The Pizza Market in The U.S.

The Pizza Market in the U.S.
:
Foodservice and Retail
2nd Edition
September 2012
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The Pizza Market in the U.S.: Foodservice and Retail,

2nd Edition
September 2012
The Pizza Market in the U.S.: Foodservice and Retail, 2nd Edition has been prepared
by Packaged Facts. We serve consumer product and service companies and allied
businesses in the United States and internationally with a complete line of research
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Author
David Sprinkle
David Morris
Kaleidoscope Research Consulting
Publication Date
September 2012
LA6739179
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Pizza at Foo
oodservice and Retail
R
Table of Co
ontents
Tableo
ofContents
Chapterr1:ExecutiiveSummary............................................................................................................1
Scopeand
dMethodolo
ogy...............................................................................................................................................................1
ReportScope.....................................................................................................................................................................................1
Reportresourccesummary..........................................................................................................................................................1
Reportsummary.......................................................................................................................................................2
SizeandSeg
gmentation:PizzaatFoo
odservicean
ndRetail..........................................................2
MarketS
Summary
yanalysis..........................................................................................................................................................................2
Th
herestauranttside........................................................................................................................................................................2
Th
heretailside...................................................................................................................................................................................2
PizzaUse
ebyChanne
el&Type................................................................................................................................3
Summary
yanalysis..........................................................................................................................................................................3
FoodCon
nsumption&
&Migration
nTrends:Pla
acingPizzai
inContext.......................................................4
Summary
yanalysis..........................................................................................................................................................................4
PizzaontheMenu:M
MenuTrend
dAnalysis.......................................................................................................5
Summary
yanalysis..........................................................................................................................................................................5
Restaura
antPizzaPu
urchaseDeciisionandEa
atingExperiience..................................................................6
Summary
yanalysis..........................................................................................................................................................................6
Delivery
yv.Pickup,C
Chainv.Inde
ependent&MenuItemOrdering........................................................7
Summary
yanalysis..........................................................................................................................................................................8
PizzaUp
ptakeMotiva
ators........................................................................................................................................8
Summary
yanalysis..........................................................................................................................................................................9
RetailPizzaManufacturer,Bran
nd&NewPrroductAnaly
ysis....................................................................9
yanalysis.......................................................................................................................................................................10
Summary
NestlUSSA......................................................................................................................................................................................10
Schwan.............................................................................................................................................................................................11
Mills..................................................................................................................................................................................11
GeneralM
PizzaRestaurantBrrandAnalysiis....................................................................................................................12
hen............................................................................................................................................................12
CaliforniaaPizzaKitch
M
Menubuzz
........................................................................................................................................................................................12
Healthierintroductions.............................................................................................................................................................12
ustomertraffiicanddemogrraphictrends........................................................................................................................12
Cu
Dominoss.........................................................................................................................................................................................13
In
nnovationand
dactivity..............................................................................................................................................................13
ArtisanPizzapromisesqualiity;providesu
upsellingamm
munition...........................................................................13
Newmenuintrroductionanallysis...........................................................................................................................................13
ustomersegm
mentationbym
mobiledeviceinteraction................................................................................................14
Cu
Keyconsumerggroups.................................................................................................................................................................14
0092012Gueesttrafficfreq
quencyanalysiis.....................................................................................................................14
20
LittleCaeesarsPizza.....................................................................................................................................................................15
Prromotionalacctivity....................................................................................................................................................................15
Technologyinn
novation...............................................................................................................................................................15
20
PapaJohn
ns.....................................................................................................................................................................................16
Brandingthatrreflectsquality
ypositioning.........................................................................................................................16
Sttrategypayinggoff.......................................................................................................................................................................16
In
nnovationand
dactivity..............................................................................................................................................................17
Prromotionalacctivity....................................................................................................................................................................17
Septemberr 2012
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Table of Co
ontents
Technologyinn
novation...............................................................................................................................................................18
ustomersegm
mentationbym
Cu
hlyengagedwo
omen........................................................................................................................................18
Attractinghigh
quencyanalysiis:positivemo
omentum........................................................................19
20
PapaMurrphys..............................................................................................................................................................................19
M
Mobilemarketi
ingstrategy.......................................................................................................................................................19
Cu
ustomersegm
mentationbym
Th
hePapaMurp
physConsumeer................................................................................................................................................20
20
Cu
ustomersegm
mentationbyfo
oodlifestyle..........................................................................................................................20
PizzaHutt.........................................................................................................................................................................................21
Newmenuintrroduction&prromotionanallysis...............................................................................................................21
M
Mobilereach...
................................................................................................................................................................................21
20
Chapterr2:MarkettSizeandForecast................................................................................................23
Markets
sizeandfore
ecast.....................................................................................................................................24
Fo
orecastsumm
mary........................................................................................................................................................................24
Restaura
antpizzama
arketsizean
ndforecast.................................................................................................24
Graph21
1:Restauran
ntPizzaMark
ketSize&Forrecast,20072014.......................................................................24
Fullserviicepizzaresttaurantsalessgrowthouttpaceslimited
dserviceseggment.............................................25
Graph22
2:FullServicce&LimitedServiceRestaurantPizzaMarketSize&Forecastt,
20072014................................................................................................................................................................................25
Declininggshareofresstaurantsalees.....................................................................................................................................25
Table21
1:PizzaRestaaurants:SharreofRestaurrantSales,by
ySegment,20102012.....................................25
Largestp
pizzachainseekeoutgrow
wth..................................................................................................................................26
Atsmallercom
mpetitorsexpeense?.........................................................................................................................................26
Table22
2:Top10PizzaRestauran
ntChains,Sy
ystemwideSaales:200920
011..................................................26
Retailpizzamarketsizeandforrecast...........................................................................................................27
3:RetailPizzzaMarketSizze&Forecastt,20072014
4..................................................................................27
Graph23
Frozenpiizzasaleshitttingawall............................................................................................................................................27
Graph24
4:RetailPizzzaMarketSizze&Forecastt,Frozen&R
RefrigeratedSegments,
20072014................................................................................................................................................................................27
Mxtrendingdownward................................................................................................................28
CPGpizzaasalesatFDM
Table23
3:CPGPizzaS
Sales:Frozen
nPizza,RefriigeratedPizzza&PizzaPrroducts,byCaategory,
20112012................................................................................................................................................................................28
hare................................................................................................................................29
Privatelaabelgrowssaales,takessh
Table24
4:CPGPizzaS
Sales,PrivateeLabelSharee,byCategorry,2011201
12......................................................29
Table25
5:CPGPizzaS
Sales,PrivateeLabelSharee,byCategorry,2011201
12......................................................29
Retailfro
ozenpizzamaanufacturershare............................................................................................................................30
Nestlreigns,b
butshareatNeestlandSchw
wandips......................................................................................................30
Table26
6:Top12Fro
ozenPizzaManufacturerSales,20112012........................................................................30
Majorbraandsindecline;growthccomingfromthebottom...........................
.
..........................................................31
Table27
7:Top15Fro
ozenPizzaBrrandSales,20112012.........................................................................................31
Retailfro
ozenpizzabrrands:compaanyshare.....................................................................................................................32
Table28
8:Sweet16F
FrozenPizzaBrands:Salees,SalesSharre,ParentCompany
SalesSShare,2012...................................................................................................................................................................32
ii
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ontents
Onthefasttrack:frozzenpizzabraandgrowthleeaders................................................................................................33
9:Sweet16F
FrozenPizzaGrowthBran
nds&LineExxtensions:Saales&
Table29
SalesG
Growth,2012...............................................................................................................................................................33
Growthd
doesnotdiscriminateonprice.............................................................................................................................34
Roomforvalueeandpremium
mgrowth.................................................................................................................................34
Table21
10:Sweet16FrozenPizzaaGrowthBraands&LineE
Extensions:...........................
.
.....................................
Sales,SalesGrowth
h&UnitPriccing,2012...................................................................................................................34
Chapterr3:PizzaUsebyChan
nnel&Type
e........................................................................................35
Introducttion...................................................................................................................................................................................35
Universalllyaccepted..................................................................................................................................................................36
Nearuniv
versaluseof
f pizzarestau
urants............................................................................................................................36
Pizzausa
agepenetra
ationandpo
opulationun
niverse..................................................................................37
Higherusagepenetrationam
mongrestaurantdineinand
ddeliverythan
nfrozenpizza...................................37
Table31
1:PizzaUsagePenetrationandPopulaationUniverse,
byDisstributionCh
hannel/PizzaType............................................................................................................................37
Takeout/deliveeryoptionuseedmostfrequeently..............................................................................................................38
M
Morethanhalf
ofallpizzasaaretakeout/deeliveryorfrozzen......................................................................................38
Table32
2:PizzaUsageFrequency
y,PizzasEateenandUsageShare,..........................................................................
byDisstributionCh
hannel/PizzaType............................................................................................................................38
Gendera
analysis:wo
omentilttoh
homebased
dpizzasourrces/types....................................................39
Table33
3:PizzaUsage&Usage,by
yDistributio
onChannel/P
PizzaType:G
GenderAnaly
ysis.........................39
Ageanallysis:Preparredfoodsre
elationshipt
tothesuperrmarketbassket..........................................40
Table34
yDistributio
onChannel/P
PizzaType:A
AgeAnalysis.................................40
HHincom
me......................................................................................................................................................................................41
Table35
yDistributio
onChannel/P
PizzaType:H
HHIncomeAn
nalysis.................41
Presenceofchildren...................................................................................................................................................................42
yDistributio
onChannel/P
PizzaType:P
PresenceofChildren................42
Table36
Populatio
ondensity......................................................................................................................................................................43
Table37
yDistributio
onChannel/P
PizzaType:P
PopulationDeensity...................43
Chapterr4:FoodCo
onsumption
n&MigrattionTrendss:PlacingP
PizzainCon
ntext................44
Introducction............................................................................................................................................................45
Trendtow
wardhealthiieroptionsan
ndawayfrom
mpizza..............................................................................................45
M
Messagetopizz
zapurveyors.....................................................................................................................................................45
Graph41
1:FoodConssumptionTreends:EatingMore,Same&Less.....................................................................46
Aquestio
onofrelevance.............................................................................................................................................................47
Restaurantpizzza,homecook
kedmeals,lefttovershighlyrrelevant...........................................................................47
Prreparedfoodss,Hispanic/Laatinofoodsafrresh/refrigeraatedpizzaleasstrelevant..........................................47
Graph42
2:FoodConssumptionTreends:Consum
merRelevance...............................................................................47
Nettingittout..................................................................................................................................................................................48
Netpositive:fo
oodswithheallthierprofiles;;netnegative:pizza,pizzaaandpizza............................................48
Graph43
3:FoodConssumptionTreends:Momen
ntumAnalysis................................................................................48
Restaurantpizza:netnegative,wiithexception
nofyouth..........................................................................................49
1:FoodConsu
umptionTreends:EatingM
MoreRestau
urantPizza:D
Demographicc
Table41
Assesssment..............................................................................................................................................................................49
Frozenpiizzatrendmoredire:nettnegativeam
mongallanaly
yzeddemogrraphics..........................................50
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ontents
Table42
2:FoodConsu
MoreFrozen
nPizza:Demo
ographicAsssessment.............50
Refrigeraatedpizza:neetnegative,eevenamongccoreusers........................................................................................51
Table43
3:FoodConsu
MoreFresh//Refrigerated
dPizza:Demographic
Assesssment..............................................................................................................................................................................51
Chapterr5TheCon
nsumer:PizzzaMenuT
Trends&R
RetailNPD................................................52
Overview
w...................................................................................................................................................................53
Pizzaonm
morethanathirdofrestaaurantmenu
us..........................................................................................................53
Table51
1:Pizzaonth
heMenu:ResstaurantPeneetration,bySSegment,201
12....................................................53
Butadow
wnwardtren
ndisafoot..............................................................................................................................................53
Table52
2:Pizzaonth
heMenu:ResstaurantPeneetration,200
082012...................................................................53
Pizzacrossescuisiness................................................................................................................................................................54
3:Pizzaonth
heMenu:Pen
netration,byRestaurantC
CuisineSpecialty,2012...................................54
Table53
Topprotteins:highffatproteinsabound,pro
ovidingopp
portunityforrleanerpro
oteins...............55
Table54
4:TopPizzaP
Proteins:ResstaurantPen
netrationbyR
RestaurantSegment,201
12............................55
Vegetableesunderscorreconsumertastevariety
y;untappedp
potential.................................................................56
Table55
5:TopPizzaV
Vegetables&
&RelatedInggredients:Pen
netrationby
yRestaurantSegment,
2012............................................................................................................................................................................................56
ning............................................................................57
Topcheeses:feta,goaat,gouda&asiagonotjusstforfinedin
6:TopPizzaC
Cheeses:ResstaurantPeneetrationbyR
RestaurantSeegment,2012............................57
Table56
Topsauces:traditionandwholesaaleborrowin
ngreigns............................................................................................58
7:TopPizzaS
Sauces:RestaaurantPenettrationbyReestaurantSeggment,2012...............................58
Table57
Topvarieeties..................................................................................................................................................................................59
Table58
8:TopPizzaV
Varieties:RestaurantPen
netrationbyRestaurantSSegment,201
12...........................59
Daypartaanalysis:notjustfordinn
ner..................................................................................................................................60
Table59
9:Pizzaonth
heMenu:ResstaurantPeneetration,byD
Daypart,201
12.....................................................60
Butbreak
kfastpizzaexxperimentatiionabounds .............................................................................................................60
Butnotamonglargechains......................................................................................................................................................60
Table51
10:PizzaonttheBreakfasttMenu:SelectedExamples,2012..................................................................61
Pizzaheaalthmarketin
ngclaimsbarrelydentthemenu................................................................................................62
Anemicp
pizzahealthm
marketingtiees....................................................................................................................................62
Newfrozzenpizzaprroductintroductions.....................................................................................................63
Ju
une2012:DiGiorno,CPKan
ndTombstone........................................................................................................................63
M
May2012:Kash
hiFourCheesePizza.....................................................................................................................................64
April2012:Fro
ozenNakedPizza&BoldOrrganicsPizza..............................................................................................64
April2012:UdiisGlutenFreeeFrozenPizzaa......................................................................................................................65
M
March2012:A
AnniesOrganicRisingCrusttPizza..........................................................................................................65
Newofferings:pizzacrust........................................................................................................................................................66
PurchaseD
Decisionan
ndEatingEx
xperience......................
.
....67
Chapterr6:RestaurrantPizzaP
Introducttion...................................................................................................................................................................................68
PizzaOrd
deringInflu
uencers................................................................................................................................68
Pizzaattrributesareth
hestrongestdraw............................................................................................................................68
Butitsno
otjustabouttpizza.....................................................................................................................................................69
Graph61
1:PizzaOrdeeringInfluen
ncers:Rankin
ngScores,2012.............................................................................69
Gender: tiltmarketing
t
gmessagesttoemphasizeevalueandconvenience...........................................................70
Table61
1:PizzaOrdeeringInfluenccers:RankinggScores,byGender,2012......................................................70
Ageanaly
ysis:playupthecraving...........................
.
..............................................................................................................70
Table62
2:PizzaOrdeeringInfluenccers:RankinggScores,ByAge,2012..............................................................71
HHincom
meanalysis....................................................................................................................................................................71
iv
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ontents
Table63
3:PizzaOrdeeringInfluenccers:RankinggScores,HH
HIncome,201
12.....................................................71
Race/eth
hnicityanalyssis.............................................................................................................................................................72
Table64
4:PizzaOrdeeringInfluenccers:RankinggScores,ByRace/Ethniccity,2012......................................72
Restaura
antPizzaEa
atingRationa
ales...............................................................................................................72
Communityandshariing............................................................................................................................................................72
keting..................................................................................................73
Couponsusageopenssdoorsfortaargetedmark
utines............................................................................................................................73
Continuetotargetesttablishedrou
hedulesoverrtakeus,send
dpizzatotheerescue.............................................................................................73
Whensch
Graph62
2:Restauran
ntPizzaEatin
ngRationaless,2012................................................................................................74
Age:com
mmunityandssharing..................................................................................................................................................74
Table65
5:RestauranttPizzaEatinggRationales,,ByAge,201
12...............................................................................74
Income:rroutineandw
workinglate.......................................................................................................................................75
Table66
6:RestauranttPizzaEatinggRationales,,ByHHIncom
me,2012................................................................75
Kids:wheeredowestaart?..........................................................................................................................................................75
Table67
7:RestauranttPizzaEatinggRationales,,ByHHIncom
me,2012................................................................75
EatingPa
articipants,OverEating
g,Promotion
ns&Health
hyOptionAw
wareness................................76
Family&kidstrumpeeatingalone..........................
.
..............................................................................................................76
.
....................................................................................76
Satisfaction?Yes.Oveerindulgencee?Notreally..........................
ngasignificaantforce.................................................................................................................................................76
Couponin
Healthyo
options?Wheere?.........................................................................................................................................................76
Graph63
3:ConsumerrPizzaRestau
urantEatinggParticipantss,OverEating,Promotion
ns................................
&HeaalthyOptionA
Awareness,2
2012..............................................................................................................................77
Eatingpaarticipants......................................................................................................................................................................77
Gender:familydifferential.......................................................................................................................................................77
Table68
8:ConsumerPizzaRestau
urantEatingParticipants,ByGender,2012..............................................77
Age:timeewithchildrraisingyearss.......................................................................................................................................78
Table69
9:ConsumerPizzaRestau
urantEatingParticipants,ByAge,201
12.....................................................78
HHIncom
me:familyam
middleincom
mesweetspo
ot..........................................................................................................78
Table61
10:ConsumerPizzaRestaaurantEatinggParticipantts,ByHHIncome,2012...................................78
Race/eth
hnicity...............................................................................................................................................................................79
Table61
11:ConsumerPizzaRestaaurantEatinggParticipantts,ByRace/E
Ethnicity,201
12..........................79
Kids....................................................................................................................................................................................................79
12:ConsumerPizzaRestaaurantEatinggParticipantts,
Table61
ByPreesenceofChiildreninHH,,2012...........................................................................................................................79
Overeating,promotio
ons&healthy
yoptionawaareness...............................................................................................80
Gender...............................................................................................................................................................................................80
Table61
13:ConsumerPizzaRestaaurantEatingg:OverEatin
ng,Promotion
ns&Healthy
yOption
Awareeness,ByGen
nder,2012............................................................................................................................................80
Age.......................................................................................................................................................................................................80
Table61
ng,Promotion
ns..........................................................
&HeaalthyOptionA
Awareness,B
ByGender,2012.....................................................................................................80
HHincome.......................................................................................................................................................................................81
Table61
ng,Promotion
ns&Healthy
yOption
Awareeness,...............................................................................................................................................................................81
ByHHIncome,2012...................................................................................................................................................................81
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ontents
Chapterr7:Deliverryv.Pickup
p,Chainv.I
Independen
nt&MenuItemOrderring.................82
Introducction............................................................................................................................................................82
2.5timessmorepeop
plechoosed
deliverythan
ndiningin..........................................................................83
Table71
1:PizzaProcu
urement:Restaurantv.T
Takeout/Delivery,.........................................................................84
DemograaphicAssessm
ment,2012...........................................................................................................................................84
Moretakeout/deliverryusersinflu
uencedbyeaaseofpizzafactors....................................................................85
2:ConsumerRestaurantP
PizzaEatingRationales,b
byEatInv.T
Takeout/Deliivery,2012.........85
Table72
Pizzacha
ainsdomina
ate.........................................................................................................................................86
Table73
3:PizzaProcu
urement:MaajorPizzaChain,LocalInd
dependentP
PizzaRestaurrant,
NonP
PizzaRestaurrant,DemogrraphicAssesssment,2012...................................................................................86
Eatingon
nsitemorelikelyatlocalindependenttsandonpizzzarestauran
nts...................................................87
Table74
4:PizzaProcu
urement:MaajorPizzaChain,LocalInd
dependentP
PizzaRestaurrant&
NonP
PizzaRestaurrant,byEatIInv.Takeoutt/Delivery,2012...........................................................................87
So,whatdidyouordeeratthepizzarestaurantt?...........................................................................................................87
der.............................................................................87
Nonpizzaentres,inaggregate,ccontributestrronglytoord
Salad:theehealthyholldout.......................................................................................................................................................87
Drinks,please................................................................................................................................................................................87
1:FoodandD
DrinkOrdereedDuringLaastVisittoPizzaRestauraant,2012.......................................88
Graph71
Largerorrders:youngerpatrons............................................................................................................................................89
Table75
5:FoodandD
DrinkOrdereedDuringLasstVisittoPizzzaRestauraant,byAge,2012.......................89
HHIncome.......................................................................................................................................................................................90
Table76
6:FoodandD
DrinkOrdereedDuringLasstVisittoPizzzaRestauraant,
byHH
HIncome,201
12.............................................................................................................................................................90
Race/ethnicity................................................................................................................................................................................91
Table77
7:FoodandD
DrinkOrdereedDuringLasstVisittoPizzzaRestauraant,
byRacce/Ethnicity,,2012.....................................................................................................................................................91
M
Menuordering
:Eatingatresstaurantv.tak
keout/delivery
y..........................................................................................92
Table78
8:FoodandD
DrinkOrdereedDuringLasstVisittoPizzzaRestauraant,........................................................
byEattInv.Takeou
ut/Delivery,2012............................................................................................................................92
Chapterr8:PizzaUptakeMotiivators.................................................................................................93
Introducction............................................................................................................................................................93
Summary
yanalysis.......................................................................................................................................................................94
Healthierpizzaaneededtoinccreaseusage.........................................................................................................................94
Peersonalsize...................................................................................................................................................................................94
Onthegoconv
venience..............................................................................................................................................................94
Aninternationaal/ethnictwisst.................................................................................................................................................94
Butahardselltosome...............................................................................................................................................................94
Graph81
1:MotivatorstoEatPizzaaMoreOften
n,2012...............................................................................................95
Gender..............................................................................................................................................................................................95
1:MotivatorsstoEatPizzaaMoreOften,,byGender,2012........................................................................95
Table81
Age:expeerimentwith
hyouth....................................................................................................................................................96
Table82
2:MotivatorsstoEatPizzaaMoreOften,,byAge,201
12................................................................................96
HHIncom
me:healthhittshighernottes..................................................................................................................................96
Table83
3:MotivatorsstoEatPizzaaMoreOften,,byHHIncom
me,2012................................................................96
Race/eth
hnicity...............................................................................................................................................................................97
Table84
4:MotivatorsstoEatPizzaaMoreOften,,byRace/Eth
hnicity,2012
2........................................................97
Healthyffoods&homeecookedmeals:trendsontherise..........................................................................................97
Graph82
2:FoodConssumptionTreends:EatingMore,Same&Less.....................................................................97
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ontents
Significan
nteffectonp
pizzauptakemotivators.................................................................................................................98
M
Morehealthful
eatingtranslaatestohealthy
ypizzamotivaation..................................................................................98
Leesshealthyeaatingtranslateestopersonalsizeandonth
hegopizzamotivation............................................98
Table85
5:FoodConsu
More,Same&
&Less:.....................................................................98
MotivatorstoEatPizzzaMoreOfteen....................................................................................................................................98
Chapterr9:RetailP
PizzaManu
ufacturer,B
Brand&New
wProductAnalysis.............................99
Introducttion...................................................................................................................................................................................99
Summary
yanalysis.......................................................................................................................................................................99
NestlUSA........................................................................................................................................................................................99
Scchwan...........................................................................................................................................................................................100
GeneralMills................................................................................................................................................................................101
Frozenpiizzalongterrmtrend:possitive;shorttermtrend:n
negative...............................................................101
Table91
1:HHFrozen
nPizzaEatingg&EatingFrrequency,20062012..............................................................101
Brandusagetrendingg..............................................................................................................................................................102
DiGiornostrenggthensbrandleadership..........................................................................................................................102
Table92
2:HHFrozen
nPizzaBrand
dPenetration
nandEngageement,20062012..........................................102
NestlUS
SA,Inc......................................................................................................................................................103
Company
yOverview..................................................................................................................................................................103
Kraftacquisitionconssolidatespizzzasupremaccy.......................................................................................................103
Kingofpiizzasales....................................................................................................................................................................104
Su
uperpremium
mtakingabigggerhit.....................................................................................................................................104
DiGiornoremainsjew
welinthepizzacrown..................................................................................................................104
3:NestlFrozzenPizzaSalles,byBrand
dandLineExxtension,201
112012......................................105
Table93
Brandby
ybrand..........................................................................................................................................................................105
DiGiornoconsu
umerusagedrrivers.....................................................................................................................................106
yengagementtdrivenby1834s,blacks,aand<$50Khou
useholds...........................................106
Highfrequency
Table94
4:DiGiornoF
FrozenPizza:KeyUsersaandHighFrequencyUserrs....................................................106
Newofferings..............................................................................................................................................................................107
RecessionaidsDiGiornosfigghtwithpizzachains......................................................................................................107
nscrystalcleaar......................................................................................107
Advertisingmaakestargetingofpizzachain
orts......................................................................................................................................................................108
Goingafterspo
Tombston
ne...................................................................................................................................................................................108
Tombston
neconsumerrusagefound
dation.......................................................................................................................108
Highfrequency
yengagementtunderscoresimportanceoflowerincom
mes&blackcon
nsumers..............108
Table95
5:TombstoneeFrozenPizzzaUseandH
HighFrequen
ncyUse:KeyUsers..........................................109
Newofferrings.............................................................................................................................................................................110
SttouffersandS
StouffersLean
nCuisine..............................................................................................................................110
CaliforniaaPizzaKitch
hen:sufferinggfromneglecctorthereceession?..................................................................110
JacksPizzzavirtuallyu
unchanged........................................................................................................................................111
Usagepatternschangesignifficantlyaccord
dingtofrequeencyofuse...................................................................111
by1834s,hou
useholdswith
hkids,middleincomebrack
ket&region........111
Generalengageementdrivenb
yengagementtdispersedacrrossmanygro
oups................................................................................111
Highfrequency
Table96
6:JacksFrozzenPizzaUseeandHighFrrequencyUse:KeyUsers ......................................................112
TheSchw
wanFoodCo
ompany.............................................................................................................................113
Pizzacen
ntricity..........................................................................................................................................................................113
Table97
7:SchwanFrozenPizzaSales,byBran
ndandLineE
Extension,20
0112012...................................114
RedBaro
on....................................................................................................................................................................................114
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ontents
Freschettta....................................................................................................................................................................................115
Prromotions...................................................................................................................................................................................116
Tonys..............................................................................................................................................................................................116
ools.....................................................................................................................................................................116
LiiveSmartScho
VillaPrima....................................................................................................................................................................................116
GeneralMills.........................................................................................................................................................117
Totinos.........................................................................................................................................................................................117
Onthegoinno
ovation...............................................................................................................................................................117
Prromotionalacctivity.................................................................................................................................................................117
Chapterr10:PizzaR
RestauranttBrandAn
nalysis..........................................................................118
Introducttion................................................................................................................................................................................118
CaliforniiaPizzaKitcchen....................................................................................................................................118
Company
yoverview..................................................................................................................................................................118
Restaurantsnapshot...............................................................................................................................................................118
Menuoveerview..........................................................................................................................................................................118
Marketin
ng&brandacctivity...................................................................................................................................................119
Innovatio
onandactivity..........................................................................................................................................................119
Menuinn
novation.......................................................................................................................................................................119
Healthierintroductions..........................................................................................................................................................119
ortcake...................................................................................................................................120
NewdessertSttrawberrySho
nandGlutenFreeCrust...........................................................................................................................120
NaturalChicken
uttingwhatdo
oesntwork....................................................................................................................................................120
Cu
Table101:CaliforniaaPizzaKitcheenNewOfferrings:XXX.....................................................................................121
Promotio
onalactivity................................................................................................................................................................121
Faacebookfansggetathanky
you.........................................................................................................................................121
Giftcards........................................................................................................................................................................................121
dorelief...........................................................................................................................................................122
Alabamatornad
Technolo
ogyinnovatio
on...........................................................................................................................................................122
CPKattraactsMobileP
Professionalss....................................................................................................................................122
Graph10
01:CaliforniaaPizzaKitch
henUsageFreequencyMob
bileSegmenttationAnalyssis.......................123
TheCalifo
orniaPizzaK
KitchenConsumer.........................................................................................................................123
Keyconsu
umergroupss.............................................................................................................................................................123
Generalanyu
use.......................................................................................................................................................................123
ngagedusers.............................................................................................................................................................................123
En
Table102:CaliforniaaPizzaKitcheenEngagemeent:KeyUsers............................................................................124
20
quencyanalysiis:................................................................................................................125
CPKcusto
omerattitud
desaboutfood.................................................................................................................................125
Customerrsegmentatiionbyfoodliifestyle......................................................................................................................126
TrueFoodies................................................................................................................................................................................126
ButVarietyonaBudgetisnttfarbehind......................................................................................................................126
Graph10
02:CaliforniaaPizzaKitch
henUsageFreequencyFoo
odSegmentattionAnalysiss...........................126
DominosPizza.....................................................................................................................................................127
yoverview..................................................................................................................................................................127
Company
Menuoveerview..........................................................................................................................................................................127
Growthstrategy........................................................................................................................................................................127
onandactivity..........................................................................................................................................................127
Innovatio
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ontents
Menuinn
novation.......................................................................................................................................................................128
Higherqualityproductstimeedwithwellexxecutedprom
motions...........................................................................128
mulationpaysh
hugedividend
ds.................................................................................................................128
Prroductreform
Balancinglowpricepromotiionswithhigh
herqualityintroductions..................................................................128
upsellingamm
munition........................................................................128
ArtisanPizzapromisesqualiity;providesu
mmeetsUSDA
Aschoolnutriitioncriteria...................................129
DominosSmarrtSliceschoollunchprogram
Newmen
nuintroductiionanalysis.......................................................................................................................................129
Ontrendwithgglutenfree.......................................................................................................................................................129
Newpizzas,breeadsandsidessmakingtheirrwayontotheemenu..........................................................................129
Table105:DominossNewOfferin
ngs:Pizza.................................................................................................................129
Siidesandappsuptheflavorante.......................................................................................................................................130
Table106:DominossNewOfferin
ngs:Bread&Sides...............................................................................................130
Promotio
onalactivity................................................................................................................................................................130
GlobalDominosDaypromottion.........................................................................................................................................130
hopRunnerprromotion..........................................................................................................................................................130
Sh
Caarryoutpromotion.................................................................................................................................................................131
Cy
yberMonday.............................................................................................................................................................................131
Technolo
ogyinnovatio
on...........................................................................................................................................................131
iP
Phoneapppassses$1million
ninweeklysaales..............................................................................................................131
DominoslauncchAndroidap
pp.............................................................................................................................................131
Q
Q22012ontra
ackforgrowth
h................................................................................................................................................131
Customerrsegmentatiionbymobileedeviceinteraction...........................................................................................132
Astrongconneectiontohighly
yengagedmo
obilephoneussers.................................................................................132
Graph10
03:DominossUsageFreq
quencyMobilleSegmentattionAnalysiss.....................................................132
PU
ULSEgeneratingonlinesalees............................................................................................................................................132
Caallcenterbuilldsincrementaalsales..................................................................................................................................133
TheDominosConsum
mer.......................................................................................................................................................133
umergroupss.............................................................................................................................................................133
Keyconsu
Generalanyu
use.......................................................................................................................................................................133
ngagedusers::youthandno
onwhiteraciaal/ethnicgrou
upsdrivesaless............................................................133
En
Highlyengaged
dusers:HHinccomebecomeesmuchmoreimportant...................................................................134
Table107:DominossPizzaEngaggement:KeyUsers..............................................................................................134
2009201
12Guesttraffficfrequency
yanalysis................................................................................................................135
Table108:DominossGuestTraffiicTrends,20
0092012........................................................................................135
DominossdeliverstoHispanics...........................................................................................................................................135
Table109:DominossLocation&H
HispanicPop
pulationAnalysis.......................................................................136
But.................................................................................................................................................................................................136
Table1010:DominosHispanicG
GuestTrafficTrends,20092012.................................................................136
Graph10
04:DominossUsageFreq
quencyFoodSegmentatio
onAnalysis..........................................................137
Salesperformance....................................................................................................................................................................137
20
012onsolidffooting...............................................................................................................................................................138
Table1011:Dominos,SelectedM
Metrics,2007
711..................................................................................................138
LittleCae
esarsPizza.............................................................................................................................................139
Company
yoverview..................................................................................................................................................................139
Menuoveerview..........................................................................................................................................................................139
Brandstrrategy...........................................................................................................................................................................139
Marketin
P
Pizza!Pizza!rreturns.............................................................................................................................................................139
Newmen
Newvarietieso
ofCaesarWinggs............................................................................................................................................140
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ontents
Promotio
onalactivity................................................................................................................................................................140
$5
5HotNReady
ypizza..............................................................................................................................................................140
CrrazyBreaddu
uringbasketbaall............................................................................................................................................140
CrrazyBreaddu
uringfootball..................................................................................................................................................140
CrrazyBreadforrVeteransDay..............................................................................................................................................141
Giftcardmoves..........................................................................................................................................................................141
CaardRewardsw
withDiscoverrcard......................................................................................................................................141
Technolo
ogyinnovatio
on...........................................................................................................................................................141
iP
Phoneapp....................................................................................................................................................................................141
Buttheapphassitslimitation
ns..........................................................................................................................................141
Graph10
05:LittleCaeesarsUsageFrequencyM
MobileSegmeentationAnaalysis............................................142
TheLittleeCaesarsCo
onsumer..............................................................................................................................................142
Keyconsu
umergroupss.............................................................................................................................................................142
Generalanyu
use.......................................................................................................................................................................142
ngagedusers::............................................................................................................................................................................142
En
Highlyengaged
dusers:..............................................................................................................................................................143
Table1012:LittleCaaesarsEngaggement:KeyUsers..............................................................................................144
2008201
yanalysis:...............................................................................................................145
Table1013:LittleCaaesarsGuesttTrafficTren
nds,20082012...........................................................................145
6+
+visitsamon
nthattractsVaarietyonaBud
dget............................................................................................................145
Graph10
06:LittleCaeesarsUsageFrequencyF
FoodSegmen
ntationAnaly
ysis................................................146
CN
NNcallsLittleeCaesarsagoo
odfranchiseb
bet...............................................................................................................146
M
Merchandiseon
nitswebsite...................................................................................................................................................146
PapaJoh
hns.............................................................................................................................................................147
Company
yoverview..................................................................................................................................................................147
Restaurantsnapshot...............................................................................................................................................................147
Menuoveerview..........................................................................................................................................................................147
Brandstrrategy...........................................................................................................................................................................148
Brandingthatrreflectsquality
ypositioning......................................................................................................................148
Sttrategypayinggoff....................................................................................................................................................................148
Marketin
Lo
oyaltyandgifttcardprogram
ms...........................................................................................................................................149
Innovatio
onandactivity..........................................................................................................................................................149
Menuinn
novation.......................................................................................................................................................................150
Newmen
Ch
hickenParmeesanPizzaLTO
O...............................................................................................................................................150
BuffaloChicken
nPizzaLTO.....................................................................................................................................................150
CllassicSausagee&PeppersPiizzaLTO...............................................................................................................................150
Table1014:PapaJoh
hnsNewOffferings:XXX...........................
.
.................................................................................151
Piizzacombinattionsflexvaluepositioning.....................................................................................................................151
Promotio
onalactivity................................................................................................................................................................151
Advertisingmaatters..................................................................................................................................................................152
1040Specialfortaxdayprrocrustinatorrs..................................................................................................................152
1
RelationsshipwithNFL
L............................................................................................................................................................152
NFLandPepsi..............................................................................................................................................................................152
1MillionPizzaNFLGiveaway..............................................................................................................................................152
uperBowlXLV
VICoinTosslaandsonhead
ds...............................................................................................................153
Su
PaapaJohnsoffeeredfreepizzaifSuperBow
wlwentintoo
overtime........................................................................153
PaapaJohnsheaartshapedpizzza...........................................................................................................................................153
T
ToolsforTeaccher2011ColllectionDrive.....................................................................................................................153
Ceelebratesopen
ning3,000thN
NorthAmericanrestaurantt........................................................................................153
Technolo
ogyinnovatio
on...........................................................................................................................................................153
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ontents
Fiirstcompanytoreach$2biillioninonlineesales........................................................................................................154
PaapaJohnsturrnedtoRadwaareforfastdellivery.........................................................................................................154
AndroidandiP
Phoneappexplosion....................................................................................................................................154
yaltyprogram
m...............................................................................................................................................154
Onlinepizzaloy
M
Mixingpizzaw
ithpoliticsexposessocialm
mediadangerss........................................................................................154
Graph10
07:PapaJohnsUsageFreequencyMob
bileSegmenttationAnalyssis.................................................155
ThePapaaJohnsConsumer...................................................................................................................................................155
Keyconsu
umergroupss.............................................................................................................................................................156
Generalanyu
use.......................................................................................................................................................................156
ngagedusers::agereversal,racial/ethnicdisparity,solidlymiddlecllassandfamillydriven.............156
En
Highlyengaged
dusers:womeen?...........................................................................................................................................156
Table1016:PapaJoh
hnsEngagem
ment:KeyUsers...................................................................................................157
2008201
yanalysis:positivemomentum...................................................................157
Table1017:PapaJoh
hnsGuestTrrafficTrends,20092012................................................................................158
6+
+visitsamon
nthattractsVaarietyonaBud
dget............................................................................................................158
Graph10
08:PapaJohnsUsageFreequencyFoo
odSegmentattionAnalysiss.....................................................158
Saalesgrowthtrrendingupwarrd............................................................................................................................................159
Unitexpansion
ncontinues.......................................................................................................................................................159
nternationalgrowthoutpacesdomesticggrowth.......................................................................................................159
In
Table1018:PapaJoh
hns,Selected
dMetrics,200912..............................................................................................160
PapaMu
urphys......................................................................................................................................................161
Company
yoverview..................................................................................................................................................................161
Menuoveerview..........................................................................................................................................................................161
Innovatio
onandactivity..........................................................................................................................................................161
Menuinn
novation.......................................................................................................................................................................161
Newmen
M
MiniMurphMa
akenBakePizzzaKit...................................................................................................................................162
Table1019:PapaMu
urphysNewOfferings:XX
XX.....................................................................................................162
Table1020:PapaMu
urphysNewOfferings:XX
XX.....................................................................................................162
Promotio
onalactivity................................................................................................................................................................163
TaxDaySpeciaal...........................................................................................................................................................................163
Program...........................................................................................................................................................163
RelayForLifeP
Marketin
$3
35millionadcampaign........................................................................................................................................................163
TakeNGrillGiveaway............................................................................................................................................................163
umberjackPizzzaContest......................................................................................................................................................164
Lu
Technolo
ogyinnovatio
on...........................................................................................................................................................164
Ph
hizzlemobilemarketingrellationshipexttended.......................................................................................................164
Redemptionrateslookprom
mising......................................................................................................................................164
PrragmaticAdop
pters:engaged
duserswhov
valuebrandatttributes,notm
mobileconnecctivity....................164
Highlyengaged
dSocialConneectorsandMob
bileProfessionalsdifferenttiatebrand.......................................165
Graph10
09:PapaMurrphysUsageeFrequencyMobileSegm
mentationAnalysis..........................................165
ThePapaaMurphysConsumer............................................................................................................................................166
Generalanyu
use.......................................................................................................................................................................166
ngagedusers.............................................................................................................................................................................166
En
Highlyengaged
dusers...............................................................................................................................................................166
Table1021:PapaMu
urphysEngaagement:Key
yUsers.............................................................................................167
2008201
yanalysis................................................................................................................167
Table1022:PapaMu
uphysGuestTrafficTren
nds,20082012...........................................................................168
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ontents
Graph10
010:PapaMu
urphysUsaggeFrequency
yFoodLifesttyleSegmenttationAnalyssis........................169
FrranchiseDeals...........................................................................................................................................................................169
PizzaHu
ut.................................................................................................................................................................170
Menuoveerview..........................................................................................................................................................................170
Growthstrategy........................................................................................................................................................................170
Frranchisingmo
odelcontinuesstogathersteeam.............................................................................................................170
Innovatio
onandactivity..........................................................................................................................................................170
Su
uperBowlSun
ndayaBonanzza.............................................................................................................................................171
Menuinn
novation.......................................................................................................................................................................171
Newmen
nuintroductiion&promottionanalysiss..........................................................................................................171
PZolotakesaim
matsubs..........................................................................................................................................................171
Su
ubwayTakeov
verpromotion
ndriveshomeemessage.................................................................................................171
Piizzacrustsandbreadsmak
kingwayontomenu........................................................................................................171
UltimateCheesseLoversPizzzaDeal...................................................................................................................................172
UltimateStuffedCrustPizza.................................................................................................................................................172
heesyBitesin
ntroductiongeetsasupportin
ngcastofcharracters...........................................................................172
Ch
Table1023:PizzaHu
utNewOfferings:Pizza,SSandwichesaandBread............................................................173
Sp
preadingthew
wealthwithfaamilydeals..........................................................................................................................173
BigDinnerBoxxpromotionan
ndRedRoofW
Wednesday..............................................................................................173
n..........................................................................................................................................................................173
GameStoptiein
10AnyPizzaD
Deal....................................................................................................................................................................174
$1
Table1024:PizzaHu
utNewOfferings:FamilyMeals&$10
0Deals...................................................................174
Promotio
onalactivity................................................................................................................................................................174
TimTebowparrtneredwithB
BOOKIT!..............................................................................................................................174
PZonePromotion......................................................................................................................................................................174
PiizzaHutPartn
nerswithZynggatoBenefitH
HungerRelief.........................................................................................175
Technolo
ogyinnovatio
on...........................................................................................................................................................175
PiizzaHutofferssmobileorderingapps.............................................................................................................................175
DrawingfromM
MobileGeneraationandSociialConnectorss.......................................................................................175
Graph10
011:[Compaany]UsageFrrequencyMo
obileSegmen
ntationAnaly
ysis...............................................176
ThePizzaaHutConsum
mer.......................................................................................................................................................176
Keyconsu
umergroupss.............................................................................................................................................................176
Generalanyu
use:youth,reggion,andrace.....................................................................................................................176
ngagedusers::youth,region
n,andrace...........................................................................................................................176
En
Highlyengaged
dusers:HHinccomeaddsattwist...........................................................................................................176
Table1025:PizzaHu
utEngagemeent:KeyUserrs........................................................................................................177
2008201
yanalysis................................................................................................................178
Table1026:PizzaHu
utGuestTraffficTrends,2
20082012.....................................................................................178
En
ngagedusers.............................................................................................................................................................................178
Highlyengaged
dusers...............................................................................................................................................................178
Graph10
012:PizzaHutUsageFreequencyFood
dSegmentatiionAnalysis..........................
.
.............................179
dix.................................................................................................................................................180
Append
Methodollogy...............................................................................................................................................................................180
Co
onsumersurv
veymethodolo
ogy..........................................................................................................................................180
M
Marketsizeand
dforecast.........................................................................................................................................................180
Retailpizzamaanufactureran
ndbrandsaless....................................................................................................................181
M
Menuitemtren
ndanalysis.......................................................................................................................................................181
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ontents
Reporttaableinterpretation..................................................................................................................................................181
Consumeerengagemen
nt...........................................................................................................................................................182
Piizzarestauran
nts.......................................................................................................................................................................182
Frrozenpizza.................................................................................................................................................................................182
Terms&definitions.................................................................................................................................................................183
Su
upermarkets..............................................................................................................................................................................183
Restaurantcateegories..............................................................................................................................................................183
definitions............................................................................................................................183
Liimitedserviceerestaurantd
Fu
ullserviceresstaurantdefin
nitions....................................................................................................................................185
Otherdefinition
ns........................................................................................................................................................................186
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Pizza at Foo
R
Executive Sum
mmary
Chapter1:EExecutiveSu
ummary
DUCTION
INTROD
Our Execcutive Summ
mary provide
es a concise
e overview of
o industry and consume
er trends sha
aping
the markket for retail pizza and re
estaurant pizza, giving readers
r
efficcient insight into themess and
topics takken up in gre
eater detail (and
(
heavilyy supported by
b graphs and
a tables) in
n the report..
dology
ScopeandMethod
ReportScope
a consumeer trends shhaping the U.S.
U
pizza market.
m
Scoppe of
This report analyzess industry and
r
with an
a emphasis on frozen pizza;
p
and at restaurants, with
analysis includes pizzza solid at retail,
fu
a limited-sservice estabblishments.
and
an emphaasis on the full-service
Our U.S. pizza resttaurant markket size andd forecast iss segmentedd by sales at
a 1) full-seervice
restaurannts and 2) lim
mited-service eating placces. Our U.S
S. retail pizzza market sizze and foreccast is
segmenteed by sales of 1) frozenn pizza and 2) refrigeratted pizza (eaach at groceery/supermarrkets,
mass merrchandisers, drug stores,, supercenterrs, dollar stoores, club stoores and speccialty stores)).
FDMx (ffood, drug, and
a mass meerchandiserss other than Walmart) reetail manufaacturer and brand
b
sales in this
t
report is based on dollar sales during the 52-week period ending July 8, 20112, as
compiledd by the InffoScan Reviiew service of SymphonyIRI, whicch tracks saales through U.S.
supermarrkets and grocery storees, drugstorees and masss merchanddisers (incluuding Targett and
Kmart, but
b excludin
ng Walmartt) with annuual sales off $2 millionn or more. This analyssis is
compriseed of three seegments: froozen pizza, refrigerated pizza,
p
and piizza products, as well as their
respectivve sub-segmeents.
Reportre
esourcesum
mmary
This repoort includes extensive annalysis of coonsumer dem
mographics, attitudes annd behaviorss as it
relates too the pizza industry, as
a derived from
f
the 20007, 2008, 2009,
2
2010, 2011 and 2012
Experiann Simmons National
N
Connsumer Survveys. For 20012, both Winter
W
and Sppring editionns are
referenceed. The repo
ort also incluudes extensivve and excluusive analysiis of Packagged Facts Auugust
2012 prooprietary 2,00
00 respondent pizza survvey commisssioned excluusively for thhe report.
Please seee the Appeendix for addditional infformation onn sources, definitions,
d
m
methodology
y and
interpretiive graphics guidance.
Septemberr 2012
1
Pizza at Foo
R
Executive Sum
mmary
Reportsummary
MarkettSizeandSSegmentattion:PizzaatFoodse
erviceandRetail
Packagedd Facts foreccasts sales at
a U.S. pizzaa restaurants to reach $336.1 billion in
i 2012, up 3.8%
from 20111. We foreccast U.S. pizzza restauraant 2011-20014 compou
und annual growth of 3.3%.
3
In 2012, we expect U.S. frozenn and refrigeerated pizzaa sales to reggister sales of $4.91 biillion,
down 0.99% from 201
11. We foreccast U.S. froozen and reefrigerated pizza 2011--2014 compoound
annual growth
g
of -0
0.1%. These estimates arre unadjustedd for inflatioon.
Summarryanalysis
Therestaaurantside
In 2012, we expect the
t limited-sservice eatinng places to generate $266.2 billion, or
o 78.5% off U.S.
pizza resstaurant salees, with full-service restaurants gennerating 22.55%. Riding a post-receession
return to full-service dining, full-service pizzza restaurantt sales will outpace
o
limited-service sales,
s
with a 20011-2014 CA
AGR of 5.2%
% versus 2.8%.
While piizza restauraants may bee losing shaare to other restaurant cuisine
c
form
mats, major pizza
chains haave continueed to grow sales: the toop 10 chainss by system
mwide sales grew
g
revenuue by
8.8% durring 2009-20
011 and by 3.3% duringg 2010-20111. However, sales growtth is weighteed by
size: fourr of the top five chains (Pizza Hut, Domino's Pizza,
P
Little Caesars andd Papa Murpphy's)
grew salees by at leastt 10% duringg 2009-20111. Third-placce Papa Johnn's grew salees by 6.4%.
Theretaiilside
In 2012, we expect frozen
f
pizzaa sales to reaach $4.58 biillion, or 93.2% of com
mbined sales, with
r
refrigeratted pizza generating $3330 millionn, or 6.8%. However, refrigerated
pizza saless will
outpace those
t
of frozzen pizza, wiith a 2011-20014 CAGR of
o 2.0% verssus -0.2%.
Private label
l
contin
nues to grow
w salesan
nd steal shaarein eachh of three FD
DMx retail pizza
segmentss (frozen pizzza, pizza prroducts, and refrigeratedd pizza), andd it grew its frozen pizzaa and
refrigeratted pizza sales share. Prrivate label now commaands a 13.3%
% share of retail
r
pizza sales.
s
This reprresents a 1.4 percentage point share increase,
i
on the heels off 9% sales grrowth.
m the bottoom: Amongg the top 12 frozen pizza
Categoryy growth is bubblingg up from
manufactturers, signiificant grow
wth came onnly from booutique comppanies New
wmans Ownn and
Amys Kitchen,
K
with 37% andd 10% salees growth, respectivelyy. Sales am
mong the toop 12
manufactturers declin
ned 3.1% foor the year ending
e
July 8, 2012. Excluding private label, sales
among thhe remaining
g top 14 braands declineed by 5.3%. Among thee top 10, only Totinos grew
sales by at
a least 1% (3.2%).
(
Septemberr 2012
2
Pizza at Foo
R
Executive Sum
mmary
Nestl USA
U
domin
nates the pizzza categoryy with its DiGiorno,
D
T
Tombstone,
California Pizza
P
Kitchen, and Jacks Original braands. When added to itss Stouffers brand pizzas, the acquissition
has catappulted Nestl USA to thhe top of the category, with
w $1.38 biillion in salees, a 45.4% share
of SymphhonyIRI-traccked sales
about 26 peercentage pooints ahead of
o No. 2 Schhwan Food ($595
(
million and
a
19.5% share)buut down 1.00 percentage points froom the yeaar-earlier peeriod.
Schwans share of saales dipped 2.3
2 percentagge points.
While challenges exist,
e
some (new) bran
nds and lin
ne extension
ns are buccking the trrend,
includingg the Fresceh
htta Simply Inspired linee extension, Totinos Piizza Stufferss, and Dr. Oeetker.
With an average unit retail pricee of $3.17, frozen
f
pizzass are well within
w
the reaach of houseehold
budgets. However, as
a illustratedd by wide prricing differrences amonng the fastest growing frrozen
pizza braands and lin
ne extensionns, consumeers will suppport the groowth of valuue and prem
mium
offeringss.
PizzaUssebyChan
nnel&Typ
pe
In this seection, we assess
a
usage penetration, usage freqquency, and usage share among 10 pizza
procurem
ment sourcess/types: Resttaurant delivvery/pick up;; restaurant dine in; buyy frozen; Maake at
home froom scratch or
o kit/mix; buy
b fresh/reffrigerated; get
g ready-too-eat from a non-restauurant;
get from at a sportin
ng/entertainm
ment event; get
g at a com
mpany cafeteeria/foodservvice program
m; get
at a colleege cafeteria//foodservicee program; or get from a food truck.
Summarryanalysis
Some 977% of respo
ondents eat pizza andd about 93%
% of responddents have gotten
g
food//drink
from a piizza restauraant in the paast 12 monthhs, levels of penetration that at once show how many
m
people ennjoy pizza and
a suggest difficulty in growing a commoditized market in the faace of
healthy eating
e
head
dwinds.
Howeverr, they obtaiin it from various
v
sourcces (i.e. resttaurants, foood retailers, sporting evvents,
etc.) andd in various forms (i.e. hot,
h frozen, and fresh/reefrigerated). We boiledd this down to 10
choices: Restaurant delivery/pick
d
k up; restaurrant dine in; buy frozen;; Make at hoome from sccratch
or kit/miix; buy unccooked (freesh/refrigeraated); get rready-to-eat from a noon-restaurantt; get
from at a sporting/en
ntertainmentt event; get at
a a companyy cafeteria/ffoodservice program;
p
geet at a
college cafeteria/food
c
dservice proogram; or gett from a foodd truck.
Among these
t
choicees, restauraant deliveryy is the sou
urce chosen
n in the lasst month byy the
highest percentage
p
of consumers, 27%, whhich translattes to roughly 66 million
n adults agee 18+.
At 26%, eating pizzaa at a restaurant is also a popular chooice (63 milliion customeers).
p
month, on averagee, adult connsumers got pizza 1.75 times via takeout/deliivery.
In the past
Extrapolaating from survey resuults and weaaving in poopulation esttimates, thiss equates too 410
million pizzasa
p
30
0% share off pizzas proccured via means covereed by our lisst. Frozen pizza,
p
which ad
dult consum
mers got a mean 1.43 times in th
he past mon
nth, generattes a 24% pizza
p
procurem
ment share..
Septemberr 2012
3
Pizza at Foo
R
Executive Sum
mmary
Women are more lik

