A Project Report on (1)

7/30/2019 A Project Report on (1)

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A Project Report on

PRICING STRATEGY of Pizza hut

(20011 - 2013)

Submitted in partial fulfillment of the requirement of

Masters of Business Administration (MBA)

Guru Gobind Singh Indraprastha University

SUBMITTED BY: Submitted to:

Gitarattan international business school

Madhuban chowk,rohini,delhi-85

(Affiliated to Guru Gobind Singh Indraprastha University)


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Table of Contents

chapter page

Chapter 1 1-14

Introduction

About Pizza Hut Company History Overview of the Industry in India

Chapter 2 15-17

Research methodology

Secondary source

Objective and scope

Chapter 3 18-24

Industry profile

Current Market Scenario

Competitors Market share


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Chapter 4 25-26

Data analysis

Chapter 5 27-29

Conclusion

Recommendation

Chapter 6 30-32

References

Bibliography


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Chapter 1


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Introduction

Pizza hut is the largest pizza Restaurant Company in the world. It has 12000

outlets in 90 countries employing more than 3 lakh people. The legacy of pizza

hut began in 1958.

In India there are not much outlets, out of 10 86 countries India is one of them

but only in 9 cities pizza hut has its outlets.

Tricon global; restaurants which owns the Pizza hut Franchisee has become very

popular in India in the Indian Pizza Market. The first Pizza Restaurant was opened in

1958 in Wichita, Kansas under the name Pizza hut and features a variety of pizzas with

different toppings as well as pasta, salads, sandwiches and other food chains. For the

last ten years Pizza hut was named as the worlds best pizza chain in America and in

India also it has captures most of the market share. Pizza hut is the largest pizza

restaurant company in the world.

The project gives an overview of the history of pizza hut as in how pizza hut

started and where all it is present and what has its progress been till now has

been covered.


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Company Profile

About Pizza Hut

Pizza hut is the largest pizza restaurant company in the world. It has 12000

outlets in 90 countries; employing more than 30000 people. Pizza Hut has an

aggressive expansion plan for India. It intends to have more than 100 outlets by

the end of the year Pizza Hut has more than 12,500 units across 90 countries

making it one of the largest pizza brands. Further, all new outlets in India would

be franchisee owned resulting from the smooth functioning of the existing stores

which are all franchisee owned. Hence, the same arrangement will be followed in

the future to ensure growth-oriented results

The data written below represent what Pizza hut is all about and gives a brief

profile of the company.

Their main quote:

"Customer are the reason that we are here."

No customers No PizzasThats the secret ingredient.


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The 5 secret principles:

Employees are our secret ingredients. Show your "care". Say "yes" to customers Satisfied, capable teams create satisfied customers. Satisfied customers create profit and growth PIZZA HUT IS ALL ABOUT

Its all about you and all about customers i.e. customer creation and customer

retention through customer satisfaction, its all about team spirit, team spirit in

order to attain good results.

"WE SUCEED BECAUSE WE KNOW HOW TO WORK TOGETHER "

They specify

"How we work together principles"

CUSTOMER FOCUS: They listen and respond to the voice of the customer.

BELIEF IN PEOPLE: They believe in people, trust in positive intentions,

encourage ideas from everyone and actively develop a workforce that is diverse

in style and background.

RECOGNITION: They find reasons to celebrate the achievements of others and

fun doing it.

COACHIONG AND SUPPORT: They coach and support each other


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ACCOUNTABILITY: They do what they say they are accountable, they act like

owners.

EXCELLENCE: They take pride in their work and have a passion for excellence.

POSITIVE ENERGY: They execute with positive energy and intensity. They hate

bureaucracy and all the nonsense that comes with it.

TEAM WORK: They practice team together and team apart.

They call themselves

C=Cleanliness

H=Hospitality

A=Accuracy of orders

M=Maintenance of facilities

P=Product quality

S=Speed of service

They answer questions like:

"What influences a customer decision to a restaurant?

Food appeal=31%

Food experience=50%

Food value=13%


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CER= CHAMPS EXCELLENCE REVIEW

CEM=CUSTOMER EXPERIENCE MONITOR

"HANDLING CUSTOMERS"

Solve problem before it actually becomes a complaint. Never argue with the customer Never blame any other crew member Treat the customer, as you want to be treated. Thank the customer.


