is a startup that helps local pizza joints become competitive in the market. The company received a $43 million investment from KKR this year, and was placed on the Unicorn list last month.
- Uber Eats bought Postmates for $2.65 billion.
- Doordash holds a 35 percent market share in the US, and is valued at $16 billion.
- Domino’s leads the way with nearly 50 percent market share, and for the first time in 2020, the company sold more pizzas than Pizza Hut (their largest franchise filed for bankruptcy last month).
All of the above tells us that digitalization and technology play an important role when it comes to market share. People need convenience and innovation, especially at times like this.
A person in any part of America today can order any pizza dish in seconds, just one tap and have their meal in under an hour.
Digital Marketing
The big pizza chains and third-party services are the ones that set the trends, not only in technology but also in marketing. And they fully digital as social media advertising and marketing has proven its worth in income.
For example, a Pizza Hut ad campaign focuses on geographic and psychographic segmentation variables for more specific targeting. Domino’s is working on brand positioning (it works), and pushing its message that it’s so well known for – delivery in under 30 minutes or free pizza.
Slice, on the other hand, seeks to promote local pizzerias across all media channels, and increase the online presence of these restaurants. Plus, each restaurant gets access to a market filled with pizza lovers, which means more visibility to a more qualified audience.
Google, Facebook, Instagram, and Snapchat have allowed companies to expand (and target) their reach, and these advances in digitalization and technology have allowed the pizza industry to survive the Covid-19 pandemic – and even come out on top.