kely than meen to have bought
b
pizzaa frozen or made
m
it at hoome from sccratch
or a kit/m
mix, tilting th
hem toward home-basedd pizza use.
Pizza proocurement in
i any of itts various forms
fo
is moore likely among
a
youn
nger consum
mers.
Howeverr, this tendeency becomees more proonounced as the procureement methhod becomess less
widely used
u
(at sporrting events, for examplee, or collegee cafeteria/fooodservice programs
p
or from
food truccks).
Kids heaavily influen
nce family dining
d
choicces: Adults with
w childrenn in the hom
me are more likely
l
to get pizzza from each listed souurce, exceptt for frozen pizza
p
and piizza takeoutt/delivery. Adults
A
with kidss at home aree get pizza from
fr
each source more frrequently.
FoodCo
onsumptio
on&MigraationTrend
ds:PlacinggPizzainC
Context
To proviide guidancee pizza-relatted consumpption trends within the context of other foods//food
types, Paackaged Factts analyzes consumption
c
n trends in 17
1 foods/foood types, inccluding restaaurant
pizza, froozen pizza, fresh/refriger
f
rated pizza, healthy foodd, home coooked meals, snacks,
s
leftoovers,
beef, Hisspanic/Latino foods, fishh/seafood, chicken,
c
smaall portions, on-the-go foods,
f
foods with
less fat, foods
f
with natural
n
ingreddients, otherr restaurant food,
f
and preepared food.
Summarryanalysis
Our surrvey results suggest a clear
c
food consumptio
c
on trend tow
ward health
hier optionss and
home-baased cost sav
vings, at thee expense of pizza: Witth respect too the 17 foodds and food types
we askedd about, con
nsumers are most likely to be eatinng more off those with stronger geeneral
health attributes
a
an
nd with hoome-based cost
c
savingss. Unfortunnately for pizza
p
purveeyors,
consumers are less likely to be eating
e
more pizza, whetther its restaaurant pizza,, frozen pizzza, or
fresh/refrrigerated pizzza.
The messsage to pizzza purveyoors is clear: enhance the overall heealthfulness of your pizzza, at
least incrrementally, and
a experim
ment with opttions providding more cleear-cut healtthfulness wiithout
sacrificinng taste.
We foun
nd that a neet positive 28%
2
of resp
pondents arre eating more
m
healthyy food over the
past few
w years. Fo
oods with heealthier proffiles (such as
a chicken, food
f
with leess fat, food with
natural inngredients, and
a small poortions) also have a posittive net diffferential. Restaurant
R
p
pizza,
frozen pizza
p
and frresh/refrigeerated pizzaa, on the otther hand, each receivve negative net
differenttials, with a net percenntage of the population
p
e
eating
less reestaurant pizzza, frozen pizza,
p
and freshh/refrigerated
d pizza.
Only 4 of 27 listed demographic
d
groups are eating more restaurantt pizza than they were aa few
years agoo: 18-24s, 25-34s,
2
studdents, and coonsumers wiith kids in thhe householdd. Unfortunaately,
the tendeency among these groups to eat moree pizza is deefined by theeir respectivee lifestyle sttages;
once theese consumeers pass thesse life stagees, they willl likely eat less pizza. The question is
whether notable grou
ups pulling back on resstaurant pizzza use (i.e. black and white
w
consum
mers,
suburbann consumers,, and womenn) can be entticed to reveerse the trendd.
As for froozen pizza, the
t situationn is more dirre: Not one of
o 27 demoggraphic groupps listed is eating
e
Septemberr 2012
4
Pizza at Foo
R
Executive Sum
mmary
more froozen pizza th

han they weere a few years
y
ago. Those
T
least apt
a to do so include midd- toupper-inccome consum
mers, womeen, consumeers with no kids
k
in the home, Asiann consumerss and
white connsumers. Th
he central isssue here, in our
o view, conncerns pizzaa healthfulneess. Women,, who
are more health-consscious than men
m and are more often the ones stoocking the kiitchen pantryy, are
probablyy gravitating to choices thhey perceivee as healthierr for themselves and/or for
f their fam
milies.
Those wiith higher in
ncomes are also generallyy more healtth aware, andd they are inn a better possition
to pay more for foods that deliveer on quality,, taste and heealthfulness..
On a net basis, not one of 27 dem
mographic groups
g
listedd is eating more fresh/reefrigerated pizza
p
than theyy were a feew years aggo. Howeveer, a silver liining of sorrts exists. Reesearch from
m our
other repports show th
hat higher-inncome and urrban consum
mers are morre apt to eat fresh/refrige
f
erated
pizza. On a net bassis, $100K+ HH incom
me consumerrs and urbann consumers are eatingg less
fresh/refrrigerated pizzza; howeveer, the net diifferentials (-9
( and -10, respectivelyy) are amonng the
smallest of all demog
graphics listeed.
Pizzaon
ntheMenu:MenuTTrendAnallysis
In this seection, Pack
kaged Facts assesses
a
pizzza menu treends, focusinng on menu item penetrration
and mennu item incid
dence by reestaurant seggment, incluuding top prroteins, ingrredients, cheeeses,
sauces, varieties,
v
kid
ds menus, annd health maarketing claims. Menu ittem data is provided
p
couurtesy
of Datasssential, a leaading food reesearch comppany.
Summarryanalysis
Pizzas popularity
p
iss underscoreed by its preevalence on U.S. restauurant menus,, with more than
one-thirdd of them feaaturing pizza as an entre on the menu, including 1 in 5 finne dining menus.
m
Howeverr, overall, pizza is loosening its hoold on the restaurant
r
m
menu,
with menu
m
penetrration
falling byy 4% from 2008 to 2012. But mennu trends reeveal a wealth of cuisinne-driven grrowth
opportunnity:
Push moore mileage out of fusioon cuisine. Pizza
P
shows up on a signnificant portiion of restauurants
featuringg a variety of
o cuisines, including almost
a
1 inn 4 Mediterrranean conccepts and 1 in 6
Mexican concepts. Pizza
P
is an iddeal fusion food,
f
as it caan draw from
m various cuuisines whilee still
b drawing from
f
its basicc parts: crustt, sauce, andd/or toppingss.
maintaining its generral identity by
Use pizza to mainstream a wider variety of
o leaner prooteins. The most
m prevaleent pizza prooteins
are overw
whelmingly associated with
w traditionand highh-fat contentt: sausage, pepperoni,
p
bacon,
ham, Itallian sausage,, meatball annd salami (seeven of the most
m prevaleent 10 pizza proteins feaatured
on pizza entres) aree not exactlyy embraced for
f health. Room
R
exists to bring leaaner proteinss into
the mix.
Septemberr 2012
5
Pizza at Foo
R
Executive Sum
mmary
Leverage vegetablee variety an

nd consumer acceptan
nce. A slew
w of vegetabble toppings are
availablee at 10% or more
m
of resttaurants servving pizza enntres, ranging from the more ubiquuitous
olives (aat 69%) to broccoli
b
(300%) and aruugula (10%)), demonstraating strong mainstream
m and
niche apppeal. As an inherently
i
heealthy food, vegetables provide
p
an ideal
i
vehiclee for purveyoors to
ratchet up
u pizzas health
h
profiile while caatering to consumers
c
needs while not havinng to
aggressivvely sell th
he concept to
t consumeers, who alrready orderr pizzas witth vegetablees in
abundancce.
Cheese = sophistica
ation. Cheeses once not strongly asssociated withh pizzafroom feta to gooat to
gouda to asiagoaree now strongg niche playyers across reestaurant seggments. Theese can be fuurther
leveragedd to tap international/ethhnic trends, fusion cuisinne trends, annd the aura of
o sophisticaation,
opening up
u new mark
ket potentiall.
Sauce exxperimentattion. Most of
o the moree prevalent sauces
s
have been in thee mainstream
m for
some tim
me: Pesto, co
onsidered noovel 25 yearss ago, is offeered as a pizzza sauce byy 27% restauurants
serving pizza
p
entrees. Most otther sauces have been borrowed by other poopular dishees or
concepts: Alfredo fro
om Italian pasta;
p
balsam
mic; ranch annd Caesar frrom salads; and BBQ. While
W
innovatioon within eaach of these sauce types is highly likkely, pizza could
c
also usse a boost frrom a
sauce or two made more
m
substanttively from whole
w
cloth..
Breakfasst daypart provides
p
on
n-the-go innovation pottential. Pizzaa is on only 5% of restaaurant
breakfastt menus. Butt the low pennetration of pizza on thee breakfast menu
m
belies the
t strong deegree
of pizza innovation
i
geared
g
towarrd this daypaart, albeit byy adhering laargely to the breakfast buurrito
playbookk. This takess on portabiliity issues, which
w
we view
w as a potenntial growth engine, but room
exists forr crossing otther on-the-ggo concepts with
w breakfaast pizza.
he health marketing
m
baar. While health
h
claims are often woven into menus, pizzza is
Raise th
simply noot positioned
d with the health-drivenn terminologyy: only 2.3%
% of restauraants serving pizza
as an enntre associaate pizza with
w
gluten free on thhe menu; low
fat annd organic are

associateed with onlly 1.9% andd 1.1%. Thhis minisculle degree of
o penetratioon suggestss that
restaurannt operators can
c experim
ment more wiith healthful claims that resonate
r
witth pizza eaterrs.
RestaurrantPizzaPurchaseD
DecisionandEatingExperiencce
In this seection of th
he report, as part of a thhree-questioon set analyssis, Packageed Facts asssesses
factors driving
d
the restaurant pizza purchase decision, includinng (ranked)) pizza orddering
influenceers; restauran
nt pizza eatiing rationalees; choice of eating partticipants; ovver eating, use
u of
promotioons; and heallthy option awareness.
a
Summarryanalysis
Among restaurant
r
piizza users, pizza
p
is natuurally the puurchase draw
w: consumeers most stroongly
agreed thhat topping
gs and cruust influennced their decision
d
to get
g food/drinnk from a pizza
p
restaurannt (each receeived a 4.4 on
o a ranking scale). Butt they rank non-pizza
n
m
menu
items at
a 3.9,
calling for
f industry
y participan
nts to contin
nue develop
ping non-pizzza items too grow saless and
diversifyy away from their bread and
a butter.
Septemberr 2012
6
Pizza at Foo
R
Executive Sum
mmary
The conccept of com

mmunity and
d sharing iss writ large on consum
mers interacction with pizza,
p
. The
and shou
uld be leverraged in maarketing meessages and
d serving/prreparation innovations
i
last time they ate pizzza from a restaurant, allmost half of restaurant pizza eaterss got it becauuse it
was an easy
e
choice to
t agree on with others, while more than a thirrd got it beccause its eaasy to
share witth others. Sim
milarly, alm
most 1 in 10 got
g pizza beecause they had
h companyy over, and more
than 4 inn 10 got pizzza because thhey wanted something easy
e
to servee. Communiity and shariing is
especiallyy relevant to
o younger coonsumers.
Coupon usage open
ns doors forr targeted marketing.
m
C
Coupons
aree a factor in 1 of 5 restaaurant
derscoring both
b
the breaadth of prom
motional acttivity and itss acceptancee and
pizza purrchases, und
use. Whiile the indusstry should naturally
n
be wary of siggnificant disccounting, established cooupon
use can provide
p
a stro
ong foundatiion for targeeting marketiing, providinng added usaage incentive and
a volumee-driven coun
nterweight to
t lower pricce-per-unit saales.
With pizzza such a un
niversally acccepted, higgher-volume food choicee, its not suurprising thatt it is
woven in
nto consumers lifestyles and routtines, whichh the industryy should con
ntinue to taarget.
Having a routine pizzza night is a rationale for getting pizza from a restaurannt among 2 in
i 10
restaurannt pizza eaterrs. TV Nigght was a purchase
p
factor for 7%. This is espeecially relevaant to
25-44s annd $100K+ HH
H income consumers.
When scchedules oveertake us, seend pizza too the rescue. Almost 2 inn 10 got pizzza because it
i was
too late to
t cook, possitioning pizza as a go-to food choicce when schhedules run amok
a
or coooking
becomes less feasiblle. In a simiilar vein, 7%
% of restaurrant pizza eaaters got pizzza because they
worked late. This is especially
e
reelevant to $100K+ HH inncome consuumers.
Children
n influence a variety of pizza pu
urchase rattionales, whhich should be leverageed by
marketinng messages targeting faamilies. Moreover, the laast time theyy ate pizza from
f
a restauurant,
7 in 10 restaurant pizza
p
users ate with fam
mily (2 in 10 ate withh kids and 2 in 10 ate with
teenagerss). Only 1 in
n 10 ate pizzza alone, unnderscoring concern th
hat pizza pu
urveyors aree not
capturin
ng orders frrom people wishing to feed only th
hemselves. Family marrketing messsages
may resoonate most am
mong womeen, 25-44s, middle-incom
m
me, and (of course)
c
famillies.
With resppect to theirr most recennt pizza eatinng experiencce, just overr one half off restaurant pizza
users werre very satissfied with thheir meal, annd about one-third reportting feeling full.
And while
w
pizza is noted
n
for itss indulgent qualities,
q
onlly 13% saidd they ate tooo much pizzza and only 11%
overindu
ulged. Even
n fewer5%
%felt bloatted. But onlly 1 in 10 restaurant
r
p
pizza
eaterss say
that heaalthy pizza options
o
werre available, suggestingg that the resstaurant pizzza industry is
i not
doing enoough to prom
mote or deveelop healthieer options.
Deliveryyv.Pickup
p,Chainv.Independ
dent&Men
nuItemOrdering
In this section
s
of th
he report, Packaged
P
Faacts assessess the degree to which restaurant pizza
customerrs use deliveery/pickup versus dine inn; and choosse pizza chaains versus inndependent pizza
restaurannts and non-p
pizza restaurrants. We alsso analyze what
w they ordder, and how
w delivery/piickup
versus diine in affectss the order.
Septemberr 2012
7
Pizza at Foo
R
Executive Sum
mmary
Summarryanalysis
While reestaurant pizza has it challenges, itss strong deliivery/pick up
u positioniing enables it to
competee well again
nst home-baased optionss, as well ass other off-ppremises loccations, incluuding
the workkplace, otherr peoples homes,
h
and special
s
evennts: The lastt time they ate pizza frrom a
restaurannt, 7 in 10 ussed takeout or
o delivery, while
w
3 in 100 consumers ate at the reestaurant.
For man
ny consumeers, pizza iss easy: Thhe last time they ate piizza from a restaurant, some
43% of consumers
c
go
ot pizza because they wanted sometthing easy too serve, and more
m
than a third
got becauuse its easy to share witth others. Hoowever, consumers who picked up thhe pizza or had
h it
deliveredd are more ap
pt to value pizzas
p
ease of
o service annd sharing.
Pizza ch
hains have a firm grip on
o the restaaurant pizzaa landscape. The last tim
me they ate pizza
from a reestaurant, 75
5% of consuumers got it from a major pizza chaain, while 244% got it frrom a
local, inddependent pizza restauraant. Only 2%
2 got pizzaa from a noon-pizza reestaurant (a QSR,
Q
family orr upscale resstaurant that does not sppecialize in pizza).
p
Howeever, local inndependent pizza
restaurannts are more likely choicces for pizza eaters who dine
d in than for those whho use pick up or
delivery.
r
pizza is thee draw: the last
l time theey got food and/or
a
drink from
Naturallyy, at pizza restaurants,
a pizza reestaurant, 95
5% of consuumers got pizzza. While pizza
p
restaurrant operatorrs often provvide a
choice off other entreees (from paasta to chickken to ribs), each non-ppizza entre listed below
w was
chosen by
b less than 2 in 10 cusstomers. Passta, chosen by
b 16% of customers,
c
is the most likely
l
non-pizza choice, folllowed by chhicken entree, and sandw
wich.
o less health
hy choices, salad
s
differeentiates itseelf as a healtthy option. Its presencee does
In a sea of
not go unnnoticed: am
mong listed non-pizza
n
foood options, salad
s
was thee most prevaalent choice,, with
one-thirdd of customeers ordering a salad the laast time theyy got food/drrink from a pizza
p
restaurrant.
hot in the arrm to restau
urant margiins. So, for pizza
p
restaurrants,
Beverages provide a needed sh
the fact that
t
under half of custom
mers orderedd a non-alcooholic drink is not the best
b news. Thhis is
partially due to th
he lower prevalence of
o beveragee ordering among thoose who chhoose
delivery//pickup. In the wake of other restaurants benefitting from highher-priced, more
sophisticcated, and/or higher-quallity beveragees, pizza resttaurants shouuld be follow
wing suit.
While deelivery/picku
up has helped pizza grow
w sales beyoond the estabblishment, thhe bill per peerson
is likely much higheer when dinning. Diningg in translaates to an average
a
ord
der of 3.5 ittems,
versus 2.7 for takeo
out and delivery. It alsso correlates to a greaterr propensityy to order a listed
l
food item
ms and drink
ks. The flipsside is that the industryy can continuue to learn how to grow
w the
delivery basket acco
ordingly. Whhile couponiing is alreaddy a well-enttrenched inddustry tool, pizza
purveyorrs can expeeriment withh targeted marketing
m
thhat matchess promotionns for addittional
purchasees to previous dining histtory or statisstically generrated food ordering assuumptions.
PizzaUp
ptakeMottivators
a
whaat would mootivate consuumers to eat more
In this seection of the report, Packkaged Facts assesses
pizza, focusing on fiive possibilitties: healthieer pizza, perrsonal size pizza,
p
more options I caan eat
Septemberr 2012
8
Pizza at Foo
R
Executive Sum
mmary
on the goo, internation