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Company History

Pizza huts story began with a small restaurant and two young brothers- Dan and

Frank Carney. In the year 1958 they were struck by inspiration and opened the

first Pizza hut in Wichita, Kansas, USA.

When they were setting up, they only had room for 25 seats- and the restaurant

sign only had space for nine letters. They wanted pizza in the name, which left

space for just 3 more letters. Because the building looked like hut----- Pizza hut

started.

Now Pizza hut is the largest pizza Restaurant Company in the world. It has 12,000

outlets in the 90 countries, employing more than 300,000 people.

The first pizza hut restaurant was opened in 1958 in Wichita , Kansas and

within a year the first franchise unit was open.

By 1977 when Pizza hut was acquired by Pepsi co its US restaurant system

had grown to nearly 3200 units today Pizza hut is the largest restaurant

chain in the world . Specializing in the sale of ready to eat Pizza products as of

year-end 1996 concept had grown to more than 12300 units.


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For ten of the last 12 years, Pizza hut was named best pizza hut chain in

America in the Choice in chains national consumer survey published

annually by restaurants & Institutions magazine . Also, the January 1997

Consumer reports named Pizza hut as the best Pizza chain in America and now it

has opened.

With every occasion Pizza hut adapts its ambience and decoration with a different

concept, like wise in India on the Independence day they decorate their outlets

with all national colors and logos etc., and on the valentines day for example they

take out their pizza in heart shape to attract more ofyoung customers which get

more attracted towards these things.


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Companys DEtail

INTERNATIONAL OPERATIONS

Mexico

Typical location in Mexico, equipped with scooters for pizza delivery. Pizza Hut

restaurants are located throughout the world. Based on their location and the culture

of the people, Pizza hut often offers different menu choices in these countries than in

the United States and Canada.
http://www.answers.com/topic/mexico-country-north-americahttp://www.answers.com/topic/scooterhttp://www.answers.com/topic/united-stateshttp://www.answers.com/topic/canadahttp://www.answers.com/topic/canadahttp://www.answers.com/topic/united-stateshttp://www.answers.com/topic/scooterhttp://www.answers.com/topic/mexico-country-north-america


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Australia & New Zealand

In Australia, Pizza Hut has followed a different model , Australian Pizza Huts now generally

operate as take away and delivery operations with all Orders processed by two major call

centers located in Brisbane and Sydney. Australian Pizza Hut restaurants currently compete

with Domino's, Pizza Haven, Eagle Boys and various others Pizza stores. Pizza Hut stand in

Oslo Airport

India

Pizza Hut came to India in 1996 with a dine-in restaurant in Bangalore Pizza Hut now

has a presence in many major Indian cities such as Bangalore , Chandigarh, Ludhiana,

Jalandhar, Udaipur, Lucknow, New Delhi, Bangalore , Chandigarh, Ludhiana, Jalandhar,

Udaipur, Lucknow, Amritsar, Cochin, Agra, Hyderabad (with multiple branches in many of