nal/ethnic pizzza options, or more gluutenfree pizzza options.
Summaryy analysis
Summarryanalysis
Healthieer pizza neeeded to inccrease usagge. Health may
m not be a dirty woord for the pizza
industry, especially if
i it wants too grow sales:: Some 4 in 10 consumerrs say healthhier pizza opptions
would enntice them to
o eat pizza more often. Demonstratting the nichhe importannce of glutenn-free
pizza, 7%
% of pizza eaaters would eat pizza moore often if there
t
were more
m
gluten-ffree options.. This
may resoonate especiially well among
a
wom
men, 18-34s, $75K+ HH
H income consumers, Asian
A
consumers and Hispaanic consum
mers.
Personall sizing a draw. Another 25% say personal sizze pizzas woould do the trick, suggeesting
interest in
i controllin
ng portion size and foodd waste, as well
w meetingg the needs of those whho eat
pizza aloone. This may
y resonate especially weell among 188-34s and <$$25K HH inccome consum
mers.
ns. The desirre for on-thee-go food opptions translaates to increasing
On-the-ggo convenieence beckon
pizza salles potential, at least wiith respect too the 20% of
o consumers who would eat pizza more
often if more on-thee-go options were avaiilable. Whiile pizza byy the slice is
i definitelyy less
cumbersoome than the traditionall small, meddium or largge sized pizzza, the pizzaa crust provides a
strong fooundation forr on-the-go experimentaation, be in the
t form of wraps,
w
burrittos, rolls or other
permutattions. This may resonaate especiallly well among men, 18-34s,
1
<$225K HH inccome
consumers, black con
nsumers andd Asian consumers.
An inteernational/eethnic twisst worth pursuit.
p
O
Only
12% of pizza eaters say that
internatioonal/ethnic pizza
p
optionns would mootivate them
m to eat pizzza more ofteen. Howeverr, this
may be due
d to consu
umers perceeption of pizza as a tradiitional food with longstaanding and stable
s
ingrediennt and prepaaration qualitties. Introduucing consum
mers to ingreedient and preparation
p
s
styles
found acrross the worrld may yieldd unexpected benefits. This
T may ressonate especcially well am
mong
men, 18-34s, $100K+
+ HH incom
me consumerss, and non-w
white consum
mers.
a uptake is a hard sell to
t some. Moore than 1 inn 4 consumerrs are nonpluussed
But increasing pizza
o
sayiing that nonne of them would
w
motivvate them too eat more pizza.
p
about anny of these options,
With pizzza use and pizza restaaurant use nearly
n
univerrsal, this is quite underrstandable: some
people have
h
enough pizza. The key involvees giving coonsumersbboth those who
w say they are
open to thhese usage motivators
m
annd those whho say they are
a notsom
mething new..
Healthy food & ho
ome cooked meals tren
nd translatess to increaseed motivatioon to eat heealthy
pizza andd internation
nal/ethnic pizzza. Those eating
e
less heealthy food and
a less hom
me cooked meals,
m
on the otther hand, arre more apt to be motivated to eat more
m
pizza with
w personaal size pizzas and
on-the-goo options.
RetailP
PizzaManu
ufacturer,Brand&N
NewProdu
uctAnalysis
kaged Facts analyses froozen pizza sales and prroduct trendds among Nestl,
N
Schwan and
a General Mills, the thhree largest frozen
f
pizzaa manufacturrers by FDM
Mx sales.
Septemberr 2012
9
Pizza at Foo
R
Executive Sum
mmary
Summarryanalysis
During 2006-2012,
2
frozen
f
pizzaa household penetration increased 5%
5 from 63%
% to 66%. More
M
impressivvely, frozen pizza houseehold engaggement also increased: thhe percentagge of househholds
eating froozen pizza at
a least oncee a month rose
r
7%, whhile the perccentage eatinng it at leastt five
times a month
m
rose 15%.
1
Howevver, nearer-tterm trends suggest decllining penetration (downn 1%
during 20010-2012) an
nd engagem
ment (1+ per month
m
use down
d
2%; 5+
+ per month use
u down 4%
%).
NestlU
USA
Through 2012, Nesttl USA hass dominatedd the pizza category
c
witth its DiGioorno, Tombsstone,
Californiia Pizza Kitcchen, and Jacks Originaal brands, accquired from
m Kraft in Maarch 2010. When
W
added to its Stouffers brand pizzzas, the acquuisition has catapulted Nestl
N
USA to the top of
o this
category,, with $1.38 billion in saalesa 45.4%
% share of SymphonyIR
S
RI-tracked saales.
But agaiinst the bacckdrop of a 2.6% deccline in frozzen pizza category
c
salles, Nestl sales
underpeerformed, drropping 4.8%
% during thee year endingg July 8, 20112. While thee decline weeights
to its supper-premium
m brands, onnly Nestlss regular DiG
Giorno brannd outperforrmed the maarket,
with a 2.4%
2
drop in sales. Suuperpremium
m offering offerings foound tough going, withh the
Californiia Pizza Kitcchen brand sales down 15.5% and thhe DiGiorno Ultimate linne extension sales
down 29.3%. But salles of its maainstream Toombstone braand also decclined 9.6%,, while the Jacks
J
and Stouuffers brandss declined onnly 0.4% and 2.5%, resppectively.
Already largest frozeen pizza in 2006, DiGioorno has inccreased its hhousehold peenetration allmost
012. Moreovver, 6% grow
wth during 2010-2012
2
s
shows
that itt has enteredd and
30% during 2006-20
s
posiition.
left the reecession in stronger
DiGiorn
no brand ussage is driven by 18-344s, black annd Asian connsumers, addults with <$$50K
householld incomes, households with children, and thosse living in the southeaast and southhwest
United States. Indexiing at 330, black
b
consum
mers are moore than 3 tim
mes as likelyy to eat DiGiorno
5+ times per month. Indexing at 188, <$25K
K HH incomee consumerss are almost twice as likeely to
eat DiGioorno 5+ timees per monthh.
mulate family-style meaals, DiGiornno offers DiGiorno Pizzza & Sidess that
In an atttempt to em
include a hand-tossed-style pizzza paired with
w
sides like
l
bonelesss wyngz, chocolate chip
cookies, breadsticks and cinnamoon sticks.
ntroduced Diipping Strip
ps, 12-pull apart
a
strips of
o DiGiorno deep crust pizza,
p
In 2012, DiGiorno in
availablee in three vaarieties: peppperoni, threee meat andd four cheesse, and are served withh two
dipping sauces,
s
mariinara and gaarlic. Nestl said the dippping strips are
a a shareaable take on
o the
pizza expperience. Neestl is also launching thhree premiuum pizza undder its DiGioorno Italian style
line: meaatball marinaara, chicken parmesan annd meat trio..
ng itself as restaurant competition,
c
In addition to framin
DiGiorno is positioning itself forr the
sports faan. In February 2012, DiGiorno
D
launnched its Coountdown too Greatness promotion
p
d
during
football championshi
c
ip season, where
w
playerrs could enteer a sweepstaakes to win prizes, suchh as a
years woorth of pizzaa, flat-screenn TV, cash annd more.
Septemberr 2012
10
Pizza at Foo
R
Executive Sum
mmary
Schwan
The Schw
wan Food Company
C
is a multibillioon-dollar privvate companny with a gllobal outlookk and
what it reefers to as aa solid preseence in roughhly 50 counttries. The company
c
is active
a
in muultiple
areas of the
t food ind
dustry includding retail, fooodservice, and
a home deelivery. Schw
wan is one of
o the
nations leading supp
pliers of frozzen pizzas too schools, thhrough its Global
G
Food Service unitt, and
ns the Tonys chain of pizzerias. Wee estimate thhat Schwan registered salles of
the comppany also run
approxim
mately $2.8 billion
b
in 20111.
Schwan markets
m
a nu
umber of brrands in the pizza category, but onlly threeFreschetta, Toonys,
and Red Baronhav
ve significannt sales, accoording to SyymphonyIRII. Specificallly, Red Barron is
the dom
minant bran
nd at $345 million, comprising almost 60% of Schwan
ns frozen pizza
p
sales. Reed Barons saales decreaseed by $8% during
d
the 522 weeks endiing July 8, 2012.
2
Freschettta, Schwans next biggest pizza braand, has fareed poorly, despite
d
growtth in the reccently
introduceed Simply In
nspired line. During thee 52 weeks ending Julyy 8, 2012, saales fell 16%
% to
$156 milllion.
Last of Schwans
S
biig three pizzza brands inn terms of annual
a
saless, Tonys, has
h also beenn the
hardest hit.
h Sales of the plebiaan brand wiith a cartooon Italian chhef mascot on its packkages
dropped
d 24%, suggesting that its
i relativelyy low price point carriees recession
n-era appeall.
The Schhwan Food Company extended
e
itss premium Freschetta frozen pizzza line in 2011,
2
developinng product and packagging that waas dramaticaally differennt from anytthing else inn the
crowded frozen pizzaa case. Frescchetta has also taken a neew marketinng approach via its Fresccehtta
Simply Innspired and Frescehtta By
B The Slicee introductioons. Says Mary
M
Brown, Schwans senior
s
director of
o marketing
g, The Simpply Inspired pizza offer large-cut
l
veggetables, sauuces and meaats to
create neew varieties unseen
u
in thiis category.
nos introducced Pizza Sttuffers, a lesss mess, on--the-go pizzaa in 2011, aimed
a
General Mills Totin
a moms wh
ho wanted, according to
t a survey, snack foodds with less mess. (Bussiness
directly at
Wire, Auugust 2011). The Stuffers are designeed to keep thhe filing insiide.
GeneralMills
Perhaps best
b known for its popullar breakfastt cereal suchh as Cheerioss, General Mills
M is one of
o the
worlds leading
l
food
d companies,, operating inn over 100 countries.
c
Major productt categories in
i the
United States
S
includee ready-to-eeat cereals, refrigerated yogurt,
y
ready-to-serve soup, dry dinnners,
shelf stabble and frozzen vegetablles, refrigeraated and frozen dough products,
p
deessert and baaking
mixes, frrozen pizza and pizza snacks, graiin, fruit andd savory snaacks, and a wide varieety of
organic products
p
inclluding granoola bars, cereeal, and soupp. Frozen piizza and pizzza snacks incclude
Totino's, Jeno's, Pizzza Rolls, Partty Pizza, Pillsbury Pizzaa Pops, and Pillsbury
P
Pizzza Minis.
ntroduced Pizzza Stuffers,, a less messs, on-the-go pizza in 2011, with it aimed
a
Its Totinoos brand in
directly at
a moms who
o wanted, acccording to a survey, snaack foods wiith less messs. (Business Wire,
August 2011).
2
The Stuffers are designed
d
to keep
k
the filinng inside.
Septemberr 2012
11
Pizza at Foo
R
Executive Sum
mmary
PizzaRe
estaurantBrandAnaalysis
CaliforniaPizzaKitchen
Menubu
uzz
Californiia Pizza Kitcchen has beeen called a culinary earrly adopter of food trennds, as evideenced
by its Koorean BBQ Steak
S
Tacos, jumping on board the trend populaarized by thee Kogi BBQ food
truck (N
Nations Resttaurant New
ws, June 20122).
With CP
PKs use of small platess and its debbut of a Sm
mall Cravinggs menu in 2010, COO
O Sue
Collyns said
s
the average check prices
p
were up by 20%.. There is allso a CPKids Menu desiigned
for kids 10
1 and underr in an effortt to appeal too families.
ons
Healthierintroductio
In April 2012, CPK introduced the Limitedd Chicken Carbonara Pizzza that feattures a thin crust
w
garlic crme fraicche sauce, rosemary,
r
g
grilled
whitee meat chiccken, applew
wood
topped with
smoked bacon,
b
onion
ns, parmesann, asiago, rom
mano and mozzarella chheese. It retaiils for $6.69.
It also unnveiled the Limited
L
Edittion Chipotlee Roasted Vegetable
V
Pizzza, a thin-crrust pizza toopped
with roassted red and
d yellow pepppers, poblanno peppers, roasted cornn, black beaans, chipotle lime
sauce, paarmesan, asiago, romanoo and mozzaarella cheesees. It, too, reetails for $6..69. (Snack Food
F
& Wholeesale Bakery, June 2012)).
In June 2011,
2
as parrt of a widee menu item
m launch, CP
PK announcced it now only
o
uses naatural
chicken and
a a wide variety
v
of naatural meats in its recipees. In additioon, gluten-freee crusts aree now
an optionn with 29 off the brandss original pizzzas. The crrust joins a list
l of other gluten-free items
i
the chainn identified earlier
e
includding soups, salad,
s
appetizers and dessserts.
Custome
ertrafficand
ddemographictrends
m
Unfortunnately, the peercentage off consumers using CPK and using itt at least 1+ times per month
has declined during 2008-2012,
2
f
falling
from 3.8% to 3.6% and from 2.3% to 2.1%, respectivvely.
Not surprrisingly, thee CPK consuumer is moree likely to bee interested in gourmet food,
f
food thhat is
presentedd as an art fo
orm, and nattural/organicc foods. But the CPK cuustomer is allso more likeely to
prefer faast food to home
h
cookiing and to enjoy
e
eatingg frozen dinnners, in a tip
t of the hat
h to
convenieence.
most 50% moore likely thaan average to be CPK cuustomers, indexing at 1447 for
True Fooodies are alm
any use and
a 135 for monthly usee, suggestingg that CPK is
i deliveringg on its prom
mise of a cullinary
adventure. No other major
m
pizza chain drawss this degree of True Fooodies.
Septemberr 2012
12
Pizza at Foo
R
Executive Sum
mmary
Domino
os
Dominos has sough
ht to leveragge its brandd by continuuing to introoduce innovvative, consuumertested annd profitablle new product varietiies (such as
a Oven Baaked Sandw
wiches, Dom
mino's
Americann Legends pizzas
p
and BreadBowl
B
Pasta), com
mplementary side items (such as chheesy
bread, booneless chiccken and winngs, Cinna Stix and Chhocolate Lavva Crunch Cakes)
C
and value
v
promotioons as well as
a through marketing
m
affiiliations withh brands succh as Coca-C
Cola.
Innovatio
onandactivvity
Dominos continues to prove its willingnesss to reach coonsumers thrrough new technologies, (via
a menu innnovation tied to
online orrdering and mobile appps), promotioons with paartnerships, and
taste andd health trend
ds (via artisaan pizzas andd gluten-freee crusts).
Its most significant menu introdduction occuurred duringg Q4 2009, when, in ann effort to better
b
compete on taste, Do
omino's launnched its refformulated core
c
pizza product.
p
Thee launch receeived
significannt media atteention and, according
a
to the companny, resulted in
i positive inncreases in trraffic
and saless in its U.S. stores
s
througghout 2010.
ArtisanP
Pizzapromissesquality;p
providesupssellingamm
munition
In Septem
mber 2011, Dominos
D
Piizza introducced an Artisan Pizza linee that includdes three varrieties
of pies: Spinach
S
& Feta,
F
Italian Sausage & Pepper Trio, and Tuscann Salami & Roasted Veeggie.
The com
mpanys Artissan pizza, inntended to continue
c
to enhance
e
the brands quaality image, gives
customerrs incentive to
t trade up from
f
Dominos 2 for $5..99 promotioons. The purrpose was too shift
away froom popular price-centriic promotioons to broadden its appeeal beyond the collegee and
football crowd.
c
Newmen
nuintroducttionanalysis
otsteps of thhe gluten-freee trend, Doominos beccame the firrst national pizza
Followinng in the foo
delivery chain to offfer gluten-free crust. Thhe brand connsulted with the Nationaal Foundatioon for
Celiac Awareness
A
to
o ensure it met the standards of the foundattion. Said J.
J Patrick Doyle,
D
Dominos pizza and
d CEO, Thee prevalencee of gluten sensitivity
s
h become a real issue with
has
significannt impact on
n consumer choice,
c
and we
w want to be
b a part of the
t solution,, (PR Newsswire,
May 2012). Dominos even creatted a video on
o YouTubee that allows customers to
t decide whhether
the crust is suitable for
f their diet..
Its new offerings
o
fallls into two broad categgories: artisaan pizza andd breads & sides. Dom
minos
continuess to reach for
f an upscaale consumeer with its artisan pizzas, especiallly the use of
o its
toppings,, which incllude fresh spinach,
s
roasted red andd banana peeppers, and parmesan-aasiago
cheese.
Septemberr 2012
13
Pizza at Foo
R
Executive Sum
mmary
Sides an
nd apps up the flavor ante:
a
Breadss contain freesh spinach and cheese, and its bonneless
wings arre made with
h 100% whhite meat. All
A newly inttroduced offferings fall within a buudgetfriendly price
p
point of
o $5.99. In doing so, Doominos upss the flavor ante.
a
Its hott wings dont just
come wiith any hot sauce: theyy come withh mango haabanero, whhich conveyys sweetnesss and
extreme heatand conveys a sauce com
mbination exxpectation that
t
is a cuut above saauces
introduceed just a few
w years ago.
Q2 2012 on track fo
or growth: By
B Q2 2012, more than 30% of total sales had come
c
from digital
d
channels. In April 20
012, orderinng surpassed $1 billion in annual diggital sales inn the U.S. At
A this
point, booth mobile ap
pps, iPhone and
a Androidd, had entereed the top 100 lifestyle, annd food and drink
rankings in the iTunees store and on Google Play. Accorrding to the companys
c
Q 2012 invvestor
Q2
conference call, mob
bile ordering apps have been
b
downlooaded almostt 3.5 millionn times. Dom
mino's
now offeers its mobilee ordering appp to more thhan 80% of the
t smartphoones in the U.S.
U
Custome
ersegmentationbymob
biledevicein
nteraction
Higher-fr
frequency Do
ominos userrs (6+ visits per month) are more thhan twice as likely as aveerage
to belongg to the Mob
birati mobilee phone segm
mentation grroup, providding strong opportunity
o
for it
to connecct with highlly engaged mobile
m
phone users.
Keyconssumergroup
ps
At everyy level of engagement (any use, use
u once a month,
m
and use 6+ times a month)), 1824s and black
b
consum
mers are verry relevant to
t the Dominnos brand. Only amongg highly enggaged
(6+ uses per month) do we see the
t effect off household income, as <$25K
<
HH income userrs are
more thaan twice as liikely to use the
t brand, annd Hispanic and Asian use
u is also moore prevalennt.
12Guesttraafficfrequen
ncyanalysis
2009201
nsumers agee 18+ use Dominos,
D
d
down
slightlly during 20009-2011. While
W
Some 144.1% of con
10.4% off adult consumers use the brand beetween 1 andd 5 times peer month, abbout 1% usee it at
least 6 times per month.
m
Durinng 2009-2012, Dominos usage hass remained relatively sttable,
u
1-5 tim
mes per moonth, and ussage 6+ timees per montth. Howeverr, the
includingg any use, usage
percentagge of Hispan
nic engaged users is trennding down,, falling almost 3% perccent from 2011 to
2012 in the
t any use and 1-5 visits
v
per monnth categorry.
Higher-fr
frequency Do
ominos users (6+ visitss per month)) are almost twice as likkely as averaage to
belong too the Varietty on a Buddget food segmentation group, suppporting Dom
minos conteention
that it perrforms well with impulsse-driven connsumers.
Septemberr 2012
14
Pizza at Foo
R
Executive Sum
mmary
LittleCaaesarsPizzaa
Little Caaesars Pizzaas biggest brand
b
activitty is the return of its famous tag,, Pizza! Pizza!
Otherwisse, its markeeting seems focused on an up-to-thhe-minute quuick responsse via its Tw
witter
account (http://twitte
(
er.com/littleccaesars) and Facebook.
In June 2012,
2
after a 15-year abbsence, Little Caesars announced
a
itt was reinstaating the tagg and
Little Caaesar characcter to restoore fun to thhe brand. Said
S
Gerry Graf,
G
found a at BFG 9000
(creators of the camp
paign), It seeems like everyone got really
r
serious about pizzza all of a suddden,
talking abbout artisanaal pizzas andd apologizinng for the waay their pizzaa was made.. Bu if you take
t
a
step backk and look att pizza, its fun
f
(Adverttising Age, Juune 2012).
Newmen
Aside froom its new flavors
f
of Caaesar Wingss, Little Caessars seems to be resting on its laureels. In
Novembeer 2011, Litttle Caesars introduced five new vaarieties of Caesar Wingss. There are now
eight varrieties overaall, includingg Oven Roaasted, Buffallo, Barbequee, Spicy Barrbeque, Teriiyaki,
Lemon Pepper,
P
Garliic Parmesan and Bacon Honey
H
Musttard (PR New
wswire, Novvember 2011).
Promotio
onalactivityy
It seems as if Little Caesars
C
cant get enouggh of pushingg its Crazy Bread.
B
Aside from the Crazy
C
Bread, it focuses on its Hot-N-R
Ready pizza. Little Caesaars pizzas aree all under $10,
$
and mosst are
between $5-7, which
h is quite a deal.
d
We beliieve the brannd already seees itself as discountingg its
prices, soo most tradittional promootions arent necessary.
The $5 laarge peppero
oni Hot-N-R
Ready pizza, as well as the
t $8 large three-meat pizza
p
is the main
promotioon (Advertisiing Age, June 2012).
Technolo
ogyinnovatiion
Little Caaesars has a website
w
that promotes itss brand, but aside from an
a iPhone appp, has done little
to capitallize on techn
nological innnovation. Thhis seems an area sorely lacking
l
from
m the brand.
ps
Keyconssumergroup
18-34s, Hispanics,
H
th
hose with chiildren, and those
t
makingg $50-$74K are more likkely to visit Little
L
Caesars. Among eng
gaged userss (those who have eateen Little Caaesars 1-5 tiimes in the past
month), usage by age
a is still highest am
mong 18-34ss, though 255-34s skew slightly hiigher.
Howeverr, Hispanicss are by farr the higheest indexed consumers at 150, folllowed by black
b
consumers at 101.
Septemberr 2012
15
Pizza at Foo
R
Executive Sum
mmary
Among highly
h
engag
ged users (thhose who havve eaten therre 6+ times in
i the past month)
m
18-244s are
twice as likely to visit Little Caaesars multipple times ass their nearest competitoor, 25-34s. Black
B
consumers lead the Little
L
Caesaars charge att an index of
o 263, closeely followedd by Hispaniics at
211. By household income,
i
<$225K users arre most likelly to use thee brand 6+ times
t
per month,
m
followedd by the $25
5K-$49K HH
H income users.
u
Againn, consumers with childdren index much
m
higher thhan those witthout childreen.
2008201
ncyanalysis
With its very
v
low priice points, Little
L
Caesarss is likely ridding the receession wave,, attracting valuev
consciouus consumerss willing to sacrifice
s
som
me quality foor a better prrice: among those who report
r
any use, as well ass those who use the brannd 1+ and 6+
+ times per month,
m
usagge penetration has
increasedd during 200
08-2012. Duuring this peeriod, its poppulation univverse has inncreased by more
than 10 million,
m
up almost
a
70%.
PapaJoh
hns
ositioning
Brandinggthatreflecttsqualitypo
Papa Johhns brandiing reflects its qualityy positioninng. This inccludes conttinuing to forge
relationshhips with paartners (suchh as Pepsi) that help teell its Betteer Ingredientts. Better Piizza.
story to increasingly
i
wider audieences.
Strategypayingoff
This strattegy appearss to have paiid off, in the form of awaards, recognnition and salles growth.
a hotels), Papa
Inn a report raanking all coompanies (inncluding airllines, expresss delivery and
Joohns rated No.
N 1 in Lim
mited Service Restaurantt by the Am
merican Custoomer Satisfaaction
Inndex, with th
he highest category scorre in survey history (Buusiness Wire, June 2012)). Its
thhe 11th timee in the pastt 13 years thhat Papa Johhns has possted the highhest score am
mong
national pizzaa businessess. Said John Schnatter, Papa
P
Johnss Founder annd CEO, B
Better
B
Pizza has been the
t foundatioon of everytthing we strrive foritss this
Inngredients, Better
loong-term com
mmitment too qualitytthat has drivven our succcess. Papa Johns scoreed an
83.
The ACSI ran

T
nking follow
ws positive attribution
a
inn the 2012 Harris
H
Poll EquiTrend
E
S
Study,
w
which
named
d Papa Johnns as its 20012 Pizza Brrand of the Year due too the compaanys
quuality and co
onsumer preeference.
As detailed in
A
i Sales Peerformance (see below
w), domesticc company-oowned restaaurant
coomparable sales
s
increassed 4.1% in 2011, and they
t
spiked 7.4% duringg the first haalf of
2012.
Septemberr 2012
16
Pizza at Foo
R
Executive Sum
mmary
Innovatio
onandactivvity
Papa Johhns must bee doing som
mething rightt. Sales are growing, trraffic is stabble, and as far
f as
awards programs
p
aree concerned, its a qualityy brand. Thee brand also gets a disprooportionate share
of traffic from highly
y-engaged (66+ visits per month) wom
men, which says a lot abbout what woomen
t brand as a trusted souurce to feed their familiees.
think of the
Papa Johhns continuees to exploree variety in its
i menu, esppecially withh its use of chicken,
c
a leearner
protein with
w the kind
d of health profile
p
that might
m
be fouund on pizzaa at Californiia Pizza Kitchen.
Finally, Papa
P
Johns relationshipp with the National
N
Foootball Leaguee ties the brrand to the years
y
biggest pizza
p
eventt, the Superr Bowl, andd Papa Johhns continuues to leverrage this unnique
relationshhip in many of its promootions.
Newmen
Papa Johhns has not rested
r
on itss laurels; thee brand has inntroduced a variety of new
n offerings and
promotioons to attractt and maintaiin its custom
mer base.
Chicken
n Parmesan Pizza LTO
O: In July 2012,
2
Papa Johns
J
introoduced Chickken Parmesan to
pizza. Saaid Andrew Varga, chieef marketingg officer, C
Chicken Parm
mesan is a premium
p
offfering
that manny people en
njoy at upsccale, fine dining Italiann restaurants around thee country. Weve
W
taken it to
t another leevel and are offering thee popular flaavor combinnation on a pizza
p
(Heallth &
Beauty Close-Up,
C
Ju
uly 2012). The pizza is offered at $10. Consum
mers can alsoo order any other
large pizzza, with up to
t five toppinngs, for onlyy $2 more.
Buffalo Chicken Piizza LTO: In
I March 20012, Papa Joohns launchhed its new Buffalo Chiicken
pizza, a combination
c
n of creamy ranch saucee, all-white slice
s
chickenn strips, crisspy bacon, freshf
sliced onnions and freesh cheese, all
a topped wiith buffalo saauce. Its avvailable for $10.
$
Said Anndrew
Varga, chief marketiing officer for
f Papa Johhns, Consumers have spoken andd weve listened.
America told us thatt they wanteed Buffalo Chicken
C
andd that baconn was a favoorite (Markketing
N
March
h 31).
Weekly News,
S
& Peppers
P
Pizza LTO: In November 2011,
2
Papa Johns
J
introdduced the Cllassic
Classic Sausage
Sausage & Peppers, a pizza loadeed with saussage and peeeper, availablle for $11.
Promotio
onalactivityy
While otther chains such
s
as Dom
minos and Little
L
Caesarrs, push disccounts, Papaa Johns has been
trying hard
h
to hold
d the line on
o discountting, insteadd sticking with
w
its longg-held prem
miumproducts--at-premium
m-prices messages (Adveertising Agee, March 20112).
Septemberr 2012
17
Pizza at Foo
R
Executive Sum
mmary
Technolo
ogyinnovatiion
Papa Johhns understaands that a strong technnology platfform is criticcal for its fuuture successs. Its
digital orrdering platfform allows customers to
t order onliine, and inclludes plan ahead orderring,
Spanish-language orrdering capaability, and enhanced mobile
m
web ordering for our custom
mers,
a
me the
includingg Papa John's iPhone annd Android applications
. In May 20011, Papa Joohns becam
first pizzza chain to reeach $2 billiion in onlinee sales (beatiing larger rivvals Pizza Hut
H and Dom
minos
to the puunch). The company
c
weebsite is avaailable in Sppanish, whicch facilitatess online Hisppanic
pizza salees.
ersegmentationbymob
biledevicein
nteraction
Custome
frequency Paapa Johns users (6+ visits
v
per moonth) are more
m
than tw
wice as likeely as
Higher-fr
average to
t belong to the Mobiratti group. Theey are closely followed by Social Connectors.
C
T
These
present Papa
P
Johns an opportuunity to reacch a highly engaged cuustomer basee through mobile
m
phone tecchnology.
ps
Keyconssumergroup
b
consuumers and those with 1+ kids are moore likely to use Papa Joohns.
18- to 244-year-olds, black
Compareed to Domin
nos and Pizza Hut, Paapa Johns also skews to a slightlly higher-inccome
consumer.
Among engaged
e
userrs (those whho have eatenn Papa Johns 1-5 times in the past month),
m
usagge by
age skew
ws to 25-44s, followed by
b 18-24s, which
w
suggessts greater reeliance on faamilies and more
established househollds than on the youngeest adults. Black
B
consum
mers, who index at 1788, are
almost tw
wice as likely as Hispannic or whitee consumers to be engagged Papa Joohns users. The
brand alsso attracts a disproportioonate share of
o $50K-$74K householdds, squarely positioning them
as a midddle-class desstination.
Attractin
nghighlyenggagedwome
en
In a depaarture from other
o
major pizza brands, women arre 50% moree likely thann men to eat Papa
Johns 6+
+ times per month. Maany of these women maay be busy mothers
m
pickking up pizzza for
their fam
milies in an effort
e
to provide an easyy-to-serve, higher-qualit
h
ty meal theyy know theirr kids
will enjoy. On a relaated note, houuseholds with 1+ childreen index at 160, almost three times more
than houuseholds witthout at 64, which sugggests consum
mers with kids
k
are drivving Papa Joohns
sales. Hoowever, by age,
a
18-24s are most likkely to use the brand, suggesting
s
that its valuee and
quality positioning reesonates withh youth as well
w as familiies.
Septemberr 2012
18
Pizza at Foo
R
Executive Sum
mmary
2008201
ncyanalysis::positivemo
omentum
Both throough the recession and afterward,
a
Paapa Johns guest
g
traffic has improveedno smalll feat
in a pressured foodseervice enviroonment that has seen restaurant pizzza sales slow
w to a crawl. The
percentagge of consum
mers who siimply use the brand has
h increaseed from 2008 to 2012, albeit
a
with a sliight drop fro
om 2010 to 2012.
2
Higherr-engagemennt trends are also healthyy.
PapaMu
urphys
Papa Muurphys know
ws its nichee and it playys to it well.. Marketing itself as thee antidote too late
deliveries and greassy pizza, it also positioons itself ass a (literallyy) fresh alteernative to those
consumers who seek
k healthier alternatives. Along thesse lines, new
w menu innnovations feeature
chicken (a
( leaner, heealthier proteein) and eveen zucchini. As far as prromotions, itt keeps pizzza fun
with seasonal shap
pes pizzas, such as thee Halloweenn jack-o-lanttern or the Valentines Day
heart-shaaped pizza.
Newmen
Papa Muurphys play
ys to consum
mers who waant fresh inggredients andd a meal coooked at hom
me. It
continuess to branch out into neew flavor coombinationss, such as thhe Taco Graande Pizza, Thai
Chicken Delite and Bacon Cheeeseburger Pizza.
P
It hass also introdduced the Mini
M
Murphh (see
below), targeted
t
to kids.
Mini Mu
urph Makee-n-Bake Piizza Kit: Inn March 20112, Papa Muurphys introduced the Mini
Murph Make
M
N Baake Pizza Kit.
K The kit includes
i
sevven inch pizzza crust rollled out on Papa
Murphys signature bake-n-servee tray; contaainer of pizzza sauce; geenerous amoount of 100%
% allnatural, whole-milk
w
mozzarella;; nearly a dozen
d
slices of real peppperoni; tem
mporary Muurph
tattoo; annd baking in
nstructions. A cheese only
o
optionn is also avaailable. Saidd Jenifer Annhorn,
Chief Maarketing Offficer at Papaa Murphys, We wanted to make family
f
pizza night even more
fun and weve
w
met th
hat goal withh the Mini Murph.
M
The kids liked thhat it gave thhem a role in
i the
familys meal prepaaration proceess. Others loved
l
using the Mini Murph
M
as ann activity at their
childs biirthday party
y (PR Newsswire, Marchh 2012).
Papa Muurphys prom
motions revollve around seasonal
s
item
ms, such as thhe Jack-o-Laantern and HeartH
shaped pizzas, as well as $8 pizzza deals.
Mobilem
marketingsttrategy
m
marrketing relaationship exxtended: In August 2012, Papa Muurphys expaanded
Phizzle mobile
its partneership with mobile
m
markketing providder Phizzle. The
T mobile product
p
is avvailable in nearly
n
550 frannchised restaurants throough 26 staates. A parrtner since 2010, Papaa Murphys runs
customizzed in-store signage, moobile campaaigns and prromotions featuring
f
moobile alerts. Said
Jenifer Anhorn,
A
Con
nsumers are seeking faster and moree flexible waays to access our restaurrants.
Septemberr 2012
19
Pizza at Foo
R
Executive Sum
mmary
Its impoortant for uss to offer neew and exciting ways for
fo our custoomers toengage with Papa
Murphys (mobilepa
aymentstodaay.com, August 2012).
Redemption rates look prom
mising: Throough Phizzlles proprieetary mobilee platform, the
franchisees have seen
n redemptionn rates as higgh as 18% from
fr
the offeers deliveredd to their speecific
mobile database and
a
trackedd in real-ttime througgh Phizzles mobile platform
most
customerrshave upg
graded their purchases.
Custome
ersegmentationbymob
biledevicein
nteraction
D
P
Pizza
Hut annd Papa Johhns, which draw most heavily from
m the
Unlike competitors Dominos,
S
Mobirati mobile seegmentation group, Paapa Murphyys draws most heaviily from Social
Connectoors. Papa Mu
urphys alsoo differentiattes itself froom these othher brands byy drawing highly
h
engaged Mobile Proffessionals annd engaged Pragmatic
P
Adopters.
P
Murphyys 6+ timess, followed by Moberatti and
Social Connectors arre most likeely to visit Papa
Mobile Professional
P
s. Papa Muurphys Faceebook prom
motional tie-iins may be finding a ready
r
audiencee in Social Connectors.
C
This is becaause commuunication is central
c
in thhe lives of Social
S
Connectoors. Their ceell phone alloows them too keep up-to-date with friends
fr
and social events. The
cell phonne device is the bridge to their sociial world. Highly
H
engagged Mobile Professional
P
ls are
also moree apt to grav
vitate to Papaa Murphys than to Dom
minos, Pizzaa Hut and Paapa Johns, which
w
suggests their apprreciation forr quick-pickk up optioons they caan make att home. Mobile
M
Professioonals use theeir cell phonne to help theem keep up with their prrofessional life
l in additiion to
their perssonal life.
ThePapaaMurphysC
Consumer
w
consum
mers, those living in thhe Pacific reegion,
Papa Muurphys appeeals most sttrongly to white
consumers with 3+ children,
c
andd higher-incoome users. The
T philosopphy behind freshly
f
madee take
p
conneccts with connsumers whoo wish to ccook dinner at home without the haassle,
n bake pizza
while prroviding a relatively
r
high-quality meal for families
fa
andd individualss. Overall, Papa
Murphys also draws a higher ratio
r
of highh-income connsumers thaan competitoors such as Pizza
P
D
Hut and Dominos.
2008201
ncyanalysis
Papa Muurphys guest traffic has grown modderately but steadily
s
duriing 2008-20012, with gaiins in
any use and in high
hly engaged (6+ visits peer month) usse.
Custome
ersegmentationbyfood
dlifestyle
The brannd differentiaates itself onn the basis off drawing hiigh-frequenccy use from the True Foodies
food segm
mentation grroup and midd-frequencyy use from Weekend
W
Coooks.
Septemberr 2012
20
Pizza at Foo
R
Executive Sum
mmary
PizzaHu
ut
Followinng positive growth
g
in 20010, Pizza Hut
H deliveredd modest grrowth in 20111, driven by the
companyys focus on everyday vaalue, new prroducts and value
v
bundlees, which thhe company plans
to continnue to leveraage going foorward. Pizzza Hut mainntains an agggressive staance in its use
u of
Facebookk and Twittter promotioons, successsfully drawiing in sociaal connectorrs for someewhat
frequent use.
Newmen
nuintroducttion&prom
motionanalyysis
PZolo takes
t
aim at
a subs: Thee PZolo is Pizza Hutss fire across the bow att sandwichess and
subs, reinnforced with
h advertisingg taglines succh as See Ya
Y Subs. Thiis is the PZ
Zolo and Say so
long to a footlong. The
T $3 (or 2 for $5) price point andd its three flaavor varietiees make it quuite a
competitor. The Itallian Steak resembles
r
a Philly Cheeesesteak, while
w
the Meat
M
Trio PZolo
channels the Strombo
oli for inspirration.
Subway Takeover promotion
drives hom
p
me message: To help prromote its Juune 2012 PZolo
introducttion, Pizza Hut
H launchedd a Subway Takeover by
b commanddeering a paair of subwayy cars
in Chicaggo. On June 7th, Pizza Hut
H passed ouut free PZolos at select spots, later announced on
o its
Facebookk page. Said
d Kurt Kane,, Pizza Hut CMO, Its more than a sandwich. Its a new flavor
f
creation that
t is leavin
ng the sub caategory behiind (PR New
wswire, Junee 2012).
Pizza cru
usts and breeads making way onto menu: Withh the introduuction of the Ultimate Stuuffed
Pizza Crrust, Cheesy
y Bites Pizzza and Garlic Bread Piizza, the braand continuues to tinkerr and
expand on
o what defin
nes a crust, giving
g
these offerings a firm line-upp with the othher novelty pizza
offeringss.
Spreadin
ng the wealth with family deals: To providee incentivess for value-sseeking fam
milies,
Pizza Huut introduced
d its Big Boxx Dinner LTO
O, a supplem
ment to its $10 pizza deaal.
Mobilereach
H offers mobile
m
ordeering apps: In July 2010,
2
Pizza Hut introdduced an iP
Phone
Pizza Hut
applicatioon allowing
g customers to downloaad coupons and place orders throuugh their mobile
m
phones. In
I May 2011, Pizza Huut offered freee mobile orrdering appss for the Anndroid and Apple
A
iPad and iPhone.
Drawingg from Mob
bile Generattion and Soocial Connecctors: Higheer-frequencyy Pizza Hut users
(6+ visitss per month)) are about 2.5
2 times as likely
l
as average to belonng to the Moobirati groupp.
Keyconssumergroup
ps
b
consum
mers, those living in the Southwest, and those with 3+ kids are
a more likeely to
18-34s, black
visit Pizzza Hut for aany use.
Septemberr 2012
21
Pizza at Foo
R
Executive Sum
mmary
Engaged
d users: you
uth, region, and race: Users
U
who visited
v
Pizza Hut 1-5 tim
mes in the paast 30
days tell the same sttory: 18-34s, black conssumers, those living in the
t Southweest, those witth 3+
kids, andd a householld income beetween $50--$74K are most
m likely too make repeeat visits to Pizza
P
Hut.
Highly engaged
e
users: HH incoome adds a twist: Highhly engaged users,
u
those who have viisited
Pizza Huut 6+ times in
i the past month,
m
repeaat the patterrn, except onn steroids. 18-24s are allmost
twice as likely to visiit Pizza Hut 6+ times whhen compareed to its clossest bracket; black consuumers
index at 277
2 (with Asian consum
mers at 162); Household income, how
wever, becom
mes a much more
importannt usage deteerminant am
mong highlyy engaged ussers: <$25K
K HH incom
me users inddex at
198, while $25-$49K
K HH incomee users indexx at 128.
2008201
ncyanalysis
t
has treended downward duringg 2008-12. During
D
this period of timee, the
At Pizza Hut, guest traffic
o the adult population visiting Pizzza Hut fell 1.5 points, with
w 1-5 visit-a-month usage
u
percent of
falling onne percentag
ge point. Higgh-frequencyy usage also dropped.
Septemberr 2012
22
Pizza at Foo
R
Marrket Size and Fo

orecast
Chap
pter2:MarketSizeand
Forecast
INTRODU
UCTION
In this secction, we pre
esent a marrket size and
d forecast fo
or retail pizzza sales and
d for U.S. pizza
restaurantts, as well as
a supporting
g analysis on
o segment share and growth
g
(limitted-service, fullservice re
estaurants; pizza
p
restau
urant chain sales
s
trendss, frozen and refrigerate
ed retail pizzza),
retail brand analysis, retail
r
manufa
acturer analyysis, and priivate label growth and share.
INSIGH
HTCAPSU
ULE
Packaged
d Facts fore
ecasts saless at U.S. pizzza restaura
ants to reacch $36.1 billion in 2012
2, up
3.8% from
m 2011. We
e forecast U.S.
U
pizza re
estaurant 20
011-2014 co
ompound an
nnual growtth of
3.3%. In 2012, we expect U.S. frozen and refrigerated pizza saless to registerr sales of $4
4.91
billion, do
own 0.9% from
f
2011. We forecasst U.S. frozzen and reffrigerated pizza 2011-2
2014
compound
d annual gro
owth of -0.1%
%. These esstimates are unadjusted for inflation..
The resta
aurant side
e: In 2012, we
w expect th
he limited-se
ervice eating
g places to generate $2
26.2
billion, or 78.5% of U.S.
U
pizza re
estaurant sales, with fulll-service resstaurants generating 22..5%.
Riding a post-recess
pizza restaurant sales will
sion return to full-service dining, full-service
f
outpace liimited-servic
ce sales, witth a 2011-20
014 CAGR of
o 5.2% versu
us 2.8%.
While pizza restaurants may be losing sharre to other restaurant
r
cuisine forma
ats, major pizza
p
chains ha
ave continue
ed to grow sales:
s
the top
p 10 chains by systemw
wide sales grew
g
revenue
e by
8.8% duriing 2009-2011 and by 3.3%
3
during 2010-2011.. However, sales
s
growth
h is weighted
d by
size: four of the top five chains (P
Pizza Hut, Domino's
D
Pizzza, Little Ca
aesars and Papa Murph
hy's)
grew sale
es by at leastt 10% during
g 2009-2011
1. Third-placce Papa John
n's grew sale
es by 6.4%.
The retaiil side: In 2012,
2
we expect frozen
n pizza sale
es to reach $4.58 billio
on, or 93.2%
% of
combined
d sales, with refrigerated
d pizza gene
erating $330 million, or 6.8%.
6
However, refrigera
ated
pizza sale
es will outpace those of frozen pizza
a, with a 2011-2014 CAG
GR of 2.0% versus
v
-0.2%
%.
Private la
abel continues to grow salesand
d steal share
ein each of three FD
DMx retail pizza
p
segmentss: frozen pizz
za, pizza pro
oducts, and refrigerated
d pizza, and it grew its frozen pizza and
refrigerate
ed pizza sale
es share. Prrivate label now
n
commands a 13.3%
% share of re
etail pizza sa
ales.
This repre
esents a 1.4 percentage
e point share
e increase, on
o the heels of 9% saless growth.
Category growth is bu
ubbling up frrom the botttom: Among the top 12 frozen
f
pizza
a manufacturrers,
significant growth cam
me only from
m boutique companies
c
N
Newmans
Own and Amyys Kitchen, with
37% and 10% sales growth,
g
resp
pectively. Sales among the
t top 12 manufacturer
m
rs declined 3.1%
3
for the ye
ear ending Ju
uly 8, 2012. Excluding private
p
label, sales among the rema
aining 14 bra
ands
declined by
b 5.3%. Am
mong the top
p 10, only To
otinos grew sales by at least 1% (3.2
2%).
Nestl USA dominattes the pizzza categoryy with its DiGiorno,
D
To
ombstone, California
C
P
Pizza
Kitchen, and
a Jacks Original
O
bran
nds. When added
a
to its Stouffers brand
b
pizzas, the acquissition
has catap
pulted Nestl
USA to the
e top of the category, wiith $1.38 billlion in sales, a 45.4% sh
hare
of Symp
phonyIRI-trac
cked sales
about 26 percentage points ahead of No. 2 Schwan Food
F
($595 million and 19..5% share)
but down 1.0 percenta
age points from
f
the yea
ar-earlier period.
Schwanss share of sa
ales dipped 2.3
2 percenta
age points.
While cha
allenges exis
st, some (ne
ew) brands and
a line exte
ensions are bucking the trend, including
the Fresccehtta Simply
y Inspired line extension, Totinos Pizza
P
Stuffers, and Dr. Oetker. With
h an
average unit
u retail priice of $3.17,, frozen pizzzas are well within the re
each of household budg
gets.
However, as illustratted by wide
e pricing diffferences am
mong the fa
astest growin
ng frozen pizza
p
brands an
nd line exten
nsions, consumers will support the growth
g
of value and prem
mium offering
gs.
Septemberr 2012
23
Pizza at Foo
R
Marrket Size and Fo

orecast
Markettsizeandfforecast
In this seection, Packaged Facts presents
p
marrket forecastts for sales at
a U.S. pizza restaurants and
U.S. retaail pizza salees. Our U.S. pizza restauurant markett size and foorecast is seggmented by sales
at 1) fulll-service resstaurants andd 2) limited--service eatiing places. Our
O U.S. rettail pizza market
m
size and forecast is segmented by sales off 1) frozen pizza
p
and 2) refrigerateed pizza (eaach at
grocery/ssupermarkets, mass merrchandisers, drug storess, supercenteers, dollar sttores, club stores
s
and speciialty stores)..
Forecastsummary
i 2012, up 3.8%
from 20111. We foreccast U.S. pizzza restaurant 2011-20114 compoundd annual groowth of 3.3%
%. In
2012, wee expect U.S
S. frozen andd refrigerated pizza sales to registerr sales of $4..91 billion, down
d
0.9% froom 2011. We
W forecast U.S.
U frozen and
a refrigeraated pizza 2011-2014
2
c
compound
annnual
growth of
o -0.1%. Theese estimates are unadjuusted for inflaation.
ndix regardinng our methoodology.
Please seee the Appen
Restaurrantpizzamarketsizzeandfore
ecast
i 2012, up 3.8%
from 20111. We foreecast U.S. pizza
p
restaurrant 2011-20014 compouund annual growth of 3.3%.
3
These esttimates are unadjusted
u
fo inflation.
for
Grap
ph21:RestaaurantPizzaaMarketSize
e&Forecast,20072014
4
Source: Packaged Facts, based in part on data from the U.S.

U
Census & U.S.
U
Bureau of Ecconomic Analysis
Note: da
ata represents sa
ales at full-service
e pizza restauran
nts and limited-se
ervice eating pla
aces.
Septemberr 2012
24
Pizza at Foo
R
Marrket Size and Fo

orecast
Fullservvicepizzare
estaurantssalesgrowtthoutpacesslimitedse
ervicesegm
ment
In 2012, we expect th
he limited-service eatingg places seggment to gennerate $26.2 billion, or 78.5%
of U.S. pizza
p
restau
urant sales, with
w full-serrvice restaurrants generaating $9.9 billion, or 222.5%.
Riding coonsumers post-recessio
p
on return to full-service
f
d
dining,
full-service pizza restaurant sales
will outppace those of
o pizza lim
mited-servicee eating placces, with a 2011-2014 CAGR of 5.2%
versus 2.8%.
Graaph22:FullService&LLimitedServviceRestaurrantPizzaM
MarketSize&
&Forecast,
20072014
Source: Packaged Facts, based in part on data from the U.S.

U
Census & U.S.
U
Bureau of Ecconomic Analysis
Note: da
ata represents sa
ales at full-service
e pizza restauran
nts and limited-se
ervice eating pla
aces.
Declinin
ngshareofrestaurantsales
2
we
w estimate that
t the sharre of sales atttributable too pizza restaaurants and eating
e
During 2010-2012,
places haas fallen slig
ghtly, droppping 0.4 perccentage poinnts to 7.5%. However, the
t share deecline
has been more prono
ounced at lim
mited-servicee restaurants.
T
Table21:Pi
izzaRestaurrants:ShareofRestauraantSales,byySegment,2
20102012
Pizzza restaurantts
Full-service res
F
staurants
L
Limited-service
eating places
2010
2012
Sha
are change
7.9%
4.1%
11.6%
7.5%
4.0%
11.2%
-0.4
-0.1
-0.4
S
Source:
Packaged Facts, based in
n part on data fro
om the U.S. Census & U.S. Bureau of Economic Analysis
Septemberr 2012
25
Pizza at Foo
R
Marrket Size and Fo

orecast
Largestpizzachain
nsekeoutggrowth
While pizzza restauran
nts may be losing
l
sales share
s
to otheer restaurantt cuisine form
mats, major pizza
chains, inn aggregate, have continnued to grow
w sales: the top 10 chainns by system
mwide sales grew
revenue by
b 8.8% durring 2009-20011 and by 3.3% during 2010-2011.
wth is weighhted by sizee: four of thhe top five chains
c
(Pizzza Hut, Dom
mino's
Howeverr, sales grow
Pizza, Liittle Caesarss and Papa Murphy's)
M
grrew sales byy at least 100% during 20009-2011. ThirdT
place Pappa John's alsso grew saless, albeit by only
o
6.4%.
Atsmalle
ercompetito
orsexpense
e?
Sales am
mong four off the next fiive, on the other
o
hand, fell during 2009-2011, with only tentht
place Huungry Howiees posting a modest gainn.
Table22
2:Top10PizzzaRestauraantChains,SSystemwide
eSales:2009
92011
20
009
2010
2011
2009-2011
2010-2011
Pizza
a Hut
Domino's Pizza
Papa John's
Little Caesars
Papa Murphy's
$bil
$5
5.00
$3
3.10
$2
2.07
$1.12
$0
0.63
$bil
$5.40
$
$
$3.32
$
$2.10
$
$1.27
$
$0.65
$bil
$5.50
$3.44
$2.20
$1.43
$0.70
% change
10.0%
11.1%
6.4%
27.8%
11.1%
% change
1.9%
3.6%
4.9%
12.4%
7.3%
Califo
ornia Pizza Kitc
chen
Cici's Pizza
Chuck E. Cheese's
Round Table Pizza
Hungry Howie's
$0
0.66
$0
0.56
$0
0.43
$0
0.39
$0
0.26
$0.64
$
$
$0.54
$
$0.42
$
$0.38
$
$0.25
$0.65
$0.52
$0.41
$0.36
$0.27
-2.2%
-8.4%
-4.9%
-9.5%
4.0%
1.2%
-5.2%
-2.6%
-5.3%
6.9%
Top 10 Pizza Chains
$14
4.22
$
$14.97
$15.46
8.8%
3.3%
Source: Packaged Facts

F
Septemberr 2012
26
Pizza at Foo
R
Marrket Size and Fo

orecast
Retailp
pizzamarke
etsizeand
dforecast
Packagedd Facts foreccasts that U..S. frozen annd refrigerated pizza sales will reachh $4.91 billiion in
2012, doown 0.9% from 2011. We forecaast U.S. froozen and reefrigerated pizza
p
2011--2014
compounnd annual gro
owth of -0.1%. These esstimates are unadjusted
u
f inflation.
for
Grraph23:Re
etailPizzaM
MarketSize&
&Forecast,2
20072014
Source: Packaged Facts, based in part on data from Sym

mphony IRI Group
p (used with perm
mission).
ata represents fro
ozen and refrigerrated pizza saless at grocery/supe
ermarkets, mass merchandisers, drug stores,
Note: da
supercen
nters, dollar store
es, club stores and specialty storres.
Frozenp
pizzasalesh
hittingawaall
In 2012, we expect frozen
f
pizzaa sales to reaach $4.58 biillion, or 93.2% of com
mbined sales, with
refrigeratted pizza generating $3330 millionn, or 6.8%. However, refrigerated
r
pizza saless will
outpace those
t
of frozzen pizza, wiith a 2011-20014 CAGR of
o 2.0% verssus -0.2%.
Graph2
24:RetailP
PizzaMarkettSize&Fore
ecast,Frozen
n&RefrigerratedSegme
ents,20072014
Source: Packaged Facts, based in part on data from Sym

mphony IRI Group
p (used with perm
mission).
ata represents fro
ozen and refrigerrated pizza saless at grocery/supe
ermarkets, mass merchandisers, drug stores,
Note: da
supercen
nters, dollar store
es, club stores and specialty storres.
Septemberr 2012
27
Pizza at Foo
R
Marrket Size and Fo

orecast
CPGpizzzasalesatFFDMxtrend
dingdownw
ward
During thhe 52 weekss ending Julyy 8, 2012, frozen
fr
pizza segment salles at FDMxx (food, drugg and
mass, exccluding Wallmart) droppped 2.6% to $3.06 billionn. Frozen pizza sales dippped 2.6%, while
w
frozen piizza crust/do
ough sales roose by 51%.
Refrigeraated pizza seegment saless, on the other hand, rose 7.2% to $2244 million, with pizza//pizza
kits risinng 4.6% to $155
$
millionn and crust/ddough grow
wing 2.6% too $89 millionn. Sales of pizza
products reached $10
00 million, up
u 2.9%, withh pizza saucce growing 2.0%
2
to $67 million.
m
Taable23:CPG
GPizzaSale
es:FrozenPizza,RefrigeratedPizza
&PizzzaProductss,byCatego
ory,20112012
2011
Froze
en pizza
Frozzen pizza
Frozzen pizza crust/dough
Refrig
gerated pizza
Crust/dough
Pizzza/pizza kits
Pizza
a products
Pizzza crust mixes
Pizzza kits/mixes
Pizzza sauce
Total pizza sales
Sa
ales
($
$mil)
2012
20
011-2012
Sales
Share
change
e
change
Sha
are
es
Sale
($mil)
Share
e
$3,141.9
$3,132.2
$
$9.8
90.2%
89.9%
0.3
3%
$3,05
59.0
$3,04
44.3
$14.8
89.9%
%
89.5%
%
0.4%
%
-2.6%
-2.8%
51.1%
-0.3
-0.5
0.2
242.9
$2
$8
85.6
$157.3
7.0
0%
2.5
5%
4.5
5%
$244
4.0
$88.8
$155
5.2
7.2%
%
2.6%
%
4.6%
%
0.5%
3.8%
-1.3%
0.2
0.2
0.0
$9
98.7
$1
11.7
$2
23.1
$6
63.9
2.8
8%
0.3
3%
0.7
7%
1.8
8%
$100
0.2
$12.3
$21.4
$66.6
2.9%
%
0.4%
%
0.6%
%
2.0%
%
1.5%
5.2%
-7.6%
4.2%
0.1
0.0
0.0
0.1
$3,4
483.5
100.0%
$3,40
03.3
100.0%
%
-2.3%
Source: Packaged Facts,

F
based on data
d
from Symph
hony IRI Group (u
used with permisssion). Figures re
epresent sales
atest 52 weeks ending
e
July 8, 20
012.
for la
Septemberr 2012
28
Pizza at Foo
R
Marrket Size and Fo

orecast
Privatellabelgrowsssales,take
esshare
As has been more geenerally the case, privatee label contiinues to grow
w salesannd steal shareein
the pizzaa category. As
A shown in the table beelow, privatee label grew sales in each of three FDMx
retail pizzza segmentss: frozen pizzza, pizza products, and refrigeratedd pizza, and it
i grew its frrozen
pizza andd refrigerated
d pizza saless share.
Table24:CPGPizzaaSales,PrivaateLabelSh
hare,byCate
egory,20112012
Segment and
a subsegme
ent
Pizza
Private Label
ales
Sa
2012 sales
cha
ange
$33
38.9
11
1%
$33
37.0
11
1%
$1.9
379
9%
Pizza ( minus PL)

P
ales
Sa
2012 sales
cha
ange
$2,7
720.1
-4..1%
$2,7
707.3
-4..3%
$12.9
37.4%
2012 sales
s
$3,05
59.0
$3,04
44.3
$14
4.8
Salles
chan
nge
-2.6
6%
-2.8
8%
51.1
1%
Pizza prod
ducts
Pizza crustt mixes
Pizza kits/m
mixes
Pizza saucce
$100
0.2
$12
2.3
$21
1.4
$66
6.6
1.5
5%
5.2
2%
-7.6
6%
4.2
2%
$12
2.9
$1.6
$0
0.3
$11
1.0
2%
%
14
4%
-57
7%
3%
%
$87.3
$10.7
$21.1
$55.6
1.5%
4.0%
-6..0%
4.4
4%
Refrigerate
ed pizza
Crust/doug
gh
Pizza/pizza
a kits
$244
4.0
$88
8.8
$155
5.2
0.5
5%
3.8
8%
-1.3
3%
$10
01.1
$20
0.3
$80
0.8
4%
%
21
1%
0%
%
$14
42.9
$68.5
$74.4
-1..8%
-0..5%
-3..0%
$3,40
03.3
-2.3
3%
$45
52.9
9%
%
$2,9
950.4
-3..9%
Frozen pizzza
Frozen pizzza
Frozen pizzza crust/dough
h
Total
Source: Pa
ackaged Facts, based
b
on data fro
om Symphony IR
RI Group (used with
w permission). Figures represe
ent sales for latesst 52
weeks end
ding July 8, 2012
2.
Private laabel now com

mmands a 13.3% share of retail pizzza sales. Thiis representss a 1.4 percenntage
point shaare increase, on the heells of 9% salees growth. Inn comparisoon, name-braanded pizza sales
declined 3.9%.
Table25:CPGPizzaaSales,PrivaateLabelSh
hare,byCate
egory,20112012
Se
egment and su
ubsegment
Private Label Sh
hare
2011 sh
hare
9.7%
%
9.7%
%
4.0%
%
2012 share
11.1%
11.1%
12.7%
Share point
p
change
1.4
1.4
8.7
Pizzza products
Pizzza crust mixes
s
Pizzza kits/mixes
Pizzza sauce
12.8%
%
11.7%
%
2.6%
%
16.7%
%
12.8%
12.7%
1.2%
16.6%
0.0
1.0
-1.4
-0.1
Re
efrigerated piz
zza
Crrust/dough
Pizzza/pizza kits
40.1%
%
19.6%
%
51.3%
%
41.4%
22.8%
52.1%
1.3
3.3
0.8
To
otal
11.9%
%
13.3%
1.4
Frozen pizza
Fro
ozen pizza
Fro
ozen pizza crust/dough
Source: Package
S
ed Facts, based on
o data from Sym
mphony IRI Grou
up (used with perrmission). Figure
es represent
s
sales
for latest 52
2 weeks ending July
J
8, 2012.
Septemberr 2012
29
Pizza at Foo
R
Marrket Size and Fo

orecast
Retailfrrozenpizzamanufactu
urershare
Among the
t top 12 frozen pizza manufactuurers by salles, significaant growth came only from
boutique companies Newmans Own and Amys Kitcheen, with grew
w pizza salees 37% and 10%,
respectivvely. In aggreegate, sales among the top 12 manufacturers decclined 3.1% for the 52 weeks
w
ending Juuly 8, 2012.
Nestlre
eigns,butsh
hareatNestlandSchw
wandips
During thhis period, Nestl
N
USA
A dominatedd the pizza category
c
W
N
USA to the top of
o this
category,, with $1.38
8 billion in sales. This represents a 45.4% shaare of SympphonyIRI-traacked
salesabbout 26 perrcentage poiints ahead of
o No. 2 Schwan Foodd ($595 miillion and 19.5%
share)bbut down 1.0 percentagge points froom the year-earlier periiod. Schwanns share of sales
dipped 2.3 percentag
ge points.
Tab
ble26:Top12FrozenPizzaManufaacturerSaless,20112012
2
2011
Sales
($m
mil)
Nestl
USA Inc.
Schw
wan Foods Co.
Privatte label
Gene
eral Mills
Pinna
acle Foods Corrp.
Home
e Run Inn
Palermo Villa Inc.
Newm
man's Own Inc..
Amy'ss Kitchen Inc.
Berna
atello's Pizza In
nc.
McCa
ain Foods USA
A Inc.
Kraft Foods Inc.
$1,4
453.5
$68
85.3
$30
04.4
$20
01.2
$72
2.9
$50
0.3
$50
0.4
$33
3.3
$40
0.8
$44
4.3
$37
7.6
$0
0.0
Top 12
2012
20
011-2012
Sales
Share
change
e
change
Sha
are
Sales
($mil)
Share
e
46.4
4%
21.9
9%
9.7%
%
6.4%
%
2.3%
%
1.6%
%
1.6%
%
1.1%
%
1.3%
%
1.4%
%
1.2%
%
0.0%
%
$1,383
3.6
$594.7
$337.0
$203.2
$73.1
$51.2
$49.7
$45.7
$45.0
$44.5
$37.2
$18.1
45.4%
%
19.5%
%
11.1%
%
6.7%
2.4%
1.7%
1.6%
1.5%
1.5%
1.5%
1.2%
0.6%
-4.8%
-13.2%
%
10.7%
1.0%
0.4%
2.0%
-1.3%
37.2%
10.3%
0.6%
-1.2%
-1.0
-2.3
1.4
0.2
0.1
0.1
0.0
0.4
0.2
0.0
0.0
0.6
$2,9
973.9
94.9
9%
$2,883
3.2
94.7%
%
-3.1%
-0.2
Otherr
$15
58.3
5.1%
%
$161.1
5.3%
1.8%
0.2
Total
$3,132.2
100.0
0%
$3,044
4.3
100%
%
-2.8%
0.0

F
based on data
d
from Symph
hony IRI Group (u
epresent sales
e
July 8, 20
012.
for la
Septemberr 2012
30
Pizza at Foo
R
Marrket Size and Fo

orecast
Majorbrandsinde
ecline;grow
wthcominggfromtheb
bottom
As refleccted in the taable below, category
c
grow
wth is bubblling up from
m the bottom,, not the top::
sales amoong the top 15
1 brands (ccounting privvate label as a brand) decclined 3.6% for the 52 weeks
w
ending Juuly 8, 2012.
Excludinng the impactt of private label,
l
sales among
a
the reemaining 14 brands declined by 5.3%
%.
Among the top 10 brrands, only Totinos
T
grew
w sales by att least 1% (33.2%).
Table27:TTop15Froze
enPizzaBrandSales,20
0112012
2011
Sales
($m
mil)
DiGio
orno
$72
28.6
Red Baron
B
Privatte label
Tomb
bstone
Totino
o's
Stoufffer's
Frescchetta
Jack'ss
Califo
ornia Pizza Kitc
chen
Tony's
Celesste
Home
e Run Inn
Palermo
Newm
man's Own
Amy'ss
2012
20
011-2012
Sales
Share
change
e
change
Sha
are
Sales
($mil)
Share
e
23.3
3%
$704.5
23.1%
%
-3.3%
-0.1
$37
76.0
$30
04.4
$24
47.0
$18
86.5
$18
81.2
$18
86.1
$14
47.3
$14
49.3
$12
23.1
$72
2.9
$50
0.3
$50
0.4
$33
3.3
$40
0.8
12.0
0%
9.7%
%
7.9%
%
6.0%
%
5.8%
%
5.9%
%
4.7%
%
4.8%
%
3.9%
%
2.3%
%
1.6%
%
1.6%
%
1.1%
%
1.3%
%
$344.6
$337.0
$228.8
$192.6
$176.6
$156.2
$147.6
$126.1
$93.9
$73.1
$51.2
$49.7
$45.7
$45.0
11.3%
%
11.1%
%
7.5%
6.3%
5.8%
5.1%
4.8%
4.1%
3.1%
2.4%
1.7%
1.6%
1.5%
1.5%
-8.3%
10.7%
-7.4%
3.2%
-2.5%
-16.1%
%
0.2%
-15.5%
%
-23.8%
%
0.4%
2.0%
-1.3%
37.2%
10.3%
-0.7
1.4
-0.4
0.4
0.0
-0.8
0.1
-0.6
-0.8
0.1
0.1
0.0
0.4
0.2
$2,8
877.2
91.9
9%
$2,772
2.6
91.1%
%
-3.6%
-0.8
Otherr
$25
55.0
8.1%
%
$271.7
8.9%
6.5%
0.8
Total
$3,132.2
100.0
0%
$3,044
4.3
100.0%
%
-2.8%
Top 15
1

F
based on data
d
from Symph
hony IRI Group (u
epresent sales
e
July 8, 20
012.
for la
Septemberr 2012
31
Pizza at Foo
R
Marrket Size and Fo

orecast
Retailfrrozenpizzabrands:co
ompanyshaare
As shownn in the tablee below, DiG
Giorno domiinates the froozen pizza aisle,
a
rackingg up $704 million
m
in sales, more than half
h of parennt company Nestls
N
cateegory sales, and almost a quarter off total
category sales. But th
he Red Baroon brand is as
a importantt to Schwans bottom linne as DiGiorrno is
to Nestls, generatin
ng $345 million at FDM
Mx, almost 60%
6
of comppany categorry sales and 11%
of total category
c
salees.
If privatee label brand
ds were one brand, they would geneerate $337 million
m
in FD
DMx sales, giving
g
private laabel third pllace, just beehind Red Baron. Roundding out thee top four, Tombstone
T
taallied
$229 milllion, about 17%
1
of Nesttls categoryy sales, goodd for 8% of total
t
categorry sales.
Taable28:Swe
eet16Froze
enPizzaBran
nds:Sales,SSalesShare,
ParentComp
panySalesSh
hare,2012
Brand
d
Sales
($mil)
Parent co
ompany
Share of pare
ent
company salles
Share of
to
otal sales
DiGio
orno
Red Baron
B
Privatte Label
Tomb
bstone
$704
$345
$337
$229
Nesttl
Schw
wan
Nesttl
51%
58%
NA
17%
23%
11%
11%
8%
Totino
o's
Stoufffer's
Frescchetta
Jack'ss
$193
$177
$156
$148
Schw
wan
Nesttl
Schw
wan
Nesttl
32%
13%
26%
11%
6%
6%
5%
5%
Tony's
Celesste
Home
e Run Inn
Palermo Villa
$94
$73
$51
$50
Schw
wan
Pinnacle Foods
Home Run
R Inn
Palermo
o Villa
16%
100%
100%
100%
3%
2%
2%
2%
Newm
mans Own
Amyss Kitchen
$46
$45
$37
$23
Newmans Own
Amys Kitchen
K
McCain Foods
Kello
ogg
100%
100%
100%
100%
2%
1%
1%
1%
$1,615
$2,288
$2,706
53%
75%
89%
Otherr
$338
11%
Total
$3,044
100%
Ellioss
Kashii
Top 4
Top 8
Swee
et 16

F
based on data
d
from Symph
hony IRI Group (u
epresent sales
e
July 8, 20
012.
for la
Septemberr 2012
32
Pizza at Foo
R
Marrket Size and Fo

orecast
Ontheffasttrack:ffrozenpizzaabrandgro
owthleaderrs
Clearly, the retail piizza market is facing growth
g
challlenges, especially amonng major plaayers.
Howeverr, some (new
w) brands andd line extenssions are buccking that treend:
New producct Totinos Pizza Stuuffers, a poortable opttion aimed at kids for
N
f
a
snnacking/fourrth meal opttion, gainedd during the 52 weeks ending Julyy 8, 2012, hitting
$22.9 million in
i sales.
The Freschettta brand haas taken a new

T
n
approacch in markeeting its frozzen offeringgs by
inntroducing Frescehtta
F
Siimply Inspired and Fresccehtta By Thhe Slice. Acccording to Mary
M
B
Brown,
senio
or director off marketing at Schwan, The Simplyy Inspired pizzas offer largel
cuut vegetablees, sauces annd meats to create new varieties unnseen in this category. They
innclude six varieties: Hawaiian
H
Sttyle, Farmeers Market Veggie, Harvest
H
Suprreme,
Southern BBQ
Q, Rustic Peepperoni Pom
modoro, Classic Bruscheetta and Tusccan Farmhouuse.
The Dr. Oetk

T
ker brand, manufactured
m
d by Europeaan CPG conglomerate Dr.
D Oetker AG,
A is
allso gaining traction,
t
withh sales reachhing $10.2 million.
m
Table29:Sweet1
16FrozenPiizzaGrowth
hBrands&LineExtensio
ons:
Sales&SalesGrowth
h,2012
Bran
nd
Sales ($mil)
Sales growth
Parent co
ompany
Totin
nos Pizza Stufffers
Fresschetta Simply Inspired
Ame
erican Flatbrea
ad
Dr Oetker
O
Ltd
Pale
ermo Classics
New
wmans Own
Pale
ermo
Con
nnies
Pizzza Corner
Gluttino
Bella
atoria
Totin
nos
Heg
ggies
Luciias
Private Label
Amyys
$2.9
$35.0
$2.6
$10.8
$11.8
$45.7
$9.0
$6.0
$3.7
$2.3
$17.4
$23.6
$4.9
$4.1
$337.0
$45.0
1083
353.9%
122
2.3%
95
5.9%
66
6.2%
45
5.7%
37
7.2%
31
1.7%
25
5.9%
21
1.8%
21
1.3%
17
7.5%
16
6.5%
13
3.4%
13
3.0%
10
0.7%
10
0.3%
Generall Mills
Schwan Food
American Flatbread
F
Dr Oetker
Palermo
o Villa
Newmans Own
Palermo
o Villa
Conniess Pizza
Pizza Corner
C
G
Glutino
Importattions Deroma
Bernatellos Pizza
Generall Mills
Heggies Pizza
Lucias Pizza
Private Label
Amys Kitchen
Tota
al
Tota
al - private labe
el
$561.8
$224.8
Othe
er
$2,482.5
5
Tota
al
$3,044.3
3
So
ource: Packaged Facts, based on
n data from Symp
phony IRI Group (used with perm
mission). Figures represent
sales for latest 52 weeks
w
ending Ju
uly 8, 2012.
Septemberr 2012
33
Pizza at Foo
R
Marrket Size and Fo