those cities), Ahmedabad, Indore, Mangalore, Mysore, Visakhapatnam and Bhubaneswar.
http://www.answers.com/topic/australiahttp://www.answers.com/topic/take-away-3http://www.answers.com/topic/pizza-deliveryhttp://www.answers.com/topic/brisbanehttp://www.answers.com/topic/sydneyhttp://www.answers.com/topic/domino-s-pizza-inchttp://www.answers.com/topic/pizza-havenhttp://www.answers.com/topic/eagle-boyshttp://www.answers.com/topic/oslo-airport-gardermoenhttp://www.answers.com/topic/la-indiahttp://www.answers.com/topic/1996http://www.answers.com/topic/bangalorehttp://www.answers.com/topic/city-jane-siberry-albumhttp://www.answers.com/topic/bangalorehttp://www.answers.com/topic/chandigarhhttp://www.answers.com/topic/ludhiana-1http://www.answers.com/topic/jalandharhttp://www.answers.com/topic/udaipur-1http://www.answers.com/topic/lucknowhttp://www.answers.com/topic/new-delhihttp://www.answers.com/topic/bangalorehttp://www.answers.com/topic/chandigarhhttp://www.answers.com/topic/ludhiana-1http://www.answers.com/topic/jalandharhttp://www.answers.com/topic/udaipur-1http://www.answers.com/topic/lucknowhttp://www.answers.com/topic/amritsarhttp://www.answers.com/topic/kochi-india-1http://www.answers.com/topic/agra-divisionhttp://www.answers.com/topic/hyderabad-andhra-pradeshhttp://www.answers.com/topic/ahmedabadhttp://www.answers.com/topic/indore-1http://www.answers.com/topic/mangalorehttp://www.answers.com/topic/mysore-statehttp://www.answers.com/topic/visakhapatnamhttp://www.answers.com/topic/bhubaneswarhttp://www.answers.com/topic/bhubaneswarhttp://www.answers.com/topic/visakhapatnamhttp://www.answers.com/topic/mysore-statehttp://www.answers.com/topic/mangalorehttp://www.answers.com/topic/indore-1http://www.answers.com/topic/ahmedabadhttp://www.answers.com/topic/hyderabad-andhra-pradeshhttp://www.answers.com/topic/agra-divisionhttp://www.answers.com/topic/kochi-india-1http://www.answers.com/topic/amritsarhttp://www.answers.com/topic/lucknowhttp://www.answers.com/topic/udaipur-1http://www.answers.com/topic/jalandharhttp://www.answers.com/topic/ludhiana-1http://www.answers.com/topic/chandigarhhttp://www.answers.com/topic/bangalorehttp://www.answers.com/topic/new-delhihttp://www.answers.com/topic/lucknowhttp://www.answers.com/topic/udaipur-1http://www.answers.com/topic/jalandharhttp://www.answers.com/topic/ludhiana-1http://www.answers.com/topic/chandigarhhttp://www.answers.com/topic/bangalorehttp://www.answers.com/topic/city-jane-siberry-albumhttp://www.answers.com/topic/bangalorehttp://www.answers.com/topic/1996http://www.answers.com/topic/la-indiahttp://www.answers.com/topic/oslo-airport-gardermoenhttp://www.answers.com/topic/eagle-boyshttp://www.answers.com/topic/pizza-havenhttp://www.answers.com/topic/domino-s-pizza-inchttp://www.answers.com/topic/sydneyhttp://www.answers.com/topic/brisbanehttp://www.answers.com/topic/pizza-deliveryhttp://www.answers.com/topic/take-away-3http://www.answers.com/topic/australia


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Product Profile

Featured items

Now stuffed with even more delicious, melted cheese in the crust, making your last bite as

good as the first!

Double Deep Pizzas are hand-crafted by loading the entire pizza with twice the toppings of

a medium pizza,. Choose from three great recipes: Supreme Deep, Meaty Deep, and Veggie

Deep.


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SPECIALITIES

Your choice of two fresh toppings smothered in mounds of cheese.

Has six kinds of meat: pepperoni, Italian sausage, ham, bacon, beef and pork toppings.

Fresh mushrooms, red onions, green peppers, tomatoes and black olives make this a

veggie-fan's favorite.


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SIGNATURE CRUSTS

Our pizzeria-style pizza is now made with a light flavorful new crust and more of our zesty

Italian sauce in every bite.

America's favorite thick-crust pizza -- crispy on the outside, soft and chewy on the inside.

America's favorite thick-crust pizza -- in a smaller, single-serving size.


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Now stuffed with even more delicious, melted cheese in the crust, making your last bite as

good as the first!

Just enough crispy crust to get a mouthful of toppings in every bite.


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Chapter 2


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RESEARCH METHODOLOGY

OBJECTIVES OF STUDY

To study how direct marketing is done by PIZZA HUT, to substantiate its effortto strengthen its direct marketing.

To study about PIZZA HUT as a brand in India. To know about the long and successful history of PIZZA HUT. To study the working and functioning of PIZZA HUT in India and the world. To study the pricing policy of pizza hut To study PIZZA HUTS and competitors strategies. To give recommendations and suggestions thereof.

SCOPE OF STUDY

The subject matter has been arranged in a Systematic manner, providing all thedetails and Explanations needed.