orecast
Growthdoesnotd
discriminate
eonprice
With an average unit retail pricee of $3.17, frozen
f
pizzass are well within
w
the reaach of houseehold
budgets, which helpss explain the products popularity. However, as
a illustratedd by wide prricing
differencces among th
he fastest grrowing frozeen pizza braands and linee extensionss, consumerss will
support the
t growth of value and premium
p
off
fferings.
Roomforvalueandpremiumgrrowth
The Am
merican Flattbread brannd generatees restaurannt-quality prrestige from
m its restaaurant
namesake, aggressiv
vely weaves all-natural messaging
m
i
into
its markketing platfoorm, and gaarners
strongly positive rev
views toutingg its superioor tasteof which help support a prrice point allmost
200% abbove the rettail average. But room also exists for productts such as Palermo
P
Classics,
value-priiced at 66% of the retail average.
Table2
210:Sweet16FrozenP
PizzaGrowth
hBrands&LLineExtensions:
Sale
es,SalesGro
owth&UnitPricing,201
12
Sales ($mil)
Sales growth
Avg. Unit
A
Price
Indexed
Price
All frrozen pizza
$3,044
-2
2.8%
$3.17
Totin
nos Pizza Stufffers
Fresschetta Simply Inspired
Ame
erican Flatbrea
ad
Dr Oetker
O
Ltd
Pale
ermo Classics
New
wmans Own
Pale
ermo
Con
nnies
Pizzza Corner
Gluttino
Bella
atoria
Totin
nos
Heg
ggies
Luciias
Private Label
Amyys
$2.9
$35.0
$2.6
$10.8
$11.8
$45.7
$9.0
$6.0
$3.7
$2.3
$17.4
$23.6
$4.9
$4.1
$337.0
$45.0
1083
353.9%
122
2.3%
95
5.9%
66
6.2%
45
5.7%
37
7.2%
31
1.7%
25
5.9%
21
1.8%
21
1.3%
17
7.5%
16
6.5%
13
3.4%
13
3.0%
10
0.7%
10
0.3%
$3.44
$5.59
$9.10
$4.04
$2.04
$5.93
$4.64
$5.17
$6.64
$5.55
$4.85
$1.37
$8.18
$3.65
$2.62
$6.51
8
76
187
27
-36
87
46
63
110
75
53
-57
158
15
-17
105
Bran
nd
So
n data from Symp
phony IRI Group (used with perm
mission). Figures represent
sales for latest 52 weeks
w
ending Ju
uly 8, 2012.
Septemberr 2012
34
Pizza at Foo
R
Pizza Us
se by Channel & Type
Chapter3:PizzaU
UsebyChannel&Type
INTROD
DUCTION
In this se
ection, we assess
a
usag
ge penetratiion, usage frequency,
f
a
and
usage share
s
amon
ng 10
pizza pro
ocurement sources/type
s
es: Restaura
ant delivery//pick up; resstaurant dine
e in; buy fro
ozen;
Make at home from
m scratch or kit/mix; buyy fresh/refrig
gerated; gett ready-to-e
eat from a nonrestauran
nt; get from at a sportin
ng/entertainm
ment event; get at a co
ompany cafe
eteria/foodse
ervice
program;; get at a colllege cafeterria/foodservice program; or get from
m a food truckk.
INSIGH
HTCAPSU
ULE
Some 97%
% of respondents eat pizza
p
and ab
bout 93% off respondentts have gotte
en food/drinkk from
a pizza restaurant
r
in
n the past 12
1 months, levels of pe
enetration th
hat at once show how many
people en
njoy pizza an
nd suggest difficulty
d
in growing
g
a co
ommoditized
d market in the face of healthy
eating hea
adwinds.
However, they obtain it from vario
ous sources (i.e. restaurrants, food retailers,
r
spo
orting eventss, etc.)
and in various forms (i.e. hot, frozen, and fre
esh/refrigerated). We bo
oiled this do
own to 10 ch
hoices:
Restauran
nt delivery/p
pick up; resta
aurant dine in; buy froze
en; Make at home from scratch or kit/mix;
k
buy uncooked (fres
sh/refrigeratted); get re
eady-to-eat from a no
on-restauran
nt; get from
m at a
sporting/e
entertainmen
nt event; ge
et at a comp
pany cafeterria/foodservice program; get at a college
c
cafeteria/ffoodservice program; orr get from a food
f
truck.
Among th
hese choices
s, restaurant delivery is the source chosen in the
t last mon
nth by the highest
percentag
ge of consum
mers, 27%, which transslates to roughly 66 million adults age
a 18+. Att 26%,
eating pizzza at a resta
aurant is alsso a popular choice (63 million
m
custo
omers).
In the pa
ast month, on average
e, adult con
nsumers gott pizza 1.75
5 times via
a takeout/de
elivery.
Extrapola
ating from su
urvey results and weavin
ng in populattion estimate
es, this equa
ates to 410 million
m
pizzasa
a 30% share
e of pizzas procured
p
via means cove
ered by our list. Frozen pizza, which
h adult
consumerrs got a mea
an 1.43 times in the pastt month, gen
nerates a 24
4% pizza pro
ocurement sh
hare.
a more like
ely than men
n to have bo
ought pizza frozen
f
or ma
ade it at hom
me from scra
atch or
Women are
a kit/mix, tilting them toward
t
home-based pizzza use.
Pizza procurement in any of its va
arious formss is more like
ely among younger
y
conssumers. How
wever,
this tende
ency become
es more pro
onounced ass the procure
ement metho
od becomess less widelyy used
(at sportin
ng events, fo
or example, or college ca
afeteria/food
dservice prog
grams or fro
om food trucks).
e family dining choices:: Adults with
h children in
n the home are more likkely to
Kids heavvily influence
get pizza from each listed
l
source
e, except forr frozen pizzza and pizza
a takeout/de
elivery. Adultts with
kids at ho
ome are get pizza from each
e
source more freque
ently.
Septemberr 2012
35
Pizza at Foo
R
Pizza Us
Introducction
In this seection, we assess
a
usage penetration, usage freqquency, and usage share among 10 pizza
procurem
ment sourcess/types: Resttaurant delivvery/pick up;; restaurant dine in; buyy frozen; Maake at
home froom scratch or
o kit/mix; buy
b fresh/reffrigerated; get
g ready-too-eat from a non-restauurant;
get from at a sportin
ng/entertainm
ment event; get
g at a com
mpany cafeteeria/foodservvice program
m; get
at a colleege cafeteria//foodservicee program; or get from a food truck.
age 18+ weere asked, In the past month,
In referennce to this list, survey respondents
r
m
how many
m
times havve you eaten
n pizza in the following ways? If yoou have not eaten
e
pizza in
i the past month
m
in a specific way, pleease enter 0.
t
questions, assessiing usage peenetration, usage
u
In this section, we analyze the results to these
frequencyy, and usagee share (in many
m
cases weighting
w
usaage share byy population)).
Universaallyaccepte
ed
Some 977% of respo
ondents eatt pizza, a level
l
of pennetration thaat at once shhows how many
m
people acccept it and suggests
s
diff
fficulty in groowing a com
mmoditized market.
m
Nearuniversaluseofpizzare
estaurants
Similarlyy, about 93%
% of responddents have gotten
g
food/ddrink from a pizza restaaurant in thee past
12 monthhs. Clearly, people
p
like pizza.
p
But aggainst healthhy eating heaadwinds, groowing the nuumber
of pizza eating
e
occassions may prrove difficultt.
Septemberr 2012
36
Pizza at Foo
R
Pizza Us
Pizzaussagepenettrationand
dpopulatiionuniversse
While allmost everyo
one eats pizzza, they obbtain it from
m various soources (i.e. restaurants, food
retailers, sporting events, etc.) annd in variouus forms (i.e. hot, frozenn, and fresh/rrefrigerated)). We
frame theese sources and
a forms innto 10 surveyy responses, highlighted in the tabless below.
Higherusagepenetrrationamon
ngrestaurantdineinand
ddeliveryth
hanfrozenp
pizza
Among these
t
10 choices, restaurrant delivery is the sourcce chosen in the last monnth by the highest
mers, 27%, which
w
transllates to rougghly 66 milliion adults agge 18+. At 26%,
eating pizzza at a restaaurant is alsoo a popular choice.
c
In compaarison, 24% of consumeers have bought frozen pizza
p
in the past
p month, while 12% made
m
it at hom
me from scrattch or a kit/m
mix.
Tab
ble31:PizzzaUsagePen
netrationan
ndPopulatio
onUniverse,,
byyDistributio
onChannel//PizzaType
Consum
mers who have
e gotten pizza in
n the following ways in past month:
m
Delivere
ed/picked up frrom any restaurant
Eaten at
a any restaurant
Bought frozen
Made at
a home from sc
cratch or kit/mix
Bought uncooked (frresh/refrigerate
ed)
Ready-tto-eat from non
n-restaurant
At sportting/entertainm
ment event
At comp
pany cafeteria//company foodservice program
At college cafeteria/co
ollege foodservvice program
From a food truck
Usage
penetration
Population
n
universe
% off population
millions
27%
26%
24%
12%
11%
8%
7%
4%
3%
2%
65.9
63.3
56.7
29.3
26.0
18.1
15.9
9.0
6.9
5.6
Source
e: Packaged Fac
cts, based on datta from August 2012
2
proprietary survey
s
of 2,000 respondents
r
age
e 18+; Population
n
Univerrse calculations incorporate 2012
2 population foreccasts based on 2011
2
U.S. U.S. Census
C
data
Respo
ondents were ask
ked the following question: In the
e past month, ho
ow many times ha
ave you eaten piizza in the follow
wing
ways?
? If you have not eaten pizza in th
he past month in a specific way, please
p
enter 0.
Septemberr 2012
37
Pizza at Foo
R
Pizza Us
Takeout//deliveryop
ptionusedm
mostfrequen
ntly
In the past
p
month, on averagee, adult connsumers got pizza 1.75 times via takeout/deliivery.
Extrapolaating from survey resuults and weaaving in poopulation esttimates, thiss equates too 410
million pizzasa
p
30
0% share off pizzas proccured via means
m
covereed by our liist. Frozen pizza,
p
which addult consum
mers got a mean 1.43 times in thhe past monnth, generattes a 24% pizza
p
procurem
ment share.
Morethaanhalfofallpizzasarettakeout/delliveryorfrozen
In aggreggate, this meeans about 54%
5
of pizzas covered by
b our list are
a gotten takkeout/deliveery or
frozen (O
Of course, ou
ur methodoloogy is meantt to provide rough guidaance and is not
n intended to be
a tested and
a true sharre methodoloogy).
Table
e32:PizzaUsageFrequ
uency,PizzaasEatenand
dUsageSharre,
byyDistributio
onChannel//PizzaType
Pizzas gotten
g
in the fo
ollowing ways in
i past month:
Delivere
ed/picked up frrom any restaurant
Bought frozen
Eaten at
a any restaurant
Made at
a home from sc
cratch or kit/mix
Bought uncooked (frresh/refrigerate
ed)
Ready-tto-eat from non
n-restaurant
At sportting/entertainm
ment event
At comp
pany cafeteria//company foodservice program
At college cafeteria/co
ollege foodservvice program
From a food truck
Total
Mean use
Pizzas
Usage
share
millions
1.75
1.43
0.88
0.45
0.39
0.35
0.20
0.18
0.14
0.11
410
335
205
106
91
83
46
42
33
27
30%
24%
15%
8%
7%
6%
3%
3%
2%
2%
1,378
100%
Source
e: Packaged Fac
2
proprietary survey
s
of 2,000 respondents
r
age
e 18+; Pizza unit
calcula
ations incorporatte 2012 populatio
on forecasts base
ed on 2011 U.S. U.S. Census da
ata.
Respo
ondents were ask
ked the following question: In the
e past month, ho
ow many times ha
ave you eaten piizza in the follow
wing
ways?
? If you have not eaten pizza in th
he past month in a specific way, please
p
enter 0.
Septemberr 2012
38
Pizza at Foo
R
Pizza Us
Genderranalysis:w
womentillttohome
ebasedpizzzasourcess/types
ype or sourcce, the frequuency with which men and womenn obtain pizzza is
Regardleess of the ty
roughly similar.
s
Howeverr, women aree more likelyy than men to
t have bougght pizza froozen or madee it at home from
scratch or
o a kit/mix, tilting them toward hom
me-based pizza use. Menn, on the otheer hand, are more
likely to get pizza at
a a sportingg/entertainm
ment event, at
a a college cafeteria/colllege foodse
ervice
program,, or from a fo
ood truck.
Table3
33:PizzaUssage&Usagge,byDistrib
butionChan
nnel/PizzaTyype:
Gen
nderAnalysiis
Usage
U
D
Delivered/picke
ed up from any restaurant
E
Eaten
at any re
estaurant
B
Bought
frozen
M
Made
at home from
f
scratch or kit/mix
B
Bought
uncook
ked (fresh/refrrigerated)
R
Ready-to-eat
from non-restaurant
A sporting/ente
At
ertainment event
A company caffeteria/compan
At
ny foodservice program
A college cafetteria/college foodservice prog
At
gram
F
From
a food tru
uck
All
27%
26%
24%
12%
11%
8%
7%
4%
3%
2%
Male
100
102
94
91
105
102
120
103
110
113
Female
100
99
105
107
96
98
84
98
91
89
Mean usage
M
D
Delivered/picke
ed up from any restaurant
E
Eaten
at any re
estaurant
B
Bought
frozen
M
Made
at home from
f
scratch or kit/mix
B
Bought
uncook
ked (fresh/refrrigerated)
R
Ready-to-eat
from non-restaurant
A sporting/ente
At
ertainment event
A company caffeteria/compan
At
ny foodservice program
A college cafetteria/college foodservice prog
At
gram
F
From
a food tru
uck
All
1.8
0.9
1.4
0.5
0.4
0.4
0.2
0.2
0.1
0.1
Male
1.8
0.9
1.4
0.4
0.4
0.4
0.2
0.2
0.2
0.2
Female
1.7
0.8
1.4
0.5
0.4
0.3
0.2
0.1
0.1
0.1
Source: Packag
ged Facts, based
d on data from August
A
2012 prop
prietary survey
Base: 1,947 res
spondents who eat
e pizza
Respondents were
w
asked the fo
ollowing question
n: In the past mo
onth, how many times
t
have you eaten
e
pizza
in the following ways? If you ha
ave not eaten pizzza in the past mo
onth in a specificc way, please enter 0.
Septemberr 2012
39
Pizza at Foo
R
Pizza Us
Ageanaalysis:Prep
paredfood
dsrelation
nshiptothesupermaarketbaskket
As illustrrated by thee table below
w, pizza procurement inn any of its various
v
form
ms is more likely
l
among younger
y
co
onsumers. However,
H
thhis tendency becomes more pronounced ass the
procurem
ment method
d becomes less
l
widely used (at spporting evennts, for exam
mple, or coollege
cafeteria//foodservicee programs or
o from food trucks).
Takeout//delivery and
d frozen pizzza are not onnly most oftten chosen, but
b frequenccy also decrreases
as consuumers age. Frequency
F
of use declinnes with agee, with one exception: eating
e
pizzaa at a
restaurannt is most oftten done by 25-44s.
Table3
34:PizzaUssage&Usagge,byDistrib
butionChan
nnel/PizzaTyype:
AggeAnalysis
Usage
Delivered/p
picked up from any restaurantt
Eaten at an
ny restaurant
Bought frozzen
Made at ho
ome from scratch or kit/mix
Bought un
ncooked (fresh
h/refrigerated)
Ready-to-e
eat from non-re
estaurant
At sporting/entertainmentt event
At company cafeteria/food
dservice prgm
At college cafeteria/foods
c
service program
m
From a foo
od truck
All
27%
26%
24%
12%
11%
8%
7%
4%
3%
2%
18-24
101
125
112
147
139
162
163
238
408
284
25-34
2
97
118
98
132
136
160
163
183
182
255
35-4
44
98
102
2
90
114
4
96
99
129
9
100
0
83
81
45-54
109
95
113
82
83
71
77
55
45
44
55-64
105
95
97
88
87
66
76
75
11
14
65+
89
76
92
60
80
73
22
16
0
13
Mean usag
ge
Delivered/p
picked up from any restaurantt
Eaten at an
ny restaurant
Bought frozzen
Made at ho
ome from scratch or kit/mix
Bought un
ncooked (fresh
h/refrigerated)
Ready-to-e
eat from non-re
estaurant
At sporting/entertainmentt event
At company cafeteria/food
dservice prgm
At college cafeteria/foods
c
service program
m
From a foo
od truck
All
1.8
0.9
1.4
0.5
0.4
0.4
0.2
0.2
0.1
0.1
18-24
2.5
1.2
2.0
0.8
0.8
0.7
0.4
0.5
0.4
0.2
25-34
2
2.2
1.3
1.7
0.7
0.6
0.6
0.4
0.4
0.3
0.3
35-4
44
1.9
9
0.9
9
1.8
8
0.5
5
0.4
4
0.4
4
0.2
2
0.2
2
0.1
0.1
45-54
1.6
0.8
1.4
0.3
0.3
0.2
0.1
0.1
0.1
0.1
55-64
1.4
0.7
1.0
0.3
0.2
0.2
0.1
0.1
0.0
0.0
65+
1.1
0.5
1.0
0.2
0.2
0.2
0.0
0.0
0.0
0.0
Source: Pa
b
on data fro
om August 2012
2 proprietary survvey
Base: 1,94
47 respondents who
w eat pizza
Responde
ents were asked the
t following que
estion: In the pa
ast month, how many
m
times have you eaten pizza in the following ways?
w
If you have
e not eaten pizza
a in the past mon
nth in a specific way,
w
please ente
er 0.
Septemberr 2012
40
Pizza at Foo
R
Pizza Us
HHincome
Pizza prrocurement method diiffers dramaatically by HH incom
me: Restaurrant, frozen and
scratch/m
mixes most apt to be used by middle
m
HH--income connsumers; uppper HH-inccome
consumers are most apt
a to get pizzza at a sporrting event; and low HH
H-income connsumers are most
apt to gett it at a colleege foodservvice program
m or food trucck.
Howeverr, the frequen
ncy with whhich consumeers get pizzaa via these methods
m
is roughly uniforrm.
Table
e35:PizzaU
Usage&Usaage,byDistrributionChaannel/PizzaTType:HHIncomeAnalyysis
Usage
Delivered
d/picked up from any restaura
ant
Eaten at any restaurantt
Bought frrozen
Made at home from scrratch or kit/mix
Bought u
uncooked (fresh/refrigerated
d)
Ready-to
o-eat from non--restaurant
At sportin
ng/entertainme
ent event
At compa
any cafeteria/fo
oodservice prog
gram
At college
e cafeteria/food
dservice progra
am
From a fo
ood truck
All
27%
26%
24%
12%
11%
8%
7%
4%
3%
2%
<$25K
97
78
95
82
94
93
71
79
163
129
$25K$49.9K
107
103
102
94
105
105
86
108
109
72
$50K$74.9K
$
94
105
98
129
102
123
89
110
54
67
75K$7
$9
99.9K
109
118
109
114
101
72
140
146
73
127
$100
0K+
94
11
10
99
91
96
95
15
52
69
68
12
26
Mean us
sage
Delivered
ant
Bought frrozen
Bought u
uncooked (fresh/refrigerated
d)
Ready-to
At sportin
ng/entertainme
ent event
At compa
any cafeteria/fo
oodservice prog
gram
At college
e cafeteria/food
dservice progra
am
From a fo
ood truck
All
1.8
0.9
1.4
0.5
0.4
0.4
0.2
0.2
0.1
0.1
<$25K
1.7
0.7
1.6
0.6
0.5
0.4
0.2
0.2
0.2
0.1
$25K$49.9K
1.6
0.8
1.4
0.4
0.3
0.4
0.2
0.1
0.1
0.1
$50K$74.9K
$
1.7
0.9
1.3
0.5
0.4
0.3
0.2
0.2
0.1
0.1
75K$7
$9
99.9K
1.9
1.0
1.5
0.4
0.3
0.3
0.2
0.2
0.1
0.1
$100
0K+
2..0
1..2
1..3
0..4
0..5
0..4
0..3
0..2
0..2
0..2
Source: Packaged Facts, based on data frrom August 2012

Base: 1,94
47 respondents who
w eat pizza
Responde
ents were asked the following que
estion: In the pa
ast month, how many
m
times have you eaten pizza
a in the following ways?
If you have not eaten pizza
a in the past mon
nth in a specific way,
w
please ente
er 0.
Septemberr 2012
41
Pizza at Foo
R
Pizza Us
Presenceofchildre
en
Kids heaavily influencce family dinning choicess, a point driiven home by the data inn the table beelow:
Adults with
w children in the homee are more liikely to get pizza from each
e
listed source,
s
exceppt for
frozen piizza and pizzza takeout/delivery. Aduults with kids at home arre get pizza from each soource
more freqquently.
Table36:P
PizzaUsage&
&Usage,byyDistributio
onChannel/P
PizzaType:P
Presence
o
ofChildren
Usage
Delivered/pic
cked up from an
ny restaurant
Eaten at any restaurant
Bought frozen
Made at hom
me from scratch
h or kit/mix
Bought unco
ooked (fresh/re
efrigerated)
Ready-to-eatt from non-restaurant
At sporting/entertainment event
At company cafeteria/foods
c
service program
m
At college ca
afeteria/foodserrvice program
From a food truck
All
27%
26%
24%
12%
11%
8%
7%
4%
3%
2%
No kids
103
92
101
82
88
80
55
59
68
63
Kids
9
95
11
13
9
99
12
27
11
18
13
30
16
68
16
62
14
48
15
57
Mean usage
e
Delivered/pic
cked up from an
ny restaurant
Eaten at any restaurant
Bought frozen
Made at hom
me from scratch
h or kit/mix
Bought unco
ooked (fresh/re
efrigerated)
Ready-to-eatt from non-restaurant
At sporting/entertainment event
At company cafeteria/foods
c
service program
m
At college ca
afeteria/foodserrvice program
From a food truck
All
1.8
0.9
1.4
0.5
0.4
0.4
0.2
0.2
0.1
0.1
No kids
1.4
0.7
1.2
0.4
0.3
0.3
0.1
0.1
0.1
0.1
Kids
2.2
1.1
1.8
0.6
0.5
0.5
0.4
0.3
0.2
0.2
Source: Packa
aged Facts, base
ed on data from August
A
2012 prop
prietary survey
Base: 1,947 re
espondents who eat pizza
Respondents were
w
asked the following
f
question: In the past month, how many times have you eaten
pizza in the following ways? If you
y have not eatten pizza in the past
p
month in a specific
s
way, plea
ase enter
0.
Septemberr 2012
42
Pizza at Foo
R
Pizza Us
Populationdensityy
For mostt pizza proccurement meethods, subuurban consum
mers are outt in front, exxcept for coollege
foodservice program
ms and food trrucks (whichh is still an overwhelmin
o
ngly urban phenomenon)).
But by frrequency off use, urban dwellers
d
leaad suburban and rural coonsumers, geetting pizza more
often from
m most choiices listed.
Table
e37:PizzaU
Usage&Usaage,byDistrributionChaannel/PizzaTType:PopulationDensitty
Usage
All
Urba
an
27%
%
26%
%
24%
%
12%
%
11%
%
8%
%
7%
%
4%
%
3%
%
2%
%
96
91
79
99
95
108
8
110
0
104
4
136
6
177
7
Mean us
sage
All
Urba
an
Delivered
ant
Bought frrozen
Bought u
uncooked (fresh/refrigerated)
Ready-to
At sportin
ng/entertainme
ent event
At compa
any cafeteria/fo
oodservice prog
gram
At college
e cafeteria/food
dservice progra
am
1.8
8
0.9
9
1.4
4
0.5
5
0.4
4
0.4
4
0.2
2
0.2
2
0.1
1
0.1
1
1.9
9
1.1
1.6
6
0.5
5
0.5
5
0.5
5
0.3
3
0.3
3
0.2
2
0.2
2
Delivered
ant
Bought frrozen
Bought u
uncooked (fresh/refrigerated)
Ready-to
At sportin
ng/entertainme
ent event
At compa
any cafeteria/fo
oodservice prog
gram
At college
e cafeteria/food
dservice progra
am
From a fo
ood truck
From a fo
ood truck
Suburban/Outer
S
Suburbs
108
106
110
101
107
107
122
119
99
92
Suburban/Outer
S
Suburbs
1.8
0.8
1.3
0.4
0.4
0.3
0.2
0.2
0.1
0.1
Rural
87
97
104
99
90
70
30
47
52
11
Rural
1.6
0.7
1.5
0.4
0.3
0.3
0.1
0.1
0.1
0.1
Source: Packaged Facts, based

b
on data from August 2012
Base: 1,94
47 respondents who
w eat pizza
Responde
estion: In the pa
ast month, how many
m
times have you eaten pizza in the following
ways? If you
y have not eate
en pizza in the pa
ast month in a sp
pecific way, please enter 0.
Septemberr 2012
43
Pizza at Foo
R
Food Consum
mption & Migrattion Trends: Pla
acing Pizza in Context
Chapter4:FoodConsu
umption&M
MigrationTrrends:Placin
ngPizzainContext
INTROD
DUCTION
In this se
ection, Pack
kaged Factss analyzes self-reported
s
d consumption trends in
n 17 foods/ffood
types, in
ncludingIntro
restoduction
taurant pizzza, frozen pizza, fresh/rrefrigerated pizza, healtthy food, ho
ome
cooked meals, snac
cks, leftoverrs, beef, Hiispanic/Latin
no foods, fissh/seafood, chicken, sm
mall
portions, on-the-go
rant
foods,
f section,
foods
ss with
less
at, foods
wi2thproprietary
natural in
ngredients,
osurvey,
restau
In th
his
as
part of
itsfa
A
August
2012
y consumer other
s
Packkaged
food and
d prepared
fo
ood.
Facts
s analyzes consumption
c
n trends in 17 foods/food types, including restaaurant
INSIGH
HTCAPSU
ULE
Our surve
ey results su
uggest a cle
ear food consumption tre
end toward healthier op
ptions and ho
omebased cost savings, at the expense of pizza
a: With resp
pect to the 17
1 foods and food types we
asked ab
bout, consum
mers are most likely to
o be eating
g more of those
t
with stronger
s
general
health atttributes and with hom
me-based cost
c
savingss. Unfortun
nately for pizza
p
purveyors,
consumerrs are less likely to be eating
e
more pizza, whether its resta
aurant pizza,, frozen pizzza, or
fresh/refrigerated pizz
za.
The messsage to pizz
za purveyorss is clear: enhance
e
the
e overall hea
althfulness of
o your pizzza, at
least incre
ementally, and
a experiment with opttions providing more cle
ear-cut healtthfulness witthout
sacrificing
g taste.
We found
d that a net positive 28%
% of respon
ndents are eating
e
more healthy foo
od over the past
few yearss. Foods wiith healthier profiles (su
uch as chickken, food witth less fat, food
f
with na
atural
ingredientts, and sma
all portions) also have a positive ne
et differentia
al. Restaura
ant pizza, frrozen
pizza and
d fresh/refrig
gerated pizza, on the otther hand, each
e
receive
e negative n
net differenttials,
with a net percenta
age of the population eating lesss restaurant pizza, fro
ozen pizza, and
za.
Only 4 of 27 listed de
emographic groups
g
are eating
e
more restaurant pizza than they
t
were a
a few
years ago
o: 18-24s, 25-34s,
2
students, and co
onsumers with
w kids in th
he household. Unfortuna
ately,
the tende
ency among
g these grou
ups to eat more pizza is defined by their resspective life
estyle
stages; once
o
these consumers pass these
e life stages, they will likely eat less pizza. The
question is whether notable
n
grou
ups pulling back on resstaurant pizzza use (i.e. black and white
w
consumerrs, suburban
n consumerss, and wome
en) can be enticed to revverse the tre
end.
As for frozzen pizza, th
he situation is more dire
e: Not one off 27 demogrraphic group
ps listed is eating
more frozzen pizza th
han they were a few ye
ears ago. Those
T
least apt
a to do so
o include mid
d- toupper-income consum
mers, wome
en, consume
ers with no kids
k
in the home,
h
Asian
n consumerss and
white con
nsumers. Th
he central isssue here, in
n our view, concerns pizza
p
healthffulness. Women,
who are more health
h-conscious than men and
a
are mo
ore often the
e ones stoccking the kittchen
pantry, arre probably gravitating to
t choices th
hey perceive
e as healthier for themsselves and/o
or for
their families. Those with higher incomes are
e also generrally more health aware, and they are
a in
a better position
p
to pa
ay more for foods
f
that de
eliver on qua
ality, taste and healthfulness.
On a net basis, not on
ne of 27 dem
mographic groups listed is eating mo
ore fresh/refrigerated pizza
p
than theyy were a few
w years ag
go. Howeverr, a silver lin
ning of sortss exists. Re
esearch from
m our
other rep
ports show
w that high
her-income and urban
n consumers are mo
ore apt to eat
za. On a ne
et basis, $10
00K+ HH inccome consu
umers and urban
u
consumers
are eating
g less fresh//refrigerated
d pizza; how
wever, the ne
et differentia
als (-9 and -10, respectively)
are among the smalle
est of all dem
mographics listed.
l
Septemberr 2012
44
Pizza at Foo
R
Food Consum
pizza, froozen pizza, fresh/refriger

f
rated pizza.
Specificaally, we askeed survey reespondents age
a 18+ the following question:
q
Pllease look at
a the
list of fooods below. Compared
d to a few years
y
ago, are
a you eatiing more, leess, or the same
s
amount of these foo
ods or food preparation
n methods?? If you havve not eaten
n a listed foood or
used a listed food method
m
at alll in the pastt few years, please mark does not apply.
Consumeers could resspond by chooosing one of
o the follow
wing responsees:
II eat this mo
ore than I didd a few yearss ago.
II eat this less than I did a few years ago.
a
II eat this abo
out the samee as I did a feew years agoo.
T
This does no
ot apply to me.
m
As folloows, we analyze the results

r
to thhese questioons, to provvide guidannce pizza-reelated
consumpption trends within
w
the coontext of othher foods/foood types.
Trendto
owardhealthieroptionsandawaayfrompizzza
Our survvey results su
uggest a cleaar trend towaard healthierr options andd home-based cost savings, at
the expennse of pizza::
With respect to the 17 fooods and foodd types we asked

W
a
about, consumers are most likeely to
be eating more
m
of thosse with stronnger generaal health attrributes and with
w home-bbased
coost savings.
Unfortunately
U
y for pizza purveyors, consumers are
a less likeely to be eaating more pizza,
p
w
whether
its reestaurant pizzza, frozen piizza, or freshh/refrigerateed pizza.
etopizzapurveyors
Message
o pizza purvveyors: enhaance the oveerall healthfuulness of yoour pizza, at least
The clearr message to
incremenntally, and experiment with optionns providingg more cleaar-cut healthhfulness wiithout
sacrificinng taste.
ph41:FoodConsumptio
onTrends:EEatingMore
e,Same&Le
ess
Grap
Septemberr 2012
45
Pizza at Foo
R
Food Consum
Sou
urce: Packaged Facts,
F
based on data from February 2012 proprie
etary survey
Basse: 2,000 respondents age 18+
Resspondents were asked
a
the following question: Co
ompared to a few
w years ago, are you eating more
e, less, or the
sam
me amount of the
ese foods or food
d preparation me
ethods? If you have not eaten a lissted food or used
d a listed food
metthod at all in the past few years, please
p
mark doe
es not apply.
Septemberr 2012
46
Pizza at Foo
R
Food Consum
Aquestiionofrelevvance
Survey reespondents were
w given the
t option too say that a particular
p
foood or food tyype did not apply
a
to them. For the purp
poses of anallyzing the suurvey resultss, we frame use
u accordinng to relevannce:
a not relevvant to that to

t that consuumer;
Foods that a consumer beelieves do not apply are
u those fooods. Conveersely, if thiis box is lefft uncheckedd, the
thhat consumeer does not use
foood/food typ
pe is relevantt to that conssumer, and the
t consumeer uses that food/food
fo
typpe.
Restauraantpizza,ho
omecookedmeals,lefto
overshighlyrelevant
Using thiis method of interpretation, we see that home cooked
c
mealls are relevant to virtuallly all
(97%) off consumerss. Other higghly relevannt food choiices includee leftovers, restaurant pizza,
p
chicken, snacks and other
o
food chhoices highllighted in greeen.
Prepared
dfoods,Hisp
panic/Latino
ofoodsafresh/refrigeraatedpizzale
eastrelevantt
Among the included
d 17 foods and food types, prepared foods, Hispanic/L
Latino foodss and
fresh/refrrigerated pizzza are least relevant.
Grraph42:Foo
odConsump
ptionTrendss:ConsumerrRelevance
Sou
F
etary survey
a
ompared to a few
e, less, or the
sam
me amount of the
ese foods or food
d preparation me
d a listed food
p
mark doe
es not apply.
Septemberr 2012
47
Pizza at Foo
R
Food Consum
Nettingitout
Consumeers were ask
ked if they were
w
eating more,
thee same or less of the listed foods/food

types, orr if the food//food type did
d not applyy to them. Here,
H
we foccus only on eating
less and
eating more
m
respo
onses, to gaauge food consumption
c
n trend moomentum. We subtracct the
percentagge of respo
ondents whoo are eatingg more of a food/food type by thhe percentagge of
respondeents eating leess of a foodd/food/type. A positive difference represents
r
thhe net percenntage
of consum
mers eating more; a negative differeence represennts the net peercentage eaating less.
withhealthierprofiles;netnegative
e:pizza,pizzzaandpizzaa
Netposittive:foodsw
Applyingg this method
d, we find thhat:
Healthy food receives the highest positive diff

fferential, wiith a net 28%
% of respondents
H
eaating more healthy
h
food over the paast few yearrs. Foods with
w healthierr profiles (suuch as
chhicken, food
d with less faat, food withh natural inggredients, and small porttions) also have a
positive net differential.
d
All three pizzza referencees, on the otther hand, reeceives negaative differenntials, with a net
A
percentage of
o the poppulation eaating less restaurant pizza, frozzen pizza, and
frresh/refrigerated pizza.
Grraph43:FoodConsump
ptionTrendss:Momentu
umAnalysis
Sou
F
etary survey
a
ompared to a few
e, less, or the
sam
me amount of the
ese foods or food
d preparation me
d a listed food
p
mark doe
es not apply.
Septemberr 2012
48
Pizza at Foo
R
Food Consum
Restaurrantpizza:netnegativve,withexcceptionofyyouth
On a net basis, only 4 of 27 listedd demographhic groups are
a eating moore restaurannt pizza thann they
were a few
f years ag
go: 18-24s, 25-34s, studdents and connsumers withh kids in thee household.
Unfortunnately, the teendency amoong these grooups to eat more
m
pizza is
i defined byy their respeective
lifestyle stages; oncee these consuumers pass these life stages, they will
w likely eaat less pizza. The
question is whether notable grooups pulling back on restaurant pizzza use (i.e. black and white
w
consumers, suburban
n consumers,, and womenn) can be entticed to reveerse the trendd.
Tab
ble41:FoodConsumpttionTrends::
EatingMore
E
eRestauranttPizza:Dem
mographicAsssessment
Demogrraphic
R
Restaurant
piizza
All
-9%
Age 25-34
Age 18-24
Student
1+ kids
Asian
Hispanic
c
Urban
Work F/T
Work P//T
Male
$100K+
$75K-$9
99.9K
Homemaker
Black
<$25K
35-44
Suburba
an/outer subu
urbs
$25K-$4
49.9K
White
$50K-$7
74.9K
Female
45-54
No kids
Rural
Age 65+
+
Retired
Age 55-64
13%
9%
9%
1%
1%
0%
-1%
-2%
-4%
-5%
-6%
-6%
-7%
-8%
-9%
-9%
-9%
-9%
-11%
-11%
-11%
-11%
-15%
-18%
-19%
-19%
-25%
Source: Packaged Facts, based

b
on data from August 2012
Base: 2,00
00 respondents age
a 18+
Responde
estion: Compare
ed to a few yearss ago, are you ea
ating
more, less
s, or the same am
mount of these fo
oods or food prep
paration methodss? If you have no
ot
eaten a lis
sted food or used
d a listed food me
ethod at all in the
e past few years,, please mark do
oes not
apply.
Septemberr 2012
49
Pizza at Foo
R
Food Consum
Frozenp
pizzatrendmoredire::netnegatiiveamongallanalyzeddemograaphics
As for froozen pizza, the situationn is more dirre: On a net basis, not onne of 27 dem
mographic grroups
listed is eating moree frozen pizzza than theyy were a feew years aggo. Those leeast apt to do
d so
include midm to-uppeer-income coonsumers, women,
w
conssumers withh no kids in the home, Asian
A
consumers and white consumeers. The central
c
issue here, in our view, concerns pizza
p
ulness. Wom
men, who aree more healtth-consciouss than men and are morre often the ones
healthfu
stocking the kitchen
n pantry, aree probably gravitating
g
too choices thhey perceivee as healthieer for
themselvves and/or th
heir families. Those wiith higher incomes are also generally more health
h
aware, and
a are in a better posiition to payy more for foods
f
that deliver
d
on quality,
q
tastee and
healthfullness.
Tab
ble42:FoodConsumpttionTrends::
EatingMo
oreFrozenPizza:DemoggraphicAsse
essment
Demogra
aphic
All
Homema
aker
1+ kids
45-54
Hispanic
Student
<$25K
Age 25-3
34
$25K-$49
9.9K
Male
Black
Urban
Suburban
n/outer suburrbs
18-24
Work F/T
T
Age 55-6
64
Age 35-4
44
Work P/T
T
White
Female
$50K-$74
4.9K
$100K+
Rural
Asian
No kids
Retired
Age 65+
$75K-$99
9.9K
Frozen pizzza
-10%
-6%
-7%
-7%
-7%
-7%
-8%
-9%
-9%
-9%
-9%
-10%
-10%
-10%
-10%
-10%
-11%
-11%
-11%
-11%
-11%
-12%
-12%
-12%
-13%
-13%
-15%
-15%
Source: Pa
ackaged Facts, based on data fro
om August 2012 proprietary
p
surve
ey
Base: 2,000
0 respondents ag
ge 18+
Responden
nts were asked th
he following quesstion: Compared
d to a few years ago, are you eatting
more, less, or the same am
mount of these foo
ods or food preparation methods? If you have nott eaten
d food method att all in the past fe
ew years, please
e mark does not apply.
a listed food or used a listed
Septemberr 2012
50
Pizza at Foo
R
Food Consum
Refrigerratedpizza::netnegatiive,evenamongcoreusers
As is the case with frrozen pizza, on a net bassis, not one of
o 27 demoggraphic groupps listed is eating
e
more fressh/refrigeratted pizza thaan they were a few yearrs ago.
Howeverr, a silver lin
ning of sorts exists. Reseearch from our other repoorts show thhat higher-inccome
and urbaan consumerrs are more apt to eat frresh/refrigerrated pizza. On a net baasis, $100K+
+ HH
income consumers
c
an
nd urban connsumers are eating less fresh/refrige
f
erated pizza; however, thhe net
differentiials (-9 and -10,
- respectiively) are am
mong the smaallest of all demographic
d
cs listed.
Table43:FoodConssumptionTre
ends:EatinggMore
Fresh/ReffrigeratedPizza:DemoggraphicAssessment
De
emographic
All
A
45
5-54
$1
100K+
Urban
$5
50K-$74.9K
Retired
Ag
ge 18-24
Work
W
F/T
1+
+ kids
White
W
Fe
emale
Ag
ge 65+
Black
No kids
Sttudent
Male
M
Hispanic
Suburban/Oute
er Suburbs
<$
$25K
35
5-44
25
5-34
$2
25K-$49.9K
Work
W
P/T
As
sian
$7
75K-$99.9K
55
5-64
Rural
Homemaker
Frresh/refrigerrated pizza
-13%
%
-9%
%
-9%
%
-10%
%
-11%
%
-11%
%
-12%
%
-12%
%
-13%
%
-13%
%
-13%
%
-13%
%
-13%
%
-13%
%
-14%
%
-14%
%
-14%
%
-14%
%
-14%
%
-15%
%
-15%
%
-15%
%
-16%
%
-16%
%
-16%
%
-16%
%
-17%
%
-17%
%
So
ource: Packaged
d Facts, based on
n data from Augu
ust 2012 propriettary survey
Ba
ase: 2,000 respo
ondents age 18+
Re
espondents were
e asked the follow
wing question: C
Compared to a fe
ew years ago,
are you eating more, less, or the sa
ame amount of these foods or food preparation
ethods? If you ha
ave not eaten a listed
l
food or use
ed a listed food method
m
at all in
me
the
e past few yearss, please mark do
oes not apply.
Septemberr 2012
51
Pizza at Foo
R
Menu Trends & Retail New Pro

oducts
Chapter5TheConsumer:PizzaaMenuTren
nds&RetailNewProducts
INTROD
DUCTION
In this se
ection, Packa
aged Facts assesses pizza
p
menu trends,
t
focu
using on menu item pen
netration
and men
nu item incid
dence by re
estaurant se
egment, inccluding top proteins,
p
ing
gredients, cheeses,
c
sauces, varieties,
v
kid
ds menus, and
a health marketing
m
cla
aims. Menu item data iss provided courtesy
c
of Datasssential, a lea
ading food re
esearch com
mpany.
INSIGH
HTCAPSULE
Pizzas po
opularity is underscored by its prevalence on U.S
S. restauran
nt menus, with more than
n onethird featu
uring pizza as
a an entr
e on the menu,
m
including 1 in 5 fine
f
dining menus. How
wever,
overall, pizzza is loose
ening its hold on the resstaurant me
enu, with me
enu penetration falling by
b 4%
from 2008 to 2012. Bu
ut menu trends reveal a wealth of cuisine-driiven growth
h opportunitty:
Push more mileage out of fus
sion cuisine
e. Pizza sho
ows up on almost 1 in 4 Mediterra
anean
concepts and
a 1 in 6 Mexican
M
conccepts. An ide
eal fusion fo
ood, pizza ca
an draw from
m various cu
uisines
while still maintaining
m
an identity frramed by itss basic partss: crust, saucce, and/or to
oppings.
Use pizza
a to mainstrream a wide
er variety off leaner pro
oteins. The most prevalent pizza prroteins
are overw
whelmingly associated
a
w traditionand high--fat content: sausage, pepperoni,
with
p
b
bacon,
ham, Italia
an sausage, meatball an
nd salami (se
even of the most
m
prevale
ent 10 pizza
a proteins fea
atured
on pizza entres)
e
are not exactly embraced
e
fo
or health.
Leverage vegetable variety an
nd consume
er acceptance. A slew
w of vegeta
able topping
gs are
available at
a 10% or more
m
of resta
aurants servving pizza en
ntres, rang
ging from the
e more ubiquitous
olives (at 69%)
6
to broccoli (30%) and arugula
a (10%), dem
monstrating strong main
nstream and niche
appeal. Ass an inheren
ntly healthy food,
f
vegeta
ables provide
e an ideal ve
ehicle for pu
urveyors to ratchet
r
up pizzass health proffile while cattering to con
nsumers ne
eeds while not having to
o aggressive
ely sell
the concep
pt to consum
mers, who already order pizzas with vegetables in abundancce.
Cheese = sophistica
ation. Cheesses once nott strongly asssociated with pizzafro
om feta to goat
g
to
gouda to asiagoare
a
now strong niche playe
ers across re
estaurant seg
gments. The
ese can be further
f
leveraged to tap interrnational/ethnic trends, fusion
f
cuisin
ne trends, and the aura of sophisticcation,
opening up
p new marke
et potential.
Sauce experimentatiion. Pizza could use a boost from
m a sauce made
m
more substantively
s
y from
whole cloth. Most pizz
za sauces ha
ave been in the mainstre
eam for som
me time: Pesto, novel 25 years
ago, is offfered by 27%
% restaurantts serving pizza
p
entress. Most othe
ers have borrrowed from
m other
popular disshes or conc
cepts.
Breakfastt daypart prrovides on--the-go inno
ovation pottential. Pizza is on onlyy 5% of resta
aurant
breakfast menus. But the low pen
netration of pizza
p
on the
e breakfast menu
m
belies innovation based
largely on the breakfa
ast burrito playbook.
p
Th
his takes on
n portability issues, which we view
w as a
growth eng
gine, but roo
om exists forr crossing otther on-the-g
go concepts with breakfa
ast pizza.
e often wove
en into menu
us, pizza is simply
s
Raise the health marrketing bar. While healtth claims are
not positio
oned with he
ealth-driven terminology:
t
: only 2.3% of restauran
nts serving pizza
p
as an entre
e
associate pizza with gluten
free on the me
enu; low fatt and organic are asssociated with
h only
1.9% and 1.1%. This
s miniscule degree of penetration suggests th
hat restaura
ant operatorrs can
experimen
nt more with healthful cla
aims that ressonate with pizza
p
eaterss.
Septemberr 2012
52
Pizza at Foo
R

oducts
Overvie
ew
kaged Facts assesses
a
pizzza menu treends, focusinng on menu item penetrration
and mennu item incid
dence by reestaurant seggment, incluuding top prroteins, ingrredients, cheeeses,
sauces, varieties,
v
kids menus, annd health maarketing claim
ms.
Menu iteem trending data has beeen providedd by Datasseential, a leadding food reesearch comppany.
We incluude menu iteem trend anaalysis drawnn from its MenuTrends
M
Direct produuct. MenuTrrends
Direct coontains analy
ysis of moree than 5,500 chain and inndependent menus, weigghted to thee U.S.
Census. We also in
nclude limiited-time offfer and new offer meenu item analysis from
m its
MenuTreends Insider..
Pizzaon
nmorethan
nathirdofrestauranttmenus
Pizzas popularity
p
iss underscoreed by its preevalence on U.S. restauurant menus,, with more than
one-thirdd of them feeaturing pizzza as an enttre on the menu.
m
And while
w
its most
m
prevalennt on
QSR resttaurant menu
us, it can also be found on
o 1 in 5 finee dining mennus.
Table51
1:Pizzaonth
heMenu:Re
estaurantPe
enetration,bySegmentt,2012
Penetration
All restaurantts
QSR
R
Mids
scale
C
Casual
F
Fine
Dining
34.2%
38.9%
%
30..8%
3
34.8%
19.6%
S
Source:
Datassen
ntial MenuTrendss Direct, used with permission; da
ata generated on
n July 23, 2012
S
Sample
base: me
enu analysis base
ed on 4,798 distinct restaurants
N
Note:
Pizza as an
n entre
Butado
ownwardtrrendisafoo
ot
r
m
menu,
with menu
m
penetrration
Howeverr, overall, pizza is loosening its hoold on the restaurant
falling byy 4% from 2008
2
to 20122.
Table
e52:Pizzao
ontheMenu
u:Restauran
ntPenetration,200820
012
Penetration
2008
2009
20
010
2011
2012
'12 vs.
'11
'12 vs.
'08
35.6%
3
35.5%
35
5.6%
34.7
7%
34.2%
%
-1.4%
-3.9%
S
Source:
Datassen
ntial MenuTrendss Direct, used with permission; da
ata generated on
n July 23, 2012
N
Note:
Pizza as an
n entre
Septemberr 2012
53
Pizza at Foo
R

oducts
Pizzacro
ossescuisin
nes
Naturallyy, pizza is universally
u
o
offered
on pizza restauraants and enjjoys high peenetration am
mong
Italian reestaurants. However,
H
pizza also show
ws up on a siignificant poortion of resttaurants featturing
a variety of cuisines, including Mediterranea
M
an, steakhousse, Mexican and seafoodd concepts.
m various cuuisines whilee still
In this reespect, pizzaa is an ideaal fusion foood, as it cann draw from
maintaining its generral identity by
b drawing from
f
its basicc parts: crustt, sauce, andd/or toppingss.
Table
e53:Pizzao
ontheMenu
u:Penetratio
on,
byRestaurantCuisineSpe
ecialty,2012
2
A restaurants
All
s
Pizza
99.3%
Italian
75.9%
Sandwich
33.7%
American
31.8%
Mixed Ethnicity
29.2%
Mediterranea
an
22.8%
Dessert/Snacck
19.4%
Coffee / Bake
ery
18.0%
Steakhouse
16.8%
Mexican
16.3%
Seafood
15.6%
Other Europe
ean
13.3%
Caribbean
12.5%
French
12.2%
Southern
10.3%
Source: Datasssential MenuTren

nds Direct, used with permission; data
generated on July
J
23, 2012
Sample base: analysis
a
based on
o 1,443 distinct restaurants servving pizza
as an entre
Septemberr 2012
54
Pizza at Foo
R

oducts
Toppro
oteins:high
hfatprote
einsaboun
nd,providiingopporttunityforlleaner
proteins
The beauuty of pizza is that its so
s inherentlyy flexible: coonsumers caan choose thheir own toppping,
from proteins to vegeetables to chheeses to sauuces. This meeans that connsumers cann not only contour
a pizza too personal taaste but also to a more sppecialized heealth profile..
Clearly, room existss for mainstreaming a wider varieety of leaneer proteins. As illustrateed by
the table below, the most prevallent are overrwhelminglyy associated with traditioonand higgh-fat
content: sausage, pep
pperoni, bacon, ham, Itaalian sausagee, meatball and
a salami (sseven of the most
prevalentt 10 pizza prroteins featuured on pizza entres) arre not exactlly embracedd for health. Only
one of thhe top 10ch
hickencann lay claim to a more heaalthful profile. Shrimp, which
w
roundds out
the top 12, can also be
b viewed ass healthful, as
a long as its high cholessterol contennt is overlookked.
Tab
ble54:Top
pPizzaProte
eins:RestaurrantPenetraationbyResstaurantSeggment,2012
2
All
restaurants
QS
SR
Mid
dscale
Casual
Fine Dining
Saussage
73.9%
%
82.2
2%
7
75.3%
69.0%
43.1%
Pepperoni
73.0%
%
85.2
2%
7
73.4%
65.5%
36.9%
Chiccken
65.9%
%
75.6
6%
6
65.3%
61.0%
32.3%
Baco
on
53.4%
%
67.2
2%
5
52.4%
44.3%
26.2%
Mea
at
49.1%
%
65.3
3%
5
51.3%
36.9%
13.8%
Ham
m
47.3%
%
58.7
7%
5
52.0%
38.5%
12.3%
Beeff
32.4%
%
45.8
8%
3
31.7%
23.2%
7.7%
Italia
an Sausage
31.3%
%
34.5
5%
3
30.3%
31.4%
7.7%
Mea
atball
25.6%
%
30.8
8%
3
30.3%
20.4%
10.8%
Sala
ami
24.7%
%
32.5
5%
2
27.3%
18.5%
6.2%
Stea
ak
16.8%
%
24.2
2%
19.6%
10.6%
0.0%
Shrimp
16.4%
%
12.9
9%
2
22.9%
16.6%
16.9%
Prossciutto
12.8%
%
7.7
7%
13.3%
15.2%
32.3%
Anch
hovy
3.6%
5.1%
3
3.0%
2.4%
4.6%
Sourrce: Datassential MenuTrends Direct, used with permission;

p
data generated on Ju
uly 23, 2012
Sample base: analys
sis based on 1,44
43 distinct restau
urants serving pizzza as an entre
Septemberr 2012
55
Pizza at Foo
R

oducts
Vegetab
blesunderscoreconsu
umertastevvariety;unttappedpottential
Four veggetables (onion, tomato, mushroom, peppers) aree available as
a toppings at
a more than 70%
of restauurants serving
g pizza as an
a entre, illuustrating theeir wide apppeal among consumers.
c
B a
But
slew of vegetable
v
to
oppings are available att 10% or moore of restauurants servinng pizza enttres,
ranging from the more
m
ubiquittous olives (at 69%) to
t broccoli (30%) andd arugula (110%),
demonstrrating strong
g mainstream
m and nichee appeal. Ass an inherenntly healthy food, vegettables
provide an ideal veh
hicle for puurveyors to ratchet up pizzas
p
heallth profile while
w
caterinng to
consumers needs. Using
U
pizza as
a the deliverry mechanissm, purveyorrs also find themselves
t
i the
in
enviable position of not
n having to sell the cooncept of veggetables to consumers, who
w already order
pizzas with vegetables in abundaance. Beset by
b increasinng consumerr health and calorie conccerns,
pizza maakers may bee underplayinng their handd here.
Table55:TTopPizzaVe
egetables& RelatedIngredients:
Pene
etrationbyR
RestaurantSSegment,20
012
All restaurants
QSR
Midscale
Casual
Fine Dining
Onion
77.2%
%
8
84.4%
74.9%
74.2%
53.8%
%
Tomato
75.6%
%
7
79.7%
74.5%
72.6%
72.3%
%
Mushroom
74.4%
%
8
82.6%
74.5%
69.3%
52.3%
%
Peppers
73.5%
%
8
83.5%
73.1%
67.6%
46.2%
%
Olive
68.6%
%
7
79.4%
69.7%
59.6%
55.4%
%
Garlic
56.1%
%
5
58.0%
61.6%
53.8%
36.9%
%
Spinach
46.5%
%
4
49.9%
55.0%
41.8%
24.6%
%
Basil
46.1%
%
3
35.1%
46.5%
54.0%
64.6%
%
Green Pe
epper
43.7%
%
5
56.8%
46.5%
33.4%
13.8%
%
Pineapple
41.8%
%
5
57.6%
45.4%
29.6%
4.6%
Red Onio
on
31.9%
%
3
34.0%
27.3%
33.8%
16.9%
%
Artichoke
e
31.4%
%
3
32.5%
34.3%
30.3%
20.0%
%
Broccoli
30.1%
%
3
33.2%
38.7%
25.3%
10.8%
%
Jalapeno
o
22.9%
%
3
32.1%
21.8%
16.7%
6.2%
Eggplantt
19.3%
%
1
18.4%
27.3%
17.2%
10.8%
%
Oregano
15.2%
%
1
13.3%
18.5%
16.4%
7.7%
Lettuce
13.8%
%
1
19.9%
14.4%
9.1%
3.1%
Cilantro
13.0%
%
1
11.6%
11.8%
15.7%
6.2%
Roasted Red Pepper
12.8%
%
1
14.3%
12.9%
12.2%
4.6%
Roma To
omatoes
11.3%
%
9
9.9%
12.2%
12.4%
9.2%
Arugula
9.5%
%
4
4.7%
4.8%
13.6%
32.3%
%
Sundried
d
7.8%
%
7
7.9%
10.3%
6.8%
6.2%
Bean
7.8%
%
9
9.9%
6.6%
7.0%
3.1%
Pepperon
ncini
6.1%
%
7
7.1%
7.4%
5.2%
0.0%
Hot Pepp
pers
6.1%
%
9
9.6%
7.4%
2.6%
3.1%
Green Onions
6.0%
%
6
6.8%
3.7%
7.0%
1.5%
Caper
5.7%
%
4
4.1%
7.7%
5.4%
12.3%
%
Banana Peppers
P
5.3%
%
7
7.3%
3.7%
4.7%
1.5%
Rosemarry
3.3%
%
2
2.6%
2.2%
4.2%
6.2%
Source: Datassential
D
Menu
uTrends Direct, used
u
with permisssion; data generrated on July 23,, 2012
Sample ba
ase: analysis bas
sed on 1,443 disstinct restaurants serving pizza ass an entre
Septemberr 2012
56
Pizza at Foo
R

oducts
Topcheeses:feta,goat,goud
da&asiago notjustfo
orfinedinin
ng
Mozzarella, the cheese most cllosely assocciated with pizza, also remains thee most prevvalent
cheese onn the menu, with almosst 7 in 10 resstaurants serrving pizza entres incluuding mozzaarella
as a pizzza cheese. However, cheeeses once not strongly associated
a
w pizza
with
from feta too goat
to gouda to asiago
are now stroong niche plaayers across restaurant segments.
Table56:TopPizzaC
Cheeses:
RestauranttPenetrationbyRestau
urantSegme
ent,2012
Alll
restaurrants
88.6%
SR
QS
Mid
dscale
C
Casual
Fine Dining
93.1%
88
8.6%
8
86.1%
73.8%
M
Mozzarella
68.3%
66.0%
67
7.2%
7
70.7%
69.2%
R
Ricotta
33.5
5%
34.0%
38
8.4%
3
32.6%
18.5%
P
Parmesan
31.4%
34.3%
28
8.8%
2
29.8%
32.3%
F
Feta
28.3%
34.0%
32
2.8%
2
22.6%
13.8%
C
Cheddar
27.5
5%
36.0%
25
5.1%
2
22.3%
13.8%
P
Provolone
20.9%
22.9%
23
3.6%
1
18.5%
15.4%
F
Fresh
Mozzare
ella
15.8%
10.7%
15
5.5%
1
19.2%
29.2%
R
Romano
15.5
5%
15.8%
17
7.7%
1
14.8%
10.8%
G
Goat
11.3%
5.3
3%
8
8.5%
1
17.4%
18.5%
G
Gorgonzola
8.8%
%
5.1
1%
10
0.0%
1
11.8%
7.7%
B
Bleu
8.7%
%
10.7%
8
8.5%
7.7%
1.5%
J
Jack
7.6%
%
6.4
4%
5
5.9%
9.6%
7.7%
F
Fontina
7.4%
%
3.2
2%
5
5.5%
1
12.0%
9.2%
A
American
7.2%
%
9.4
4%
7
7.0%
5.6%
4.6%
P
Pecorino
4.3%
%
2.4
4%
4
4.1%
5.6%
9.2%
G
Gouda
4.3%
%
2.4
4%
2
2.6%
6.8%
4.6%
S
Swiss
4.1%
%
5.3
3%
3
3.7%
3.3%
3.1%
A
Asiago
4.1%
%
3.6
6%
3
3.7%
5.1%
1.5%
M
Monterey
Jack
3.3%
%
2.6
6%
3
3.3%
4.0%
3.1%
C
Cheese
S
Source:
Datassential MenuTrends Direct, used with
w permission; data
d
generated on July 23, 2012
S
Sample
base: an
nalysis based on 1,443 distinct re
estaurants serving
g pizza as an en
ntre
Septemberr 2012
57
Pizza at Foo
R

oducts
Topsauces:traditio
onandwho
olesaleborrrowingreiggns
Good oldd marina saauce continuues to reign as the mostt prevalent sauce
s
on pizzza entres, with
more thaan 4 in 10 resstaurants serving pizza entres
e
includding marina as a pizza sauce.
Most of the
t more preevalent saucees have beenn in the mainnstream for some
s
time: Pesto,
P
considdered
novel 25 years ago, is offered as
a a pizza saauce by 27%
% restaurantss serving pizzza entres. Most
other sauuces have been borrowedd by other poopular dishess or conceptts: Alfredo frrom Italian pasta;
p
balsamic; ranch and Caesar from
m salads; andd BBQ. Whiile innovatioon within eacch of these sauce
s
types is highly
h
likely
y, pizza coulld also use a boost from a sauce or two
t
made more
m
substanttively
from whoole cloth.
Table57:TopPizzaSSauces:
urantSegme
ent,2012
Alll
restau
urants
41.7
7%
Q
QSR
Mid
dscale
C
Casual
Fiine Dining
34
4.7%
4
42.4%
48.3%
38.5%
O
Oil
31.7
7%
28
8.5%
3
31.7%
34.5%
32.3%
B
BBQ
31.5
5%
42
2.6%
2
27.3%
25.4%
12.3%
P
Pesto
26.9
9%
27
7.0%
2
25.5%
27.5%
26.2%
B
Buffalo
23.6
6%
30
0.2%
2
23.2%
19.3%
7.7%
A
Alfredo
14.1
1%
17
7.8%
17.0%
10.3%
4.6%
R
Ranch
14.1
1%
21.0%
14.0%
9.2%
0.0%
S
Salsa
7.4
4%
9.2%
7
7.0%
6.4%
3.1%
S
Sour
Cream
7.2
2%
10
0.1%
4
4.8%
6.1%
3.1%
G
Garlic
Sauce
5.8
8%
8.1%
5
5.5%
4.5%
0.0%
H Sauce
Hot
5.0
0%
8.3%
4
4.8%
2.6%
0.0%
W
White
Sauce
4.4
4%
6.4%
4
4.8%
3.0%
0.0%
B
Balsamic
4.3
3%
2.3%
3
3.0%
6.1%
10.8%
W
Wing
Sauce
4.0
0%
6.0%
4
4.1%
2.4%
0.0%
C
Cheese
Sauce
4.0
0%
5.1%
5
5.2%
3.0%
0.0%
C
Caesar
2.8
8%
2.8%
3
3.0%
2.8%
3.1%
T
Taco
Sauce
2.7
7%
4.9%
1
1.5%
1.6%
0.0%
M
Marinara
S
Source:
Datassen
ntial MenuTrendss Direct, used with permission; data generated on
n July 23, 2012
S
Sample
base: ana
alysis based on 1,443 distinct resstaurants serving
g pizza as an enttre
Septemberr 2012
58
Pizza at Foo
R

oducts
Topvariieties
Many off most popullar pizza varrieties are cllosely associiated with a region that quickly signnifies
consumer expectatio
ons: the nam
mes Hawaiiian, Greekk, Mexicaan, Siciliaan, and Phhilly
each prom
mise the exp
pectation off an ingredieent or preparration style, which helpss demystify what
might othherwise be viewed
v
as foreign,
f
or may
m help dirrect restauraant patrons to
t another chhoice
more suittable to theirr tastes. But on top sits the
t vegetariaan pizza, fouund on 8 in 10 menus offfering
pizza enttres.
Table58:TopPizzaVaarieties:
urantSegme
ent,2012
A
All
restau
urants
80.1%
Q
QSR
Miidscale
Casual
F
Fine
Dining
82
2.6%
7
78.7%
74.1%
0.0%
Cheese
79.9%
77
7.9%
8
88.9%
77.7%
100.0%
Hawaiian
55.8%
59
9.4%
5
54.6%
45.5%
0.0%
BBQ Chicken
50.3%
51
1.2%
5
51.9%
46.4%
0.0%
M
Meat
Lover
47.1%
48
8.2%
4
45.4%
45.5%
0.0%
Pe
epperoni
41.7%
42
2.5%
4
44.4%
35.7%
100.0%
M
Meatball
39.5%
37
7.1%
4
49.1%
38.4%
0.0%
Supreme
32.8%
35
5.7%
3
32.4%
24.1%
0.0%
G
Greek
30.3%
29
9.4%
3
38.0%
25.9%
0.0%
W
White
Pizza
29.3%
29
9.4%
2
28.7%
29.5%
0.0%
Buffalo Chicken
29.3%
31
1.3%
2
27.8%
24.1%
0.0%
M
Mexican
28.6%
32
2.7%
2
26.9%
17.0%
0.0%
Sicilian
22.3%
20
0.7%
2
23.1%
26.8%
0.0%
M
Margherita
21.1%
15
5.3%
2
25.0%
35.7%
100.0%
Sa
ausage
20.7%
20
0.2%
2
23.1%
19.6%
100.0%
Cheeseburger
16.2%
18
8.3%
1
10.2%
15.2%
0.0%
Q
Quattro
14.6%
11
1.7%
1
19.4%
19.6%
0.0%
Philly
13.9%
14
4.2%
1
15.7%
11.6%
0.0%
Pa
armigiana
12.2%
12
2.0%
1
14.8%
10.7%
0.0%
Fa
ajita
8.0
0%
9.5%
5.6%
5.4%
0.0%
California
7.1
1%
6.8%
7.4%
8.0%
0.0%
Th
hai
6.3
3%
5.4%
5.6%
9.8%
0.0%
Ve
egetarian
So
ource: Datassential MenuTrends Direct, used with permission; da
ata generated on July 23, 2012
Sa
ample base: ana
alysis based on 1,443 distinct restaurants serving pizza as an entrre
Septemberr 2012
59
Pizza at Foo
R

oducts
Dayparttanalysis:n
notjustfordinner
More thaan one-third of U.S. restaurant menuus feature pizza as an enntre. But a look
l
at menuus by
daypart tells
t
a differrent story: On
O All Dayy menus (m
menus offereed, well, alll day), pizzaa is a
common sight, show
wing up on one
o third of them.
t
This falls
f
to 16% on lunch menus
m
and to 15%
on dinnerr menus. Pizzza is on onlyy 5% of resttaurant breakkfast menus.
Table59
9:PizzaonttheMenu:R
RestaurantP
Penetration,byDaypart,,2012
Penetra
ation
To
otal
34
4.2%
A Day Menu
All
33.8%
Breakfast Menu
5.2%
%
Lun
nch Menu
16.3%
Dinner Menu
14.9%
Source
e: Datassential MenuTrends
M
Dire
ect, used with permission; data ge
enerated on Julyy 23, 2012
Sample base: analysis
s based on 4,798
8 distinct restaura
ants
Note: Pizza
P
as an entr
e
Butbreaakfastpizzaaexperimentationabo
ounds
But the low penetraation of pizzza on the breakfast menu
m
belies the strong degree of pizza
innovatioon geared toward
t
this daypart. As
A shown below,
b
breakkfast pizza experimenttation
abounds,, albeit by adhering
a
larggely to the breakfast
b
buurrito playboook. For exaample, 26 Beach
B
Restaurannt, located in
i Marina Del
D Rey, CA
A, goes a larrgely traditioonal route, scrambling eggs,
adding onnions and haam or baconn, then servinng on a pizzaa crust with tomato saucce and mozzaarella
cheese. Peas
P
are its novel
n
additioon.
echains
Butnotaamonglarge
Howeverr, according to our analysis of mennu data provided by Dattassential MenuTrends,
M
large
chains haave so far eschewed
e
exxperimentingg with breakkfast pizza. Smaller chhains are annother
story: am
mong restauraants we incluude in the taable below, smaller
s
chainns, such as BJ's
B Restauraant &
Brewery and Brio Tu
uscan Grille,, have rolledd out breakfaast pizzas.
Septemberr 2012
60
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R

oducts
Table510:PizzaontheBreaakfastMenu
u:SelectedEExamples,20
012
Restaura
ant
Item
26 Beacch
Restaura
ant
Breakfa
ast
Pizza
a
Ajo Al'ss
Mexica
an
Cafe
ast
Breakfa
Mexica
an
Pizza
a
Arcodorro
Boscaio
ola
Pizza
a
Beretta
a
Pizza
a
BJ's
ant
Restaura
& Brewe
ery
BJs
ast
Breakfa
Pizza
a
Brio Tusccan
Grille
Pranzo
Pizza And
A
Insalatta
Menu Description
D
Eggs scrambled with
h ham or bacon
n, onions,
peas, and served on
n a crisp pizza crust with
tom
mato sauce and
d mozzarella cheese.
A crisp
p tortilla layered
d with beans, eggs, green
chiles, pico de gallo, and topped with
w melted
nd jack cheese.
cheddar an
Homemade Italian sa
ausage, mushrrooms and
roasted red bell peppe
ers with tomato
o sauce and
mozzzarella.
c
with bacon, eggs, mozzarella,
m
Pizza carbonara
pe
ecorino and cra
acked black pe
epper.
c
thin-crusst topped with a touch of
Our crispy
marin
nara sauce, mo
ozzarella cheese and a
bacon, ham and sausa
age omelette fiinished with
tomato
oes, mozzarella
a and parsley and
a served
with seasoned
d country potato
oes.
Lunch
h size sausage
e, pepperoni & ricotta or
marghe
erita pizza, with
h your choice of
o chopped,
Caesar or biistecca insalata
a.
Californ
nia
Cafe Bar &
Grill
ast
Breakfa
Pizza
a
Scram
mbled eggs, carramelized onio
ons, garlic,
pancetta, scalllions, mozzare
ella.
Connie's
Pizza
ast
Breakfa
Scramb
bled
Pizza
a
Ginellis
Pizza
Breakfa
ast
Pizza
a
Main Stre
eet
Cafe
Breakfa
ast
Pizza
a
ci
Spinac
Pizza
a
Pulino's
Scrambled eggs, ch
heddar cheese
e, onions,
green peppers,
p
sausag
ge and provolo
one cheese,
serve
ed on our signa
ature dough. alternative
combina
ations available
e upon requestt. deep dish.
Countryy gravy, scramb
bled eggs and three kinds
of ch
heese. available
e with extra lea
an turkey
bacon or tu
urkey sausage..
Chedd
dar cheese on pizza crust. topped with
scrambled eggs and your choice off toppings.
Eggs, spinach,
s
mozzarella, creme fraiche
f
and
grana.
Price
Seg
gment
Cuis
sine
$13.00
Ca
asual
Amerrican
$7.95
Ca
asual
Mexican
$14.00
Ca
asual
Italia
an
$13.00
Ca
asual
Italia
an
$8.95
Ca
asual
Amerrican
$13.35
Ca
asual
Italia
an
$12.75
Ca
asual
Amerrican
$24.99
Midscale
Pizzza
$2.39
Q
QSR
Pizzza
$12.95
Midscale
Amerrican
$8.00
Q
QSR
Pizzza
Source: Datassential Me
enuTrends Directt, used with perm
mission; data gen
nerated on July 23,
2 2012
Sample base: menu ana
alysis based on 4,798
4
distinct resstaurants
Septemberr 2012
61
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R

oducts
Pizzahe
ealthmarke
etingclaimssbarelyden
ntthemen
nu
While heealth markeeting terms are not exactly ubiquiitous on the menu, theey or no loonger
invisible,, much lesss relegated exclusively
e
to a small box of the menu, wheere two or three
healthy menu item
ms reside. Rather,
R
morre and moree, health cllaims are woven
w
into menu
m
descriptioons from beg
ginning to end. And, as shown below
w, several health marketting claims (from
(
organic to low-fatt to all nattural, show up on roughhly 5% or moore menus nationwide.
n
Table511
1:HealthMaarketingTerrmsontheM
Menu:
PenettrationbyRe
estaurantSe
egment,201
12
QSR
Mid
dscale
C
Casual
F
Fine
Dining
Organic
All
nts
restauran
15.2%
%
8.3%
%
10
0.5%
19.2%
42.0%
Low Fat
6.4%
8.1%
%
8.4%
3.8%
5.7%
Multi Grain
6.3%
5.6%
%
6.5%
6.8%
6.6%
Fat Free
6.0%
9.3%
%
6.5%
3.6%
1.5%
All Natural
4.9%
4.8%
%
3.7%
5.3%
6.3%
Whole Grain
4.3%
2.9%
%
4.8%
4.2%
10.3%
Sugar Free
4.0%
3.4%
%
5.4%
4.1%
1.2%
Gluten Free
3.8%
3.0%
%
3.8%
4.5%
3.6%
Free Range
2.9%
1.1%
%
2.1%
3.2%
12.4%
Low Carb
2.7%
3.4%
%
2.7%
2.6%
0.6%
Farm Raised
2.2%
0.6%
%
2.1%
3.8%
1.8%
Low Calorie
1.6%
1.5%
%
2.4%
1.3%
0.6%
C
Cholesterol
Free
e
1.4%
0.9%
%
2.9%
1.1%
0.6%
Antioxidant
1.1%
1.8%
%
0.8%
0.6%
1.5%
Grass Fed
0.8%
0.2%
%
0.4%
1.0%
4.5%
Trans Fat
0.7%
0.8%
%
0.9%
0.5%
0.0%
Sustainable
0.6%
0.3%
%
0.1%
0.9%
1.8%
Source: Datassentiial MenuTrends Direct,

D
used with
h permission; datta generated on July
J
23, 2012
Sample base: analy
ysis based on 4,853 distinct resta
aurants
Anemicpizzahealtthmarketin
ngties
But while health claiims are oftenn woven intoo menus, pizzza is simplyy not positiooned with heealthdriven teerminology: only 2.3% of restaurannts serving pizza as ann entre assoociate pizza with
gluten free
f
on the menu;
m
low fat and orrganic are associated
a
wiith only 1.9%
% and 1.1%.. This
minisculee degree off penetrationn suggests thhat restaurant operatorss can experiiment more with
healthfull claims that resonate witth pizza eateers.
Septemberr 2012
62
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R

oducts
Table512:P
T
PizzaHealthMarketingTermsonth
heMenu:
RestaurantPenetration
nbyRestaurrantSegmen
nt,2012
All
restaurants
2.4%
SR
QS
Mid
dscale
Casual
F
Fine
Dining
2.6%
3
3.0%
2.3%
0.0%
Low
w fat
1.9%
2.3%
1.5%
1.9%
0.0%
Org
ganic
1.1%
1.1%
0
0.4%
1.4%
1.5%
Mu
ulti grain
0.5%
0.4%
0
0.7%
0.5%
0.0%
Fatt free
0.3%
0.6%
0
0.7%
0.0%
0.0%
Low
w carb
0.3%
0.4%
0
0.7%
0.2%
0.0%
Wh
hole grain
0.3%
0.0%
0
0.4%
0.5%
0.0%
"All natural"
0.3%
0.4%
0
0.4%
0.2%
0.0%
Fre
ee range
0.2%
0.4%
0
0.0%
0.2%
0.0%
Low
w calorie
0.2%
0.2%
0
0.4%
0.2%
0.0%
Farm raised
0.1%
0.2%
0
0.0%
0.0%
0.0%
Ch
holesterol free
0.1%
0.0%
0
0.0%
0.2%
0.0%
Ho
ormone free
0.1%
0.0%
0
0.0%
0.2%
0.0%
Da
airy free
0.1%
0.0%
0
0.4%
0.0%
0.0%
Om
mega
0.1%
0.2%
0
0.0%
0.0%
0.0%
Tra
ans fat
0.1%
0.0%
0
0.4%
0.0%
0.0%
Glu
uten free
Source: Da
atassential Menu
uTrends Direct, used
u
with permission; data generrated on July 23, 2012
Sample base: analysis based on 1,44
43 distinct restau
urants serving pizzza as an entre
ozenpizzaproductin
ntroductio
ons
Newfro
12:DiGiorno
o,CPKandTo
ombstone
June201
DiGiornoo Italian Style Favorites in three flavvors: Meatbaall Marinaraa Pizza; Meaat Trio Pizzaa with
Genoa salami, Italiaan sausage, pepperoni and mozzaarella; and Chicken
C
Paarmesan Pizza, a
combinattion of whitee meat chickken, tomatoes and zesty marinara.
m
Californiia Pizza Kitchen Limiteed Edition Chicken
C
Carrbonara Pizzza, a thick crust
c
topped with
garlic crme fraichee sauce, roseemary, grilleed white meat
m
chicken, applewoodd smoked bacon,
p
asiago, romanno and mozzaarella cheesees.
onions, parmesan,
Californiia Pizza Kittchen Limiteed Edition Chipotle
C
Rooasted Vegetables, a meeatless thin--crust
pizza toppped with ro
oasted red annd yellow peppers,
p
poblano pepperrs, roasted coorn, black beans,
b
chipotle lime
l
sauce, parmesan,
p
assiago, romanno and mozzzarella cheesse.
Tombstone Double Top
T Pizza with
w a choicee of Pepperooni (with tw
wice the meaat toppings as
a the
Original)); Supreme, with twice the
t meat andd vegetable toppings
t
as the Originall Supreme; and
a 4
Septemberr 2012
63
Pizza at Foo
R

oducts
Meat, with twice th

he amount of
o sausage, pepperoni, hamburger and Canadiian bacon as
a the
Original 4 Meat pizza.
May201
12:KashiFou
urCheesePiizza
In May 2012,
2
Kashi introduced Kashi Four Cheese Pizzza, which feeatures a bleend of provoolone,
mozzarellla, white Cheddar
C
annd Fontina cheeses, a zesty vegeetable saucee made froom a
combinattion of real tomatoes, onion, garlic and carrot juice
j
concenntrate on topp of a stone--fired
thin crustt made with Kashi 7 Whhole Grains & Sesame with
w flaxseed..
"In develloping the new
n Kashi Foour Cheese Pizza, we'vee put a tastyy, unique spin on this cllassic
mealtimee favorite," says
s
Jeff Johnson, senioor nutritioniist and naturral food andd lifestyle exxpert.
"Our new
w Four Cheeese Pizza prrovides savoory flavors everyone
e
lovves but with real, wholesome
ingrediennts that offerr up great tasste and nutrittion in everyy bite," citingg a companyy press releaase.
This threee-serving veegetarian pizzza providess 6 grams off fiber, 15 grrams of proteein and 14 grams
g
of wholee grains per serving. Itss now availaable in the frozen aisle of grocers and natural food
retailers nationwide
n
for
f a suggestted retail priice of $5.99.
12:FrozenN
NakedPizza&
&BoldOrgaanicsPizza
April201
FrozenN
NakedPizza
N
Pizzaa, a take-out and deliveryy franchise, began offering its betterr-forNew Orleans-based Naked
you pizzaa into the freeezer aisle.
Made wiith an Ancesttral Blend off 10 grains (oats,
(
brownn rice, buckw
wheat, quinoa, amaranth,, teff,
spelt, tappioca, wheatt and prebiootic agave fiiber), the crrust containss Bacillus cooagulans GB
BI-30
6086, a probiotic
p
baccteria that suurvives both freezing andd baking tem
mperatures.
The pizzaas comes come in:
topped wiith artichokkes, roastedd red pepppers, red onions,

o
spinnach,
Superbiotic
m
mushrooms,
roasted
r
garliic and cilantrro.
U
Uncured
Pepp
peroniall-natural peppperoni and mozzarella
m
chheese.
C
Cheese100
0% premium
m mozzarella..
C
Chickenble
ended with red
r bell pepppers and sweeet yellow onnions.
Frozen Naked
N
Pizzass are availabble nationwidde with a suuggested retaail price of $8.99
$
for an 11.8ounce boox (Refrigera
ated & Frozeen Foods, April
A
2012).
Septemberr 2012
64
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R

oducts
BoldOrganicsPizza
As reporrted in Refriigerated & Frozen
F
Foodds, Chef Eriic Brenner, co-owner off the New YorkY
based prooducer of glluten- and dairy-free
d
pizzas, introduuced Bold Organics
O
in the beginninng of
2012 witth the hopes of creating a healthy pizzza for its heealth-conscioous consumeers.
Bold Orgganics is mad
de with 85%
%-certified orrganic ingredients and features
fe
a siggnature saucee that
is blend of
o organic to
omatoes and organic herbbs and spicees and an all--natural rice flour crust.
As for thheir toppingss, Bold Orgaanics scourss farms throuughout the country
c
for the
t perfect flavor
f
profiles with
w optimu
um health beenefits, suchh as organic shitake musshrooms, orgganic roasted red
peppers, organic roassted yellow onions
o
and organic
o
spinaach.
The new team of pizzzas include Vegan
V
Cheeese, Veggie Lovers
L
(chocck full of seaasonal vegettables
such as smoky roastted peppers,, sweet roassted onions and woody shiitake muushrooms), Meat
Lovers (lloaded with an abundannce of spicyy uncured peepperoni andd juicy orgaanic sausage)) and
Deluxe (smoky
(
roaasted pepperrs, sweet rooasted onioons, woody shiitake mushrooms,
m
spicy
uncured pepperoni
p
an
nd juicy orgaanic sausagee).
In additioon to being gluteng
and dairy
d
free, Bold
B
Organiccs pizzas aree also labeledd as casein-free,
egg-free,, peanut-free and tree--nut free, and
a
containn no Genetiically Modiified Organnisms,
preservattives, nitrites, nitrates or trans-fats. An 18-monnth shelf lifee enables coonsumers to store
the produucts in their freezer for future
fu
meals,, (Snack Foood & Wholeesale Bakeryy, June 2012)).
12:UdisGlu
utenFreeFrozenPizza
April201
Udi's Gluuten Free Fo
oods, Denverr, has expanded its prodduct line beyoond bread annd bakery sttaples
in orderr to reach consumers at more eating
e
occassions, targeeting glutenn-free consuumers
specificaally. Its glutten-free frozzen pizza iss available in
i Pepperonni, Margheriita and 3-Chheese
flavors.
"Our goaal is to creatte delicious,, wholesomee foods for all
a meals, soo gluten-freee customers have
the samee eating and
d shopping experience
e
a others, says
as
s
Denise Sirovatka, vice
v
presideent of
marketinng, in an Ap
pril 2012 prress release. Udi's frozeen pizza is made in a 100% dediccated,
certified gluten-free bakery,
b
and is available in stores nattionwide.
March2
2012:AnniesOrganicRisingCrustP
Pizza
Annies, Inc., Berkeeley, Calif., expanded itts Annie's braand to incluude a certifieed-organic rising
r
crust pizza. Accordin
ng to the coompany, its pizza is the first and onnly pizza wiith organic rising
r
crust, 8 grams
g
of wh
hole grain inn every serviing and a chhoice of certtified-organiic vegetables and
meats. Options inclu
ude Uncuredd Pepperonii, Four Cheeese, Suprem
me Variety, and Spinacch &
Mushrooom:
Septemberr 2012
65
Pizza at Foo
R

oducts
The Uncured
T
d Pepperoni option
o
is maade with 1000% nitrate-frree pepperonni and real rB
BSTfrree mozzarellla and provoolone cheesees.
T Four Cheeese kind com