Every effort has been taken by to make the Project report complete in itself. This report has been divided into sections and sub sections for a better understanding.


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TYPE OF DATA COLLECTED

SECONDARY SOURCE

WEBSITES MAGAZINES AND NEWSPAPERS


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Chapter 3


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Current market Scenario

Key players (COMPETITORS)

Papa John's Internationalmakes a lot of dough. The company operates the

world's #3 pizza chain (behind YUM! Brands' Pizza Hut brand and Domino's) with

about 3,000 pizzerias across the US and in almost 30 international markets. Its

restaurants offer several pizza styles and topping choices, as well as a few specialty

pies such as The Works and All the Meats. Papa John's locations typically offer

delivery and carry-out service only. It owns and operates more than 580

locations, while the rest are franchised.

Founder and chairman John Schnatterowns about 17% of the company.

Pizza Corner

Pizza Corner is a chain of pizzerias founded in 1996 by entrepreneur Fred Mouawad of

Global Franchise Architects. Pizza Corner currently operates in Bangladesh, India and

Thailand.

As its name suggests, Pizza Corner primarily focuses on pizzas. They also serve numerous

side dishes such as Garlic Bread and Chicken Nuggets. Starters like pasta and salad are

becoming increasingly popular. Pizza Corner recently introduced pizza in a cone in India

under the brand Conizza.
http://en.wikipedia.org/wiki/Pizzeriahttp://en.wikipedia.org/wiki/Entrepreneurhttp://en.wikipedia.org/wiki/Bangladeshhttp://en.wikipedia.org/wiki/Indiahttp://en.wikipedia.org/wiki/Thailandhttp://en.wikipedia.org/wiki/Thailandhttp://en.wikipedia.org/wiki/Indiahttp://en.wikipedia.org/wiki/Bangladeshhttp://en.wikipedia.org/wiki/Entrepreneurhttp://en.wikipedia.org/wiki/Pizzeria


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Dominos

Jubilant FoodWorks Limited, a Jubilant Bhartia Group Company holds the Master Franchise

Rights for Domino's Pizza for India, Nepal, Sri Lanka and Bangladesh. The company has

been listed on the Indian bourses recently. Prior to Sep 24, 2009, the company was known

as Domino's Pizza India Limited and underwent a name change, rest of the terms remaining

the same.

Over the period since 1996, Domino's Pizza India has remained focused on delivering great

tasting Pizzas and sides, superior quality, exceptional customer service and value for

money offerings. We have endeavored to establish a reputation for being a home delivery

specialist capable of delivering pizzas within 30 minutes or else FREE to a community of

loyal consumers from all our stores around the country.

Domino's constantly strives to develop products that suit the tastes of our consumers and

hence delighting them. Domino's believes strongly in the strategy of 'Think global and act

local'. Thus, time and again we have been innovating with delicious new products such as

crusts, toppings and flavours suitable to the taste buds of Indian Consumers. Further

providing value for money and affordable products to our consumers has been an

important part of our efforts.


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pricing strategies

Pizza hut ideology ofcustomer behind its pricing strategy .

Willing to pay for relevance . Willing to pay for excitement. Willing to pay for quality. Willing to pay for simplifying life. Willing to pay for forward movement.

Pizza hut is not playing pricing games with customers.They following high/low pricing strategy.

In simple words it is applying PRICE SKIMMING strategy for its products.

A product pricing strategy by which a firm charges the highest initial price that customers will pay. Asthe demand of the first customers is satisfied, the firm lowers the price to attract another, more price-

sensitive segment.

Thus in order to provide maximum value to customers and enhance the brand value it sometimes

maintains the same price, while some time reduce prices and some time increase prices also.

i.e in India pizza hut introduce THE GREAT INDIAN TREAT. It didnt increase price of existing pizza but

reduce quantity of products in its value meal combo.

Pizza hut follows one-price strategy, means it charges same price to all customers under similarconditions and for same quality. This helps in establishing a favorable fair image among its customers as

well as having stable market.


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SWOT ANALYSIS

STRENGTHS

It promises to deliver the pizzas in 30 minutes or offers free pizzas if ord er doesntreach on time, whereas its competitors promise to deliver the pizzas in 39 minutes.