The
mbines mozzzarella, provvolone, parm
mesan and roomano cheesses.
The Supremee variety serrves up a heearty helpingg of Italian sausage, unncured peppeeroni,
T
rooasted onion
ns, roasted reed bell peppeers and greenn bell peppers.
And, the Spin

A
nach & Musshroom pizzza features Annie's
A
signnature garlic parmesan cream
c
chheese with spinach, Porttobello and button
b
mushrrooms and diced
d
tomatooes.
F
All four 11.5-inch faamily-sized varieties aree now available in the frozen aisle at Whole Foods
Markets nationwide for
f a suggested retail priice $9.99 forr a 23.6-ouncce box.
Newoffe
erings:pizzaacrust
For thosee consumerss who wantt to make thheir own pizzza without the hassless of dealing with
crusts, seeveral comp
panies have released cruusts that alsoo address diietary restricctions, incluuding:
Kinnikinnnick Foods with
w its Kinnnikinnink Thhin Pizza Crrusts-Glutenn Free in Julyy 2011. Its made
m
with potaato starch, peea starch andd white rice flour.
Rustic Crusts
C
offers the Gluten Free Napolii Herb crustt made with white rice flour
f
and tappioca
flour. Ruustic also seells Organicc Pizza Origginale and Organic Grreat Grains, (Snack Foood &
Wholesalle Bakery, Ju
une 2012).
Septemberr 2012
66
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R
Re
estaurant Purch
hase Decision and
a
Eating Expe
erience
Chapter6
6:RestaurantPizzaPurchaseDecisio
onandEatin
ngExperiencce
INTROD
DUCTION
In this se
ection of the
e report, as part of a thrree-question
n set analysiis, Packaged Facts asssesses
factors driving
d
the restaurant pizza purcchase decission, includiing (ranked
d) pizza ord
dering
influence
ers; restaura
ant pizza eatting rationales; choice of
o eating parrticipants; ovver eating, use
u of
promotio
ons; and hea
althy option awareness.
a
INSIGH
HTCAPSU
ULE
Among re
estaurant pizza users, pizza is natturally the purchase
p
drraw: consum
mers most strongly
s
agreed th
hat topping
gs and crrust influen
nced their decision
d
to get food/drrink from a pizza
restaurant (each rece
eived a 4.4 on
o a ranking
g scale). Bu
ut they rankk non-pizza menu
m
items at 3.9,
calling fo
or industry participantts to contin
nue develop
ping non-pizza items to grow sales and
diversify away
a
from th
heir bread an
nd butter.
cept of com
mmunity and
d sharing is writ large
e on consum
mers intera
action with pizza,
The conc
and shou
uld be leverraged in ma
arketing me
essages an
nd serving/p
preparation innovation
ns. The
last time they ate piz
zza from a re
estaurant, almost
a
half of
o restaurantt pizza eaterrs got it beccause it
was an easy
e
choice to agree on
n with otherss, while more than a th
hird got it be
ecause its easy
e
to
share with
h others. Sim
milarly, almo
ost 1 in 10 got
g pizza be
ecause they had company over, and
d more
than 4 in 10 got pizza because they
t
wanted
d something easy to serrve. Community and sha
aring is
especiallyy relevant to younger consumers.
Coupon usage open
ns doors fo
or targeted marketing. Coupons arre a factor in
n 1 of 5 restaurant
pizza purrchases, und
derscoring both
b
the bre
eadth of pro
omotional acctivity and itts acceptancce and
use. While the industry should na
aturally be wary
w
of signifficant discou
unting, estab
blished coup
pon use
can provide a strong
g foundation for targetin
ng marketing
g, providing added usag
ge incentive
e and a
volume-drriven counte
erweight to lo
ower price-p
per-unit saless.
With pizzza such a universally
u
a
accepted,
hig
gher-volume
e food choicce, its not surprising
s
th
hat it is
woven in
nto consum
mers lifestyles and rou
utines, whicch the industtry should continue to target.
Having a routine piz
zza night is a rationale for getting pizza from a restaurant among 2 in 10
restaurant pizza eaters. TV Nigh
ht was a pu
urchase facto
or for 7%. Th
his is especiially relevant to 2544s and $100K+
$
HH income conssumers.
When sc
chedules ov
vertake us, send pizza
a to the res
scue. Almost 2 in 10 go
ot pizza beccause it
was too la
ate to cook, positioning pizza
p
as a go-to food ch
hoice when schedules
s
ru
un amok or cooking
c
becomes less feasible. In a sim
milar vein, 7%
% of restaurrant pizza eaters
e
got pizza becausse they
worked la
ate. This is especially relevant to $10
00K+ HH inccome consum
mers.
Children influence a variety of
o pizza pu
urchase rattionales, which should
d be leverag
ged by
marketing
g messages targeting families. More
eover, the la
ast time theyy ate pizza frrom a restau
urant, 7
in 10 resttaurant pizza
a users ate with
w family (2
( in 10 ate with kids an
nd 2 in 10 ate with teenagers).
Only 1 in
n 10 ate piz
zza alone, underscoring
u
g concern that
t
pizza purveyors
p
a not cap
are
pturing
orders frrom people
e wishing to feed on
nly themsellves. Family marketin
ng message
es may
resonate most among
g women, 25
5-44s, middle
e-income, and (of coursse) families.
With resp
pect to their most recen
nt pizza eating experien
nce, just ove
er one half of
o restauran
nt pizza
users were very satiisfied with their
t
meal, and
a
about one-third
o
rep
porting feelin
ng full. And
d while
pizza is noted
n
for its indulgent qualities,
q
only 13% said
d they ate to
oo much pizzza and onlly 11%
overindulged. Even fewer5%
felt bloated. But only 1 in 10 resttaurant pizzza eaters sa
ay that
healthy pizza
p
option
ns were ava
ailable, sugg
gesting that the restaurant pizza industry is no
ot doing
enough to
o promote orr develop he
ealthier optio
ons.
Septemberr 2012
67
Pizza at Foo
R
Re
estaurant Purch
hase Decision and
a
Eating Expe
erience
Introducction
In this seection of th
he report, as part of a thhree-questioon set analyssis, Packageed Facts asssesses
factors driving
d
the restaurant pizza purchase decision, includinng (ranked)) pizza orddering
influenceers; restauran
nt pizza eatiing rationalees; choice of eating partticipants; ovver eating, use
u of
promotioons; and heallthy option awareness.
a
Specificaally, we askeed three setss of questions to the 1,6637 responddents age 188+ who got pizza
p
from anny restauran
nt in the last 12 months via
v dine-in, pickup
p
or delivery:
P
Please think
k about the last
l time youu got pizza from a restaaurant. For each
e
of the listed
l
sttatements, pllease indicatte the extentt to which eaach statemennt influencedd your decisiion to
get food/drink from a pizzza restauraant. Each sttatement hass its own scale ranging from
y disagree) to
t "5" (definnitely agree).
"1" (definitely
Please
think
k about the last
l time you got pizza from a restaaurant. Did you
y get pizzza for
anny of the folllowing reasoons?
Thinking
of
o the last tiime you atee pizza thatt was from a restaurantt, do any of
o the
foollowing stattements apply to your eaating experieence?
In this seection, we an
nalyze the results to these questions.
PizzaOrderingInffluencers
nalyze results to the folloowing questiion:
P
Please think
k about the last
l time youu got pizza from a restaaurant. For each
e
of the listed
l
sttatements, pllease indicatte the extentt to which eaach statemennt influencedd your decisiion to
get food/drink from a pizzza restauraant. Each sttatement hass its own scale ranging from
y disagree) to
t "5" (definnitely agree).
"1" (definitely
on to responndents age 188+ who got pizza
p
from any
restaurrant in the laast 12

We posedd the questio
months via
v dine-in, pickup
p
or dellivery
Pizzaatttributesare
ethestronggestdraw
When peeople choosee to get pizzaa from a resstaurant, pizzza is naturally the draw.. When askeed the
extent too which the statements listed
l
below
w influenced their latest decision to get pizza frrom a
restaurannt, consumerrs most stronngly agreed with
w toppinngs and cruust (each reeceived a 4.44 on a
ranking scale).
s
Septemberr 2012
68
Pizza at Foo
R
Re
estaurant Purch
hase Decision and
a
Eating Expe
erience
Butitsn
notjustabo
outpizza
Just beloow the pizzza itself, connsumers aree influencedd by convennient locatioon and speeed of
service, followed by
b value annd price. Consumers
C
r
ranked
nonn-pizza mennu items at 3.9,
demonstrrating the in
nfluence of menu
m
items that may suupplement the
t pizza orrder or (for some
patrons) replace the pizza order. This calls for
f industry participants to continue developing nonpizza item
ms to entice sales.
Grraph61:PizzzaOrderinggInfluencerss:RankingScores,2012
Source
e: Packaged Fac
012 proprietary survey
s
Base: 1,637 responden
nts age 18+ who got pizza from any restaurant in the last 12 months via dine-in, pickup or delivery
ere asked the folllowing question:: Please think ab
bout the last time
e you got pizza frrom a restaurantt.
Surveyy respondents we
For each of the listed statements,
s
pleasse indicate the exxtent to which ea
ach statement inffluenced your de
ecision to get
a restaurant. Each statement has its own scale ranging from "1" (d
definitely disagre
ee) to "5" (definite
ely
food/drrink from a pizza
agree)?
Septemberr 2012
69
Pizza at Foo
R
Re
estaurant Purch
hase Decision and
a
Eating Expe
erience
Gender:: tiltmarkettingmessagestoemp
phasizevalu
ueandconvvenience
Results suggest
s
that industry
i
parrticipants shoould tilt marrketing messages by gennder, emphassizing
value andd convenien
nce to femalee promotionn recipients. While wom
men more stroongly agree each
attribute statement liist below innfluences theeir decision to get pizzaa from a resstaurant, they are
especiallyy more likelly to cite valuue and convvenience.
Table61:PizzaOrd
deringInflue
encers:RankkingScores,byGender,2012
Toppingss
Crust
Convenient location
Speed of
o service
Value
Price
Craving pizza
Speed of
o delivery
Non-pizzza menu items
Online ordering
o
All
M
Male
Fem
male
4.38
4.36
4.34
4.29
4.22
4.18
4.15
4.06
3.93
3.59
4.37
4
4
4.35
4
4.33
4
4.29
4
4.15
4
4.10
4
4.10
4
4.05
3
3.92
3
3.60
4.4
40
4.3
37
4.3
34
4.3
30
4.2
28
4.2
24
4.1
19
4.0
06
3.9
95
3.5
58
Tren
nd
Source: Packaged Factts, based on data

a from August 20
Base: 1,637
1
respondents age 18+ who got
g pizza from a
any restaurant in
n the last 12 mon
nths via dine-in, pickup
p
or deliveryy
Survey respondents we
ere asked the following question: Please think ab
bout the last time you got pizza fro
om a restaurant. For
ments, please ind
dicate the extent to which each statement influencced your decision to get food/drin
nk
each off the listed statem
from a pizza
p
restaurant.. Each statementt has its own sca
ale ranging from "1" (definitely dissagree) to "5" (de
efinitely agree)?
Ageanaalysis:playu
upthecravving
While thhe concept of
o craving iss a well-knoown marketting trope, itts influencee among youunger
consumers should no
ot be undersstated. Restaaurant pizzaa users age 18-34
1
are most
m
likely too cite
craving pizza
p
as inflluencing theeir decision to
t get pizza from a resttaurant, whille 55+s are more
likely to cite pizza atttributes, connvenience atttributes, valuue and pricee.
Septemberr 2012
70
Pizza at Foo
R
Re
estaurant Purch
hase Decision and
a
Eating Expe
erience
Table6
62::PizzaO
OrderingInfluencers:RaankingScore
es,ByAge,2
2012
Alll
18-24
25-34
35--44
45-54
55-64
65
Toppingss
Crust
Convenie
ent location
4.38
8
4.36
6
4.34
4
4.32
4.32
4.18
4.33
4.30
4.33
4.3
31
4.3
36
4.3
33
4.34
4.25
4.34
4.49
4.41
4.34
4.54
4
4
4.53
4
4.46
Speed off service

Value
Price
Craving pizza
p
Speed off delivery
Online orrdering
4.29
9
4.22
2
4.18
8
4.15
5
4.06
6
3.93
3
3.59
9
4.13
4.16
4.06
4.28
4.07
3.97
3.70
4.24
4.24
4.19
4.29
3.94
3.93
3.76
4.2
23
4.1
18
4.1
10
4.1
15
3.9
97
4.0
03
3.5
58
4.30
4.26
4.23
4.16
3.95
3.88
3.58
4.35
4.22
4.19
4.09
4.14
3.87
3.48
4.48
4
4
4.26
4
4.27
3
3.95
4
4.34
3
3.90
3
3.48
Tren
nd

s, based on data
a from August 2012 proprietary su
urvey
Base: 1,637 respondentts age 18+ who got
g pizza from any restaurant in
n the last 12 months via dine-in, pickup
p
or deliveryy
Survey respondents werre asked the follo
owing question: Please
think abo
out the last time you got pizza fro
ments, please ind
dicate the extent to which each sttatement influencced your decision
n to get food/drin
nk
each of the listed statem
p
restaurant. Each statement has its own scale ranging from "1"
" (definitely disagree) to "5" (de
efinitely agree)?
from a pizza
HHincomeanalysis
K+ restauran
nt pizza useers are moree likely thann average too note toppiings and cruust as
$25-$75K
influenciing their decision to get food/drink from
f
a pizza restaurant. $100K+
$
users are least likely
l
to cite vaalue, price, and
a craving pizza.
p
Table63:PizzaOrd
deringInflue
encers:RankkingScores,HHIncome,,2012
All
<$25K
$
$25K$49.9K
$
$
$50K$74.9K
$7
75K$9
99.9K
$10
00K+
Toppingss
Crust
Convenie
ent location
4.38
4.36
4.34
4.37
4.30
4.29
4.44
4.40
4.37
4.40
4.39
4.38
4.38
4
4
4.42
4
4.33
4.30
4.28
4.28
Speed off service

Value
Price
Craving pizza
Speed off delivery
Online ordering
4.29
4.22
4.18
4.15
4.06
3.93
3.59
4.26
4.24
4.17
4.19
4.06
3.93
3.57
4.31
4.27
4.23
4.22
4.02
3.94
3.60
4.32
4.24
4.20
4.10
4.14
3.91
3.63
4.29
4
4
4.22
4
4.18
4
4.15
3
3.99
4
4.08
3
3.56
4.28
4.10
4.06
4.04
4.04
3.85
3.59
Trend
Source:: Packaged Facts

s, based on data
a from August 20
012 proprietary su
urvey
g pizza from a
any restaurant in
n the last 12 mon
nths via dine-in, pickup
p
or deliveryy
Survey respondents were asked the follo
owing question: Please think about the last time you got pizza fro
ments, please ind
dicate the extent to which each sttatement influencced your decision
n to get food/drin
nk
each of the listed statem
p
restaurant. Each statementt has its own sca
ale ranging from "1"
" (definitely dissagree) to "5" (de
efinitely agree)?
from a pizza
Septemberr 2012
71
Pizza at Foo
R
Re
estaurant Purch
hase Decision and
a
Eating Expe
erience
Race/ethnicityanaalysis
White reestaurant pizzza users aree more likelly than averrage to note pizza attribbutes, conveenient
location and speed of service as influenciing their deecision to get
g food/drinnk from a pizza
restaurannt. Hispanic users,
u
on thee other hand, are most likkely to cite craving
c
pizza.
Table64:P
PizzaOrderin
ngInfluence
ers:RankingScores,ByR
Race/Ethniccity,2012
Toppin
ngs
Crust
Convenient location
n
Speed of service
Value
Price
Craving
g pizza
Speed of delivery
Non-pizza menu items
Online ordering
All
White
e
Hispanic
Black
A
Asian
4.38
4.36
4.34
4.29
4.22
4.17
4.14
4.05
3.93
3.58
4.43
3
4.39
9
4.36
6
4.32
4.22
4.18
8
4.15
5
4.08
8
3.94
4
3.57
7
4.34
4.31
4.33
4.27
4.23
4.17
4.23
4.06
4.00
3.55
4.24
4.30
4.32
4.21
4.23
4.17
4.03
3.93
3.85
3.63
4.17
4
4
4.05
4
4.02
3
3.97
4
4.05
4
4.02
4
4.00
3
3.83
3
3.71
3
3.78
Tren
nd
Source
e: Packaged Fac
2
proprietary survey
s
nts age 18+ who
o got pizza from any
restaurant in the last 12 mo

onths via dine-in, pickup or delive
ery
ere asked the following question: Please think about the last time
e you got pizza from
f
a restaurantt.
For ea
ach of the listed statements,
s
pleasse indicate the exxtent to which ea
ach statement inffluenced your de
ecision to get
food/drink from a pizza
a restaurant. Eacch statement hass its own scale ra
anging from "1" (d
definitely disagre
ee) to "5" (definite
ely
agree))?
RestaurrantPizzaEatingRattionales
Please think
k about the last
l time you got pizza from a restaaurant. Did you
y get pizzza for
anny of the folllowing reasoons?
p
from any

months via
v dine-in, pickup
p
or dellivery
Communityandsh
haring
munity and sharing is writ
w large onn consumerss interactionn with pizzaa, and
The conccept of comm
should bee leveraged in
i marketingg messages and
a serving/ppreparation innovations.
i
.
Septemberr 2012
72
Pizza at Foo
R
Re
estaurant Purch
hase Decision and
a
Eating Expe
erience
The commun
T
nal nature off pizza is a significant draw for coonsumers annd a foundattional
raationale for getting pizzza from a restaurant: The last time
t
they ate
a pizza froom a
reestaurant, allmost half of
o restaurantt pizza eaterrs say they got pizza from
f
a restaaurant
because it was
w an easy choice to agree
a
on wiith others, while
w
more than a thirdd got
because its easy
e
to sharre with otherrs. Similarlyy, almost 1 in
i 10 got pizzza becausee they
had company
y over.
More than 4 in
M
i 10 got pizzza because they wantedd something easy to servve, which im
mplies
seelf-service and
a serving others.
o
Couponssusageope
ensdoorsffortargeted
dmarketingg
Coupons were a facctor in 1 of 5 restaurantt pizza purchases, underrscoring botth the breaddth of
promotioonal activity and its acceeptance and use. While the industryy should natuurally be waary of
significannt discounting, establishhed coupon use can prrovide a stroong foundattion for targgeting
marketinng, providing
g added usagge incentive and a volum
me-driven counterweighht to lower pricep
per-unit sales.
s
Continuetotargetestablishedroutines
With pizzza such a un
niversally acccepted, highher-volume food choicee, its not suurprising thatt it is
woven innto consumers lifestyless and routinees. The Supeer Bowl, so closely
c
assocciated with pizza,
p
is by faar the biggeest example, but other routines and
a
lifestyle events aree also prevaalent.
Accordinng to our su
urvey, havingg a routine pizza night was cited by
b 2 in 10 as
a a rationalle for
getting pizza
p
from a restaurant. TV Nightt was a purrchase factoor for 7% off restaurant pizza
eaters, cllearly those who
w got pizzza for pickupp or deliveryy to eat at hoome.
Whenscchedulesovvertakeus,,sendpizzaatotherescue
l to cook,, positioningg pizza as a go-to
g
food chhoice
Almost 2 in 10 got pizza becausee it was too late
when schhedules run amok or coooking becom
mes less feaasible as the night wearss on. In a similar
vein, 7% of restauran
nt pizza eaters got pizza because theyy worked latte.
Septemberr 2012
73
Pizza at Foo
R
Re
estaurant Purch
hase Decision and
a
Eating Expe
erience
Graph62
2:RestaurantPizzaEatin
ngRationale
es,2012
Source
e: Packaged Fac
s
ere asked the folllowing question:: Please think ab
bout the last time
e you got pizza frrom a restaurantt.
Did you get pizza for an
ny of the followin
ng reasons?
Age:com
mmunityan
ndsharing
18-24s arre more likeely than otheer age groupps to cite seeveral rationaales for gettting pizza frrom a
restaurannt, including
g agreeable choice,
c
easee of serving,, too late too cook, and having com
mpany
over. 25--44s are mosst likely to cite
c a routinee pizza nightt, underscoriing the probbable influennce of
children in these hou
useholds.
Taable65:ResstaurantPizzaEatingRaationales,ByyAge,2012
Easy cho
oice to agree on
n with others
Wanted something
s
easy
y to serve
Easy to share
s
with others
Had a coupon
routine pizza night
Too late to
t cook
I had com
mpany over
TV night
Worked la
ate
A
All
1824
2534
3544
4554
5564
65+
45
5%
43
3%
36
6%
19
9%
18
8%
17
7%
9
9%
7
7%
7
7%
121
126
102
93
105
145
189
151
87
98
107
85
117
128
110
104
159
147
88
104
98
86
120
109
79
100
140
99
92
94
124
100
97
84
70
95
105
93
104
86
77
75
93
72
92
97
86
121
89
64
73
82
64
22
Trend

s, based on data from August 201
12 proprietary su
urvey
Base: 1,637 respondents
s age 18+ who got pizza from an
ny restaurant in the last 12 montths via dine-in, pickup or deliveryy
Survey respondents
r
were asked the follo
owing question: Please think abo
out the last time you
y got pizza from a restaurant. Did
D
you get pizza
p
for any of the
t following reassons?
Septemberr 2012
74
Pizza at Foo
R
Re
estaurant Purch
hase Decision and
a
Eating Expe
erience
Income: routine and working latee

$100K+ restaurant pizza
p
users are
a most likeely to cite having a routtine pizza niight and working
late as raationales for getting pizza from a resttaurant.
Table66:Restau
urantPizzaEEatingRation
nales,ByHH
HIncome,20
012
Easy choicce to agree on w/ others
Wanted so
omething easy to serve
Easy to sh
hare with others
s
Had a cou
upon
Routine pizza night
Too late to
o cook
I had company over
TV night
Worked la
ate
A
All
<$25K
K
$25K$49.9K
$50K$74.9K
$75K$99.9K
$1
100K+
45%
4
4
43%
3
36%
19%
18%
17%
9
9%
7
7%
7
7%
82
99
85
100
80
129
141
100
90
108
108
106
117
93
83
81
115
102
102
96
108
90
108
93
101
81
90
107
99
92
79
109
105
94
96
108
102
94
105
99
121
95
82
101
116
Tre
end
Source: Packaged
P
Facts, based on data frrom August 2012
Base: 1,6
637 respondents age 18+ who go
ot pizza from anyy restaurant in the last 12 month
hs via dine-in, picckup or delivery
Survey re
espondents were
e asked the follow
wing question: P
Please think abou
ut the last time yo
ou got pizza from
m a restaurant. Did
D you
get pizza for any of the following reasons?
?
Kids:wh
heredowestart?
The presence of children stacks the deck in favor of alm
most all listed rationales for getting pizza
from a reestaurant, wiith the excepption of coupponing. Cleaarly, childrenn influence a variety of pizza
purchasee rationales, which
w
should be incorpoorated into marketing
m
meessages targeeting familiees.
Table67:Restau
urantPizzaEEatingRation
nales,ByHH
HIncome,20
012
Easy choic
ce to agree on
n w/ others
Wanted so
Easy to sh
hare with othe
ers
Had a coupon
Routine pizza night
Too late to
o cook
I had comp
pany over
TV night
Worked latte
All
45%
43%
36%
19%
18%
17%
9%
7%
7%
No
kids
93
90
102
105
76
87
93
90
82
Kids
109
113
98
94
132
118
109
113
123
Trrend
Source: Pa
b
on data fro
om August 2012 proprietary surve
ey
Base: 1,637 respondents age 18+ who got pizza from any restaurant in the
e last 12 monthss via
ckup or delivery
dine-in, pic
Survey respondents were asked
a
the following question: Ple
ease think about the last time you
u got
d you get pizza fo
or any of the follo
owing reasons?
pizza from a restaurant. Did
Septemberr 2012
75
Pizza at Foo
R
Re
estaurant Purch
hase Decision and
a
Eating Expe
erience
EatingP
Participantts,OverEaating,Prom
motions&HealthyO
OptionAwaareness
Thinking of
o the last tiime you atee pizza thatt was from a restaurantt, do any of
o the
foollowing stattements apply to your eaating experieence?
p
from any

months via
v dine-in, pickup
p
or dellivery
Family&
&kidstrum
mpeatingallone
a pizza froom a restaurrant, 7 in 100 restaurant pizza users ate with faamily.
The last time they ate
Children were a sign
nificant factoor, with rougghly 2 in 10 eating with kids and 2 in 10 eatingg with
teenagerss.
u
g the commuunal nature of
o restaurannt pizzaannd the
Only 1 in 10 ate pizzza alone, underscoring
concern that pizza purveyors are not cappturing ordeers from peeople wishinng to feed only
themselvves.
Overindulggence?Notreally.
Satisfacttion?Yes.O
With resppect to theirr pizza eatinng experiencce, just overr one half off restaurant pizza users were
very satisfied with th
heir meal, and
a about onne-third repoorting feelinng full. Annd while pizzza is
noted foor its indulg
gent qualitiees, only 133% said theey ate too much pizzaa and only 11%
overinduulged. Even fewer5%
f
felt bloatedd, and only 4%
4 felt veryy tired afterrward.
Couponingasignificantforce
a pizza froom a restaurant, 2 in 10 consumerrs used a cooupon/promootion,
underscooring both the breadth off promotionaal activity annd its acceptaance and usee.
Healthyoptions?W
Where?
p
optionss were available the lastt they
Only 1 inn 10 restauraant pizza eatters agree thhat healthy pizza
got pizzaa from a restaurant, conffirming otherr analysis inn this report suggesting
s
thhat the restaaurant
pizza inddustry is not doing enouggh to promotte or developp healthier options.
o
Septemberr 2012
76
Pizza at Foo
R
Re
estaurant Purch
hase Decision and
a
Eating Expe
erience
Graph63:Consume
erPizzaResttaurantEatiingParticipaants,OverEating,
Promotions&HealtthyOptionA
Awareness, 2012
Source
e: Packaged Fac
s
ere asked the folllowing question:: Thinking of the
e last time you ate pizza that was from a restauran
nt,
do anyy of the following statements applly to your eating experience?
participantss
Eatingp
Gender:familydifferential
Female restaurant
r
piizza eaters are
a more likely to eat piizza with kiids and teenns, while meen are
more likeely to eat it alone.
a
Table68:ConsumerPizzaRestau
urantEatinggParticipantts,ByGende
er,2012
Ate witth family
Ate witth kids
Ate witth teenagers
Ate alo
one
All
Malle
Female
e
70%
22%
19%
10%
96
6
72
2
81
127
7
103
123
116
78
Trend
Sourcce: Packaged Fa
acts, based on da
ata from August 2012 proprietaryy survey
Base: 1,637 responde
ents age 18+ who got pizza from any restaurantt in the last 12 months via dine-in
n, pickup or
ery
delive
Surve
ey respondents were
w
asked the fo
ollowing question
n: Thinking of th
he last time you ate
a pizza that wa
as from a
restau
urant, do any of the following statements apply to
o your eating exp
perience?
Septemberr 2012
77
Pizza at Foo
R
Re
estaurant Purch
hase Decision and
a
Eating Expe
erience
Age:tim
mewithchilldraisingyears
The tenddency to eat restaurant pizza
p
with children is most
m
likely among
a
25-444s, the age group
g
most likeely to have children
c
in thhe home.
Table69:Consume
erPizzaResttaurantEatin
ngParticipants,ByAge,,2012
Ate with fam
mily
Ate with kid
ds
Ate with tee
enagers
Ate alone
All
18-24
25
5-34
35-4
44
45-54
55-64
65
70%
22%
19%
10%
99
90
107
68
9
97
184
7
77
118
98
167
7
166
6
101
97
70
101
128
101
34
72
106
110
37
62
61
Tre
end
Source: Pa
b
on data fro
om August 2012 proprietary survvey
Base: 1,63
37 respondents age
a 18+ who got pizza from any restaurant in th
he last 12 monthss via dine-in, pickkup or delivery
Survey resspondents were asked
a
the following question: Th
hinking of the lasst time you ate pizzza that was from
m a restaurant, do
d any
of the follo
owing statements
s apply to your ea
ating experience?
HHIncome:familyamiddleincomeswe
eetspot
The tenddency to eat restaurant
r
piizza with fam
mily, teens annd kids is strrongest amoong $50K-$999.9K
HH incoome restauraant pizza users.
u
Thosee with <$255K HH incoome are moost likely too eat
restaurannt pizza alone.
T
Table610:C
ConsumerPizzaRestaurrantEatingP
Participants,ByHHInco
ome,2012
Ate with fa
amily
Ate with kiids
Ate with te
eenagers
Ate alone
All
<$25K
K
$25K-$49..9K
$50K-$7
74.9K
$75K--$99.9K
$10
00K+
70%
22%
19%
10%
81
86
76
184
100
91
89
105
113
3
109
9
117
7
56
105
137
123
7
73
106
9
96
111
5
55
Tre
end
Source: Packaged
P
Base: 1,6
Survey re
espondents were
e asked the follow
wing question: T
Thinking of the last time you ate pizza
p
that was fro
om a restaurant, do
any of the
e following statem
ments apply to yo
our eating experience?
Septemberr 2012
78
Pizza at Foo
R
Re
estaurant Purch
hase Decision and
a
Eating Expe
erience
Race/ethnicity
Compareed to other raace/ethnicitiees, Asian resstaurant pizzza eaters are most likely to eat pizzaa with
kids or teeenagers.
Table611:Co
onsumerPizzzaRestaurantEatingPaarticipants,B
ByRace/Ethnicity,2012
2
Ate witth family
Ate witth kids
Ate witth teenagers
Ate alo
one
All
White
Hispanic
B
Black
Asian
n
70%
22%
19%
10%
102
89
90
98
95
130
117
100
94
118
125
102
103
143
150
125
Trend
acts, based on da
ata from August 2012 proprietaryy survey
ents age 18+ who got pizza from any restaurantt in the last 12 months
m
via dine-in
n, pickup or
ery
delive
Surve
ey respondents were
w
asked the fo
ollowing question
n: Thinking of th
a pizza that wa
as from a
restaurant, do any of the following sta
atements apply to
o your eating exp
perience?
Kids
Restaurannt pizza eateers with childdren in the home
h
are alm
most twice ass likely to eaat pizza withh kids
and teenss, and only one-third
o
as likely
l
to eat it alone.
Taable612:Co
onsumerPizzzaRestauraantEatingPaarticipants,
ByyPresenceo
ofChildreninHH,2012
Ate wiith family
Ate wiith kids
Ate wiith teenagers
Ate alo
one
Alll
No kid
ds
Kids
70%
%
22%
%
19%
%
10%
%
94
24
33
152
108
199
187
32
Trend
Sourrce: Packaged Fa
acts, based on data from August 2012 proprietaryy survey
Base
e: 1,637 respondents age 18+ wh
ho got pizza from
m any restauran
nt in the last 12 months
m
via dine-in
n, pickup or
delivery
Survey respondents were
w
asked the following
f
questio
on: Thinking of th
he last time you ate pizza that wa
as from a
aurant, do any of the following sta
atements apply to
o your eating exp
perience?
resta
Septemberr 2012
79
Pizza at Foo
R
Re
estaurant Purch
hase Decision and
a
Eating Expe
erience
Overeatting,promo
otions&he
ealthyoptio
onawarene
ess
Gender
While onnly 5% of reestaurant pizzza eaters note feeling bloated
b
the last time they got restaaurant
pizza, woomen are 70
0% more likeely than menn to say so. Women
W
are also more liikely to be aware
a
of healthhier pizza availability,
a
in part beecause they may be getting
g
pizzaa from diffferent
restaurannts than men do, but becaause their grreater health--consciousneess also playys a role.
Table613:ConsumerPizzaResstaurantEating:OverEaating,Promo
otions
&HealtthyOptionA
Awareness,ByGender, 2012
I felt ve
ery satisfied with my meal
I was full
f
I ate to
oo much pizza
I over-indulged
I felt blloated
I felt ve
ery tired afterw
ward
All
51%
32%
13%
11%
5%
4%
Male
96
93
84
84
72
100
Female
e
103
106
113
113
123
100
Promo
otion/coupon wa
as used
Healthy pizza options
s were available
20%
10%
94
75
105
120
Trend
acts, based on da
ata from August 2012
2
proprietaryy survey
ents age 18+ who
o got pizza from any restaurantt in the last 12 months via dine-in
n, pickup or
d
li ey respondents were
Surve
w
asked the fo
ollowing question
n: Thinking of th
a pizza that wa
as from a
restau
urant, do any of the
t following statements apply to
o your eating exp
perience?
Age
While thhe after-effeccts of indulggence are noted
n
by a small
s
minoriity of restauurant users, these
consequeences are farr more likelyy to be felt am
mong 18-34ss (and especcially 18-24ss).
Table614:ConsumerPizzaResstaurantEating:OverEaating,Promo
otions
&HealtthyOptionA
Awareness,ByGender, 2012
I felt very satisfied
s
with my
m meal
I was full
I ate too much
m
pizza
I over-indu
ulged
I felt bloate
ed
I felt very tired
t
afterward
All
51%
32%
13%
11%
5%
4%
18--24
93
3
13
30
15
50
13
34
16
66
16
61
25-34
81
96
131
132
137
169
35-44
88
100
91
97
112
111
45-5
54
99
115
5
82
101
1
81
75
55-64
115
89
82
87
95
69
65+
127
74
82
55
23
27
Promotion
n/coupon was used
u
Healthy pizza options av
vailable
20%
10%
79
9
11
18
109
86
98
87
118
8
88
93
126
93
107
Tre
end
Source: Packaged
P
Base: 1,6
Survey re
espondents were
e asked the follow
wing question: T
p
that was fro
om a restaurant, do
any of the
e following statem
ments apply to yo
our eating experience? of the following statemen
nts apply to your eating experiencce?
Septemberr 2012
80
Pizza at Foo
R
Re
estaurant Purch
hase Decision and
a
Eating Expe
erience
HHincom
me
The tenddency to notee any after-effects of pizza indulgencce goes dow
wn as HH inccome rises, which
w
suggests better diet and
a health aw
wareness am
mong consum
mers in higheer-income brackets.
umerPizzaR
RestaurantEEating:OverrEating,Promotions&H
HealthyOpttion
Table615:Consu
A
Awareness,
ByHHIncome,2012
All
<$2
25K
$25K-$49.9K
K
$50K$74.9K
$75K$99.9K
$100K+
I felt very satisfied