The way in which they do up their ambience, the atmosphere, the sitting area, theway in which

They greet the customers and the way they sing and make everyone have fun onoccasions.

A contemporary design split level seating, high ceiling and aesthetic pizza hutmurals.

Pizza hut was the first to start online pizza delivery in San Francisco, which stillhasnt been started by any of its competitors.

Variety is the main strength they possess. They offer pastas, spaghetti, garlic breadetc.

They are known to modify their menu and ambience according to occasions. e.g.,they offer heart shaped pizzas on Valentine s Day.


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WEAKNESSES:

Its focus on the delivery concept is not much as compared to its competitor. Their variety as far as pastas and spaghetti are concerned are not much as

compared to pizza express and pizza corner.

The prices at pizza hut are comparatively more expensive than dominos. The pizza hut ad aaa she doesnt like pizzas has down rated their salads just to

prove their pizzas superior and they have shown that their salads are not good,

this is a major weakness in their Adverti sement.

One of the weaknesses of pizza hut is lack of efficient cold chains in the country.The company surmounted this problem, by reducing the dependency on cold

chains besides setting up its own infrastructure.


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OPPORTUNITIES:

The first ad campaign on TV defines pizza hut as a brand and what it offers to itsexisting and potential customers. In future, focus will be on other facets of the

brand and offerings.

It could start on line delivery in India and other countries like it has started in theU.S.

It could open more outlets in shopping malls, airports, railway stations etc. Mumbai is an important center, which has still not been tapped by pizza hut. This

city has a potential for 30 outlets.

To open an outlet in those areas where the competitors have opened, likedominos in Agra etc.

THREATS:

Amul has come up with a 30 rupees pizza, which is a big threat to pizza hut atleast in the short run if not in the long run.

Variety in pizza express and pizza corner as far as pastas, spaghettis etc. areconcerned is much much more, and this has been checked by us by looking at

their menu cards.

Dominos offers CHEESE WALA HUNGER a regular hand toast pizza for rupees 39.


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Chapter 4


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data analysis

COMPARISON WITH ITS BIGGEST COMPETITOR DOMINOS

COMPARISON BETWEEN DOMINOS AND PIZZA HUT

Companys

products

Target

customers

Benefits price Value proposition

DOMINOS

PIZZA HUT

Convenience

minded pizza

lovers

Youngsters

within the age

group of 13 to

30

Delivery

speed and

goodquality

Good quality

and extra

toppings

along with

Italian serving

15%premiu

m

20%

premium

A goodhot pizza

delivered to your

door within 30

minutes of

ordering at a

moderate price

Unbeatable pizza

at unbelievable

prices.


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Chapter 5


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Conclusion

Through the market research of the industry it can be concluded thatmarket for pizza is

growing tremendously. Though pizza hut owns a good share but it faces extremely tough

competition from Dominos.


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Recommendations

Pizza hut should improve on developing products for all age groups instead ofconcentrating on only young crowd.

Pizza hut should also concentrate on areas like appetizers. Dominos leads in thissegment.

The chain should improve on its delivery and promotional tactics. Dominos is doingwell in this area too.

They should use more well-known celebrities as brand ambassadors, who can relatewell with the middle class.


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Chapter 6


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Bibliography

References

BOOKS REFERRED:-

MARKETING MANAGEMENT PHILIP KOTLER

MARKETING MANAGEMENT - C.B. GUPTA

MAGAZINES REFERRED:-

BUSINESS TODAY

OUTLOOK

BUSINESS WORLD

INTERNET SITES:-

WWW.PIZZAHUT.COM

WWW.GOOGLE.COM

WWW.ANSWERS.COM

WWW.HOVERS.COM

WWW.KNOWLEDGESTORM.COM
http://www.pizzahut.com/http://www.pizzahut.com/http://www.google.com/http://www.google.com/http://www.answers.com/http://www.answers.com/http://www.hovers.com/http://www.hovers.com/http://www.knowledge.com/http://www.knowledge.com/http://www.knowledge.com/http://www.hovers.com/http://www.answers.com/http://www.google.com/http://www.pizzahut.com/


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