s
w/ my
y meal
I was full
I ate too much
m
pizza
I over-indu
ulged
I felt bloate
ed
I felt very tired
t
afterward
51%
32%
13%
11%
5%
4%
10
04
10
04
12
20
11
11
11
16
18
86
102
111
100
120
125
74
99
96
93
92
75
75
101
92
91
79
73
86
92
88
88
78
88
72
Promotion
n/coupon was used
u
Healthy pizza options av
vailable
20%
10%
91
9
7
77
114
96
89
118
112
139
94
86
Trrend
Source: Packaged
P
Base: 1,6
hs via dine-in, picckup or delivery.
Survey re
espondents were
e asked the follow
wing question: T
p
that was fro
om a restaurant, do
any of the
e following statem
ments apply to yo
our eating experience?
Septemberr 2012
81
Pizza at Foo
R
Delivery v. Pickup,
P
Chain v.
v Independent & Menu Item Orrdering
C
Chapter7:D
Deliveryv.P
Pickup,Chain
nv.Indepen
ndent&Men
nuItemOrd
dering
INTROD
DUCTION
In this se
ection of the
e report, Pa
ackaged Faccts assessess the degree
e to which restaurant
r
p
pizza
customers use deliv
very/pickup versus
v
dine in; and cho
oose pizza chains verssus independent
pizza resstaurants and non-pizzza restauran
nts. We alsso analyze what
w
they order,
o
and how
delivery/p
pickup versu
us dine in afffects the ord
der.
INSIGH
HTCAPSU
ULE
Restauran
nt pizzas sttrong delive
ery/pick up positioning
g enables it to compete well aga
ainst
home-based options
s, as well as
a other off-premises locations, inclluding the workplace,
w
o
other
peoples homes, and
d special events: The la
ast time they ate pizza from a resttaurant, 7 in
n 10
used take
eout or delive
ery, while 3 in 10 consum
mers ate at the restaura
ant.
For many
y consumerrs, pizza is easy: Th
he last time they
t
ate pizza from a re
estaurant, so
ome
43% of co
onsumers got pizza beccause they wanted
w
som
mething easyy to serve, and
a more tha
an a
third got because
b
its easy to sha
are with othe
ers. Howeve
er, consume
ers who pickked up the pizza
p
or had it delivered
d
are
e more apt to
o value pizza
as ease of service
s
and sharing.
Pizza cha
ains have a firm grip on the res
staurant pizzza landsca
ape. The lasst time theyy ate
pizza from
m a restaura
ant, 75% of consumerss got it from a major pizzza chain, while
w
24% got
g it
from a loccal, indepen
ndent pizza restaurant. Only 2% got pizza from
m a non-pizza restaurrant.
However, local indepe
endent pizza
a restaurantts are more likely choice
es for pizza eaters
e
who dine
d
in than for those who use pick up
p or delivery.
Naturally, at pizza restaurants, pizza
p
is the draw: the la
ast time theyy got food and/or drink from
f
a pizza re
estaurant, 95
5% of consu
umers got pizzza. While pizza
p
restaurrant operato
ors often provide
a choice of other enttrees (from pasta to ch
hicken to ribs), each non-pizza entrre listed be
elow
was chossen by less than
t
2 in 10
0 customers. Pasta, cho
osen by 16%
% of customers, is the most
m
likely non-pizza choic
ce, followed by
b chicken entre,
e
and sandwich.
s
In a sea of
o less healtthy choices, salad diffe
erentiates ittself as a he
ealthy optio
on. Its prese
ence
does not go unnotice
ed: among listed non-p
pizza food options,
o
sala
ad was the most preva
alent
choice, with
w one-third
d of custom
mers ordering
g a salad th
he last time they got fo
ood/drink from a
pizza resttaurant.
es provide a needed
d shot in the
t
arm to
o restauran
nt margins.. So, for pizza
p
Beverage
restaurants, the fact that under half
h of custo
omers ordere
ed a non-alccoholic drinkk is not the best
b
news. Th
his is partially due to th
he lower pre
evalence of beverage ordering
o
am
mong those who
w
choose delivery/picku
up. In the wake
w
of othe
er restaurantts benefitting from high
her-priced, more
m
sophistica
ated, and/or higher-quality beverage
es, pizza resstaurants sho
ould be follow
wing suit.
While delivery/pickup
p has helpe
ed pizza gro
ow sales beyond the establishme
ent, the bill per
person is likely much
h higher when dining. Dining
D
in trranslates to
o an averag
ge order off 3.5
items, ve
ersus 2.7 forr takeout an
nd delivery.. It also corre
elates to a greater
g
prope
ensity to ord
der a
listed food
d items and drinks. The
e flipside is that
t
the indu
ustry can continue to lea
arn how to grow
g
the delive
ery basket accordingly.
a
While coup
poning is already a we
ell-entrenche
ed industry tool,
t
pizza purvveyors can experiment
e
w targeted
with
d marketing that matche
es promotion
ns for additio
onal
purchasess to previous
s dining history or statisttically generrated food orrdering assu
umptions.
Septemberr 2012
82
Pizza at Foo
R
Delivery v. Pickup,
P
Chain v.
Introdu
uction
In this seection of thee report, as part
p of its August
A
2012 proprietary consumer survey,
s
Packkaged
Facts asssesses the deegree to whicch restaurantt pizza custoomers use deelivery/pickuup versus dinne in;
and chooose pizza chaains versus independent pizza restauurants and noon-pizza resttaurants. Wee also
analyze what
w they orrder, and how
w delivery/pickup versuss dine in affeects the ordeer.
Specifically, we asked suurvey responndents age 18+ who gott pizza from any restaaurant
2 months via dine-in, pickup or delivery the foollowing quuestion: Thee last
inn the last 12
tiime you ate pizza that was
w from a restaurant, did you gett eat at the restaurant or
o use
taakeout/deliveery?
Survey respo
ondents weree also askedd the following questionn: Which restaurant
r
did the
fr
Choicces includedd the followiing: Dominoos; Papa Johhns; Pizza Hut;
pizza come from?
L
Little
Caesarrs; Papa Murphys;
M
S
Sbarro;
Ciccis Pizza; Godfatherss Pizza; Huungry
H
Howies;
oth
her pizza restaurant
r
chhain; local,, independeent pizza reestaurant; a fast
foood/quick-seervice restauurant that does
d
not sppecialize in pizza; a faamily or uppscale
reestaurant thaat does not specialize in pizza; I dont know
w. Tabled reesults have been
agggregated frrom these ressponses.
nalyze the results to these questions, as captured in the tabless below.
2.5time
esmorepe
eoplechoo
osedeliverythandin
ningin
While reestaurant pizzza has it chhallenges, itts strong deelivery/pick up positioning enables it to
compete well againstt home-baseed options, as
a well as otther off-prem
mises locatioons, includinng the
workplacce, other peo
oples homess, and speciaal events. Thhe sale is made easier viaa price pointts and
promotioons among many
m
major pizza chainns that bringg the cost off a restaurannt pizza dow
wn to
levels haard for value--conscious, convenience
c
e-driven consumers to reesist.
a pizza from
m a restauraant, 7 in 10 used takeouut or deliverry, while 3 in 10
H incomes, Asian consuumers and urban
u
consumers ate at thee restaurant.. Those withh $75K+ HH
w
18-244s, those with <$25K+
+ HH
consumers are moree likely to eat at the restaurant, while
c
arre more likelly to use takkeout/deliverry.
incomes,, and black consumers
Septemberr 2012
83
Pizza at Foo
R
Delivery v. Pickup,
P
Chain v.
Table71:PizzaaProcureme
ent:Restauraantv.Takeo
out/Deliveryy,
Demograph
hicAssessme
ent,2012
At resta
aurant
Tak
keout/deliverry
All
29%
%
71%
Male
Fem
male
95
104
4
102
98
18-2
24
25-3
34
35-4
44
45-5
54
55-6
64
65+
+
78
101
1
106
6
90
116
6
104
4
109
99
97
104
93
98
<$2
25K
$25
5K-$49.9K
$50K-$74.9K
$75
5K-$99.9K
$100K+
79
91
103
3
115
5
127
7
109
104
99
94
89
Tota
al (Index)
Whiite
Hisp
panic
Blacck
Asia
an
100
0
104
4
102
2
63
127
7
100
99
99
115
89
No kids
Kidss
95
106
6
102
98
Urban
Sub
burban/outer suburbs
s
Rurral
109
9
96
97
96
102
101
acts, based on data from August 2012 proprietaryy survey
Base
e: 1,622 respondents age 18+ wh
ho got pizza from
m a restaurant in the last 12 months via eat-in or ta
akeout/delivery.
Survvey respondents were
w
asked the following
f
questio
on: The last time
e you ate pizza th
hat was from a re
estaurant, did you
get eat
e at the restaurrant or use takeo
out/delivery?
Septemberr 2012
84
Pizza at Foo
R
Delivery v. Pickup,
P
Chain v.
Moretaakeout/deliveryusersinfluenced
dbyeaseo
ofpizzafacctors
For manyy consumerss, pizza is eeasy: The last time theyy ate pizza from
f
a restaaurant, some 43%
of consum
mers got pizzza because they wantedd something easy to servve, and moree than a thirrd got
because its easy to share with others.
o
How
wever, consuumers who picked
p
up thhe pizza or had
h it
deliveredd are more apt
a to value pizzas easee of service and sharingg. Ease and conveniencee can
continue to be used to pizza delivverys competitive advanntage.
Table7
72:ConsumerRestaurantPizzaEatingRationales,byEatInv.Takeoutt/Delivery,2
2012
Easy choicce to agree on with others
Wanted so
Easy to sh
hare with othe
ers
Had a coupon
Routine pizza night
Too late to
o cook
I had comp
pany over
TV night
Worked late
Other
All
45%
43%
36%
19%
18%
17%
9%
7%
7%
9%
At restau
urant
88
58
89
73
107
81
80
51
92
157
Tak
keout/deliverry
105
117
104
111
97
108
108
120
103
76
Tren
nd
Source: Pa
b
on data fro
om August 2012 proprietary surve
ey
Base: 1,622 respondents age
a 18+ who got pizza from a restaurant in the lasst 12 months via dine-in, pickup or
o delivery.
Survey resspondents were asked
a
the following question: Ple
ease think about the last time you
u got pizza from a restaurant. Did
d you
get pizza fo
or any of the follo
owing reasons?
Column va
ariables represent consumers who
o, the last time they
t
got pizza fro
om a restaurant, 1) ate it At resta
aurant or 2) use
ed
Takeout/delivery.
Septemberr 2012
85
Pizza at Foo
R
Delivery v. Pickup,
P
Chain v.
Pizzach
hainsdomiinate
Pizza chaains have a firm grip onn the restauraant pizza lanndscape. Forr the purposees of this suurvey,
major chain
c
includ
des Dominoos; Papa Joohns; Pizza Hut; Littlle Caesars; Papa Murpphys;
Sbarro; Cicis
C
Pizza; Godfatherss Pizza; Hunngry Howies; and otherr pizza restaaurant chain.
The last time
t
they atee pizza from
m a restaurannt, 75% of coonsumers got it from a major
m
pizza chain,
c
while 244% got it fro
om a local, independent
i
pizza restauurant. Onlyy 2% got pizzza from a non
pizza reestaurant (a QSR, familyy or upscalee restaurant that does noot specializee in pizza). Older
O
consumers are geneerally more likely to get
g pizza from
fr
local independent
i
s and non-pizza
restaurannts, as are hig
gher-incomee consumers. 18-34s andd non-white consumers are
a most likeely to
use majoor pizza chain
ns.
ent:MajorPizzaChain,LLocalIndepe
endentPizzaaRestaurantt,
Table73:PizzaaProcureme
NonPizzaR
Restaurant,Demograph
hicAssessme
ent,2012
Pizza cha
ain
75%
ent
Local independe
pizzza restauran
nt
24%
Non-pizza restaura
ant
2%
Male
Female
100
100
99
101
106
95
18-24
25-34
35-44
45-54
55-64
65+
117
112
97
99
90
88
50
64
110
99
128
137
34
47
81
140
175
105
<$25K
$25K-$4
49.9K
$50K-$7
74.9K
$75K-$9
99.9K
$100K+
+
113
101
99
94
88
64
100
99
118
134
18
58
159
124
186
White
Hispanic
Black
Asian
95
110
116
115
116
71
45
58
106
58
153
0
No kids
Kids
95
106
115
80
92
110
Urban
Suburba
an/outer subu
urbs
Rural
105
96
104
87
110
92
55
146
42
All
Source:: Packaged Facts

s, based on data
a from August 20
012 proprietary su
urvey
g pizza from a restaurant in the
e last 12 months via dine-in, picku
up or delivery.
Survey respondents were asked the follo
owing question: Which restauran
nt did the pizza come
c
from? Cho
oices included th
he
a Hut; Little Caessars; Papa Murp
phys; Sbarro; Ciccis Pizza; Godfa
athers Pizza; Hu
ungry
following: Dominos; Papa Johns; Pizza
staurant chain; lo
ocal, independent pizza restauran
nt; a fast food/quick-service resta
aurant that does not
n
Howiess; other pizza res
specialize in pizza; a fam
mily or upscale restaurant that do
oes not specialize in pizza; I dont know.
Septemberr 2012
86
Pizza at Foo
R
Delivery v. Pickup,
P
Chain v.
Eatingo
onsitemore
elikelyatlo
ocalindepe
endentsandonpizzarestaurantts
Local inddependent piizza restauraants are more likely choiices for pizzza eaters whoo dine in thaan for
those whho use pick up
u or deliveryy.
Table
e74:PizzaProcuremen
nt:MajorPizzzaChain,Lo
ocalIndependentPizzaRestaurant&
NonPizzaRe
N
estaurant,byyEatInv.Taakeout/Deliivery,2012
Major pizzza chain
Local ind
dependent piz
zza restaurantt
Non-pizzza restaurant
A
All
75
5%
24
4%
2
2%
At re
estaurant
84
141
260
Takeout/delivery
T
107
83
34
Trend
Source: Packaged
P
Facts, based on data from
f
August 2012
2 proprietary surrvey
Base: 1,6
ot pizza from a re
estaurant in the la
ast 12 months viia dine-in, pickup
p or delivery.
Survey resp
pondents were asked
a
the followin
ng question: Wh
hich restaurant did the pizza come from? Choices included the
following: Dominos;
D
Papa Johns;
J
Pizza Hu
ut; Little Caesarss; Papa Murphyss; Sbarro; Cicis Pizza; Godfathers Pizza; Hungryy
Howies; other pizza restaurant chain; local,, independent pizzza restaurant; a fast food/quick-service restaurant that does not
y or upscale resta
aurant that does not specialize in pizza; I dont kn
now. Tabled results have been
specialize in pizza; a family
d from these resp
ponses.
aggregated
So,whatdidyouo
orderatthe
epizzarestaaurant?
Naturallyy, at pizza reestaurants, pizza
p
is the draw:
d
the lasst time they got food andd/or drink frrom a
pizza restaurant, 95%
% of consum
mers got pizzaa.
Nonpizzzaentres,,inaggregaate,contrib
butestronglytoorder
While pizzza restauran
nt operators often providde a choice of
o other entrrees (from paasta to chickken to
ribs), eacch non-pizza entre listted below was
w chosen by less thaan 2 in 10 customers.
c
P
Pasta,
chosen by
b 16% of customers, iss the most liikely non-piizza choice, followed byy chicken enntre,
and sanddwich.
Salad:th
hehealthyholdout
In a sea of less healtthy choices, salad differrentiates itseelf as a healtthy option. Its
I presence does
not go unnnoticed: am
mong listed non-pizza
n
foood options, salad
s
was thee most prevaalent choice,, with
one-thirdd of customeers ordering a salad the laast time theyy got food/drrink from a pizza
p
restaurrant.
Drinks,p
please
Beveragees provide a needed shoot in the arm
m to restaurannt margins. So, for pizza restaurantss, the
fact that under half of customers ordered a non-alcohoolic drink iss not the beest news. Thhis is
partially due to th
he lower prevalence of
o beveragee ordering among thoose who chhoose
delivery//pickup. In the wake of other restaurants benefitting from highher-priced, more
sophisticcated, and/or higher-quallity beveragees, pizza resttaurants shouuld be follow
wing suit.
Septemberr 2012
87
Pizza at Foo
R
Delivery v. Pickup,
P
Chain v.
Graph71:FFoodandDrrinkOrdered
dDuringLasstVisittoPizzzaRestauraant,2012
Source
e: Packaged Fac
s
nts age 18+ who got food/drink frrom a pizza resta
aurant in the last 12 months.
ere asked the folllowing question:: The last time you
y got food and//or drink from a pizza
p
restaurant, did
you ord
der any of the following?
Septemberr 2012
88
Pizza at Foo
R
Delivery v. Pickup,
P
Chain v.
Largero
orders:youn
ngerpatron
ns
Younger pizza restaaurant users are more likely
l
to ordder a varietty of menu items, incluuding
appetizerrs, soups, a range of noon-pizza entres, and noon-alcoholicc drinks. Onn average, 255-34s
order thee most listed menu itemss (3.7), aheadd of 18-24s (3.4)
(
and muuch higher thhan any otheer age
group. Saalads are mo
ost likely orddered by 25-444s.
Tab
ble75:Food
dandDrinkO
OrderedDuringLastVissittoPizzaR
Restaurant,b
byAge,2012
Pizza
a
All
95%
%
18-24
102
25-34
2
103
35-44
100
0
45-54
98
55-64
98
65
5
99
9
Salad
d
Appettizer
Soup
33%
%
25%
%
6%
93
160
175
124
160
209
116
6
134
4
103
3
98
89
64
85
50
43
80
0
26
6
41
Pasta
a
Chickken entre
Sandw
wich
Fish/sseafood entre
e
Ribs
Beef entre
16%
%
11%
%
10%
%
4%
3%
3%
157
140
132
114
206
180
175
163
126
213
228
253
113
3
116
6
147
7
119
9
104
4
116
6
81
98
100
84
33
55
60
61
56
44
52
23
36
6
35
5
44
4
34
4
30
0
11
Desse
ert
16%
%
204
152
115
5
82
57
28
8
Non-a
alcoholic drink
Alcoh
holic drink
47%
%
12%
%
115
75
114
168
105
5
104
4
105
85
84
80
81
84
4
Otherr
6%
126
39
107
7
123
111
95
5
2.8
3.4
3.7
3.1
2.6
2.2
2.0
Num
mber of items orrdered*
Trend
*Nott including otherr

Sourrce: Packaged Facts, based on data
d
from Augustt 2012 proprietarry survey
Base
e: 1,857 respond
dents age 18+ wh
ho got food/drinkk from a pizza resstaurant in the la
ast 12 months.
Survvey respondents were asked the following questio
on: The last time
e you got food an
nd/or drink from a pizza
resta
aurant, did you order
o
any of the fo
ollowing?
Septemberr 2012
89
Pizza at Foo
R
Delivery v. Pickup,
P
Chain v.
HHIncom
me
$100K+ HH incomee pizza restaaurant userss are more likely to orrder a rangee of menu ittems,
includingg salads, sou
up, fish/seafoood entres, ribs and beeef entrees, ass well as alcooholic drinks. On
average, $100K+ HH
H income piizza restauraant users ordder the mostt listed menuu items (3.1)), the
o which decclines with HH
H income.
number of
Table76
6:FoodandDrinkOrderedDuringLLastVisittoPizzaRestaurant,
byHH
HIncome,20
012
Pizza
All
95%
<$25K
99
$25K$49.9K
100
$50K$74.9K
$
101
75K$7
$9
99.9K
99
$100
0K+
10
02
Salad
Appetizer
Soup
33%
25%
6%
84
98
97
99
99
62
96
101
119
117
1
1
114
92
118
94
4
15
51
Pasta
Chicken
n entre
Sandwicch
Fish/sea
afood entre
Ribs
Beef en
ntre
16%
11%
10%
4%
3%
3%
84
109
103
74
108
88
91
73
90
67
66
67
109
115
105
127
115
137
115
1
1
109
1
117
1
105
95
1
106
116
10
08
93
3
15
56
13
31
12
23
Dessertt
16%
91
110
102
94
98
8
Non-alccoholic drink
Alcoholiic drink
47%
12%
89
69
101
90
101
107
103
1
1
131
10
09
12
29
Other
6%
93
103
123
95
81
1
Numberr of items ordered*

*Not including other
2.8
2.6
2.7
2.9
3
3.0
3.1
Trend
Source
e: Packaged Factts, based on data
a from August 20
s
Base: 1,857
1
responden
nts age 18+ who got food/drink fro
om a pizza resta
aurant in the last 12 months.
ere asked the following question: The last time yo
ou got food and//or drink from a pizza
p
restaurant, did
you ord
der any of the following?
Septemberr 2012
90
Pizza at Foo
R
Delivery v. Pickup,
P
Chain v.
Race/eth
hnicity
Asian pizzza restauran
nt users are more
m
likely to
t order mosst of the listeed menu item
ms, but especcially
soup, passta, chicken entres and ribs. On aveerage, they also
a orderedd the most iteems (3.3) the last
time theyy got food an
nd/or drink from
f
a pizza restaurant.
Table77
byRace
e/Ethnicity,2012
Pizza
All
95%
White
100
Hispa
anic
100
0
Black
101
Asian
101
Salad
Appetizer
Soup
33%
25%
6%
102
100
8
82
98
8
100
0
145
5
94
92
114
93
115
237
Pasta
Chicken entrre
Sandwich
Fish/seafood
d entre
Ribs
Beef entre
16%
11%
10%
4%
3%
3%
84
8
7
74
9
93
7
76
7
73
7
76
155
5
152
2
116
6
164
4
151
1
182
2
113
187
124
176
187
139
167
158
105
108
165
138
Dessert
16%
8
88
124
4
147
110
Non-alcoholic drink
Alcoholic drink
47%
12%
99
9
101
94
4
97
7
107
91
118
121
Other
6%
104
95
5
67
134
Number of ittems ordered*
2.8
2
2.7
3.1
3.1
Trend
3.3
*Not includin
ng other
Source: Pack
kaged Facts, bassed on data from August 2012 pro
oprietary survey
Base: 1,857 respondents
r
age
e 18+ who got foo
od/drink from a pizza
p
restaurant in the last 12 mo
onths.
Survey respo
ondents were askked the following
g question: The last
l
time you gott food and/or drin
nk from a
pizza restaurrant, did you orde
er any of the follo
owing?
Septemberr 2012
91
Pizza at Foo
R
Delivery v. Pickup,
P
Chain v.
Menuorrdering:Eatingatrestau
urantv.take
eout/deliverry
While deelivery/picku
up has helpeed pizza aggrressively groow sales outtside of pizza establishm
ments,
the bill per
p person is
i likely muuch higher when
w
diningg in versus taking the order
o
to go.. The
bottom liine is that dining in transslates to an average
a
ordeer of 3.5 item
ms, versus 2.7 for takeouut and
delivery. It also correelates to a grreater propennsity to ordeer a listed foood items andd drinks.
The flipside is thatt the industtry can conntinue to leearn how too grow the delivery basket
b
accordinggly. While couponing
c
is already a well-entrenched industrry tool, pizzza purveyorss can
experimeent with targ
geted marketiing that matches promottions for addditional purchhases to prevvious
dining hiistory or stattistically gennerated food ordering asssumptions.
Table78
byyEatInv.Taakeout/Deliivery,2012
Pizza
All
96%
At restaurantt
100
Takeo
out/delivery
100
Salad
Appetizer
Soup
35%
27%
7%
142
106
156
83
98
77
Pasta
C
Chicken
entre
Sandwich
Fiish/seafood en
ntre
R
Ribs
Beef entre
18%
12%
11%
4%
4%
3%
135
117
95
146
131
177
86
93
102
81
87
68
Dessert
17%
121
91
Non-alcoholic drrink
Alcoholic drink
49%
13%
125
182
90
66
O
Other
6%
56
118
Trend
2.9
3.5
2.7
*Not including other
Source: Package
ed Facts, based on data from Au
ugust 2012 proprrietary survey
Base: 1,857 resp
pondents age 18
8+ who got food/d
drink from a pizzza restaurant in th
he last 12 month
hs.
Survey responde
ents were asked the following qu
uestion: The lastt time you got foo
od and/or drink frrom a pizza
restaurant, did you
y order any of the
t following?
Number of items
s ordered*
Septemberr 2012
92
Pizza at Foo
R
Pizzza Uptake Motiv

vators
C
Chapter8:P
PizzaUptake
eMotivatorss
INTRODUCTION
In this section of the report, Packkaged Factss assesses what

w
would motivate co
onsumers to eat
more pizzza, focusing on five posssibilities: he
ealthier pizzza, personal size pizza, more option
ns I
can eat on the go, international/ethnic pizza options,
o
or more
m
gluten
free pizza options.
o
INSIGH
HTCAPSU
ULE
Healthierr pizza needed to increase usag
ge. Health may
m
not be a dirty worrd for the pizza
p
industry, especially if it wants to
o grow sale
es: Some 4 in 10 conssumers say healthier pizza
p
options would
w
entice
e them to ea
at pizza mo
ore often. Demonstratin
D
ng the niche
e importance
e of
gluten-fre
ee pizza, 7%
% of pizza ea
aters would eat
e pizza mo
ore often if there
t
were more
m
gluten--free
options. This may resonate esspecially well among women, 18
8-34s, $75K
K+ HH inco
ome
consumerrs, Asian con
nsumers and
d Hispanic consumers.
c
Personal sizing a drraw. Anothe
er 25% say personal
p
size pizzas wo
ould do the trick,
t
suggessting
interest in
n controlling portion size
e and food waste,
w
as we
ell meeting the
t needs of
o those who
o eat
pizza alo
one. This may
m
resona
ate especially well among 18-34ss and <$25
5K HH inco
ome
consumerrs.
On-the-go convenie
ence becko
ons. The desire
d
for on-the-go food
f
optionss translatess to
increasing
g pizza sale
es potential, at least with
h respect to the 20% off consumerss who would
d eat
pizza morre often if more on-the-g
go options were
w
available. While pizza by the slice
s
is definitely
less cumbersome th
han the trad
ditional sma
all, medium or large sizzed pizza, the pizza crust
c
provides a strong fou
undation for on-the-go experimenta
e
ation, be in the
t
form of wraps, burrritos,
rolls or otther permuta
ations. This may resona
ate especiallly well amon
ng men, 18--34s, <$25K
K HH
income co
onsumers, black
b
consum
mers and Assian consumers.
An interrnational/etthnic twistt worth pursuit. On
nly 12% of pizza ea
aters say that
international/ethnic pizza optionss would mottivate them to
t eat pizza
a more often
n. However, this
may be due to consumers perception of pizzza as a tradittional food with
w longstan
nding and sta
able
ingredientt and preparration qualities. Introduccing consumers to ingred
dient and prreparation sttyles
found acrross the wo
orld may yie
eld unexpeccted benefitts. This ma
ay resonate especially well
among men, 18-34s, $100K+ HH income con
nsumers, and non-white consumers.
But incre
easing pizz
za uptake is
i a hard sell
s
to som
me. More th
han 1 in 4 consumers are
nonplusse
ed about an
ny of these options,
o
sayying that non
ne of them would
w
motivvate them to
o eat
more pizzza. With pizza
p
use and pizza restaurant use nearlyy universal, this is quite
q
understan
ndable: som
me people ha
ave enough
h pizza. The
e key involve
es giving co
onsumersb
both
those who say they are open to
o these usa
age motivato
ors and thosse who say they are not
something
g new.
Healthy food
f
& hom
me cooked meals trend
d translates to increase
ed motivation
n to eat hea
althy
pizza and
d internation
nal/ethnic pizza. Those eating lesss healthy food and lesss home coo
oked
meals, on
n the other hand,
h
are more
m
apt to be
b motivated
d to eat mo
ore pizza witth personal size
pizzas and on-the-go options.
Septemberr 2012
93
Pizza at Foo
R
Pizzza Uptake Motiv

vators
Introdu
uction
In this seection of thee report, as part
p of its August
A
2012 proprietary consumer survey,
s
Packkaged
Facts asssesses what would
w
motivvate consum
mers to eat more
m
pizza, focusing
f
on five
f
possibillities:
healthier pizza, perso
onal size pizzza, more opptions I can eat on the go,
g international/ethnic pizza
options, or
o more gluttenfree pizzza options.
Summarryanalysis
Healthierpizzaneed
dedtoincreaaseusage
Health may
m not be a dirty word for
f the pizzaa industry, especially if it wants to grow
g
sales: Some
S
4 in 10 consumers say healthier pizza opptions wouldd entice theem to eat piizza more often.
o
Demonsttrating the niche
n
importtance of gluuten-free pizzza, 7% of pizza
p
eaters would eat pizza
more ofteen if there were
w more gluuten-free options.
Personallsize
Another 25% say personal sizee pizzas would do the trick, suggeesting intereest in controolling
portion size and food
d waste, as well
w meeting the needs off those who eat pizza aloone.
Ontheggoconvenien
nce
The desirre for on-thee-go food opptions transllates to increeasing pizzaa sales potenntial, at leastt with
respect too the 20% off consumers who would eat pizza more
m
often if more on-thee-go options were
availablee. While piizza by the slice is deffinitely less cumbersom
me than the traditional
t
s
small,
medium or large siized pizza, the pizza crust providdes a stronng foundatioon for on-thhe-go
experimeentation, be in
i the form of
o wraps, buurritos, rolls or
o other perm
mutations.
national/eth
hnictwist
Anintern
Only 12%
% of pizza eaters
e
say that internatioonal/ethnic pizza
p
optionss would mottivate them to
t eat
pizza moore often. Ho
owever, thiss may be duue to consum
mers percepption of pizza as a tradittional
food withh longstandiing and stablle ingredientt and preparaation qualities. Introducing consumeers to
ingrediennt and preparration styles found acrosss the world may yield unexpected
u
b
benefits.
me
Butaharrdselltosom
But moree than 1 in 4 consumerss are nonplussed about any
a of these options, sayying that none of
them woould motivatte them to eat
e more pizzza. With piizza use andd pizza restaaurant use nearly
n
universall, this is quitte understanndable: somee people have enough pizzza. The keyy involves giving
g
consumersboth tho
ose who say they are open to these usage
u
motivators and thoose who sayy they
something new.
n
are not
Septemberr 2012
94
Pizza at Foo
R
Pizzza Uptake Motiv

vators
Graph81::MotivatorsstoEatPizzaaMoreOfte
en,2012
Source
e: Packaged Fac
s
nts age 18+ who eat pizza.
ere asked the folllowing multi-sele
ect question: Wh
hat would motiva
ate you to eat pizzza more often?
Gender
By gendeer, women are
a more apt to respond to
t healthier pizza
p
optionns, whereas men
m are morre apt
to be mottivated by on
n-the-go opttions and international/etthnic options.
Table81:MotivvatorstoEatPizzaMore
eOften,byG
Gender,201
12
Healthier piz
zza
Personal size pizza
More options
s I can eat on the
t go
Internationall/ethnic pizza options
o
More gluten
free pizza opttions
Other
None of thes
se
All
41%
25%
20%
12%
7%
12%
27%
Male
86
103
112
113
106
93
110
Female
112
98
90
90
95
106
92
T
Trend
Source: Pac
ckaged Facts, ba
ased on data from
m August 2012 proprietary
p
surveyy
Base: 1,947
7 respondents ag
ge 18+ who eat pizza.
p
Survey resp
pondents were assked the following multi-select qu
uestion: What wo
ould motivate yo
ou to eat
pizza more often?
Septemberr 2012
95
Pizza at Foo
R
Pizzza Uptake Motiv

vators
Age:exp
perimentw
withyouth
The tenddency for heaalthier pizzaa, on-the-go options andd internationnal/ethnic options to mottivate
pizza usee is highest among
a
youngger consumeers.
Table82:MotivatorstoEEatPizzaMo
oreOften,byyAge,2012
Healthie
er pizza
Persona
al size pizza
More op
ptions I can eat on the go
Internatiional/ethnic piz
zza options
More glu
utenfree pizza
a options
Other
None of these
All
41%
25%
20%
12%
7%
12%
27%
18-24
4
112
152
192
114
82
54
44
25-34
112
132
143
137
110
94
63
35-44
108
91
103
106
98
103
93
45-5
54
98
8
82
2
96
6
106
6
120
0
111
1
104
4
55-64
94
86
60
96
110
123
122
65+
81
83
43
49
72
98
150
Tren
nd
Source
e: Packaged Factts, based on data
a from August 20
s
Base: 1,947
1
responden
nts age 18+ who eat pizza.
ere asked the folllowing multi-sele
ect question: Wh
hat would motivate you to eat pizzza more often?
HHIncome:health
hhitshighernotes
The call for healthiier pizza is most prevaalent amongg $75K+ HH
H income consumers,
c
w
while
personal size pizza and
a on-the-ggo options motivate
m
a wider
w
percenntage of <$25K+ HH inccome
consumers.
Table83:MotivaatorstoEatP
PizzaMoreO
Often,byHH
HIncome,2012
Healthier pizzza
Personal size
e pizza
More optionss I can eat on the go
International/ethnic pizza options
o
More gluten
free pizza options
Other
None of thesse
All
4
41%
2
25%
2
20%
12%
7%
12%
2
27%
<$25K
K
84
116
119
89
69
110
102
$25K$49.9K
98
102
108
103
146
107
93
$50K$74.9K
103
100
105
98
98
82
110
$75K$99.9K
116
87
66
95
111
107
98
$100K+
112
82
77
118
62
90
99
T
Trend
Source: Pacckaged Facts, ba

ased on data from
m August 2012 proprietary
p
surveyy
Base: 1,947
7 respondents ag
ge 18+ who eat pizza.
p
Survey resp
pondents were as
sked the following multi-select qu
uestion: What wo
ould motivate you to eat pizza mo
ore often?
Septemberr 2012
96
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Pizzza Uptake Motiv

vators
Race/ethnicity
Hispanicc consumers are more appt than averaage to responnd to healthier pizza, on--the-go pizzaa and
internatioonal/ethnic pizza.
p
Blackk consumerss, on the othher hand, arre incented by personall size
pizza, onn-the-go pizzza, and moree gluten-freee options. Assian consumeers are also more likely to be
interestedd in internatiional/ethnic pizza, as weell as on-the--go pizza.
Table84:Motivato
orstoEatPizzzaMoreOfften,byRace
e/Ethnicity,2012
Healthier pizza
Person
nal size pizza
More options
o
I can ea
at on the go
Interna
ational/ethnic piizza options
More glutenfree pizz
za options
Other
None of
o these
All
41%
25%
20%
12%
7%
12%
27%
White
95
93
85
89
94
114
109
Hiispanic
117
106
118
123
106
72
78
Black
100
139
148
117
130
6
69
8
80
Asia
an
127
7
93
3
179
9
177
7
95
5
21
67
7
Trend
d
Sourcce: Packaged Fac

cts, based on da
ata from August 2012
2
proprietary survey
ents age 18+ who
o eat pizza.
Surve
ey respondents were
w
asked the fo
ollowing multi-sellect question: W
What would motivate you to eat pizzza more often?
Healthyfoods&ho
omecookedmeals:trendsontherise
Accordinng to our survey results, almost 4 inn 10 consum
mers are eatting more heealthy foods than
they werre a few yeears ago, annd almost as
a many are eating moree home cookked meals
twin
responses to the evollving food heealth trend and
a recessionn-driven spending patterrns.
Grap
ph82:FoodConsumptio
onTrends:EEatingMore
e,Same&Le
ess
Sou
F
etary survey
a
ompared to a few
e, less, or the
sam
me amount of the
ese foods or food
d preparation me
d a listed food
p
mark doe
es not apply. Only responses fo
or healthy food and home
coo
oked meals are shown.
s
Septemberr 2012
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Pizzza Uptake Motiv

vators
Significaanteffecto
onpizzaupttakemotivaators
Since eatting healthy
y food and eating
e
more home cookked meals arre such prevvalent trendss, we
cross-tabbbed responsses (shown below) to find out hoow these treends impactt what motiivates
people too eat pizza more
m
often.
ngtranslatestohealthyypizzamotivvation
Morehealthfuleatin
s
thhe need for more healthhful pizza offferings, we find that heealthy
Reinforcing results suggesting
food & home
h
cookin
ng interest traanslates to healthy
h
pizzaa motivation. It also trannslates to a higher
h
propensitty for internaational/ethniic pizza motivation.
Lesshealthyeatingttranslatesto
opersonalsizeandontthegopizzamotivation
n
Those eaating less heaalthy food annd less homee cooked meeals, on the other
o
hand, are
a more apt to be
motivated to eat morre pizza withh personal sizze pizzas andd on-the-go options.
Tab
ble85:FoodConsumpttionTrends::EatingMorre,Same&LLess:
MotivatorstoEatPizzaaMoreOften
Healthier pizza
Personal size pizza
More options I can eat on
o the go
Internatio
onal/ethnic pizz
za options
More gluttenfree pizza options
Other
None of these
All
A
4
41%
2
25%
2
20%
12%
7
7%
12%
2
27%
ore
Mo
health
hy food
14
44
9
99
10
03
14
41
15
54
9
97
6
61
Less
he
ealthy food
85
131
148
99
106
86
87
More ho
ome
cooked meals
m
123
108
110
123
144
122
66
s home
Less
cooke
ed meals
99
113
133
79
101
77
97
Source: Packaged Facts, based on data from August 201

Base: 1,9
947 respondents
s age 18+ who ea
at pizza.
Survey respondents
r
were
e asked the follo
owing multi-selecct question: Wha
at would motivate
e you to eat pizza
a more often?
This que
estion set has been cross-tabbed by another quesstion, as reflected
d in the column variables.
v
The qu
uestion is as follo
ows:
Comparred to a few yearrs ago, are you eating
e
more, lesss, or the same am
mount of these fo
oods or food prep
paration methodss? If you
have nott eaten a listed fo
ood or used a listted food method at all in the pastt few years, please mark does no
ot apply. One of
o the
choices was
w healthy foo
od; another was home cooked meals.
m
Response
es for the same amount and do
oes not apply arre not
shown
Septemberr 2012
98
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Retail Pizza Manufactturer, Brand & New

N
Product An
nalysis
Chapter9
9:RetailPizzzaManufactturer,Brand
d&NewPro
oductAnalyssis
Introducction
kaged Facts analyses froozen pizza sales and prroduct trendds among Nestl,
N
Schwan and
a General Mills, the thhree largest frozen
f
pizzaa manufacturrers by FDM
Mx sales.
Summarryanalysis
During 2006-2012,
2
frozen
f
5 from 63%
% to 66%. More
M
r
times a month
m
rose 15%.
1
Howevver, nearer-tterm trends suggest decllining penetration (downn 1%
during 20010-2012) an
nd engagem
ment (1+ per month
m
use down
d
2%; 5+
+ per month use
u down 4%
%).
NestlUSA
c
Through 2012, Nesttl USA hass dominatedd the pizza category
W
N
USA to the top of
o this
category,, with $1.38 billion in saalesa 45.4%
% share of SymphonyIR
S
RI-tracked saales.
c
salles, Nestl sales
But agaiinst the bacckdrop of a 2.6% deccline in frozzen pizza category
underperrformed, dropping 4.8% during the year
y
ending July 8, 2012. While thee decline weeights
to its supper-premium
m brands, onnly Nestlss regular DiG
Giorno brannd outperforrmed the maarket,
with a 2.4%
2
drop in sales. Suuperpremium
m offering offerings foound tough going, withh the
Californiia Pizza Kitcchen brand sales down 15.5% and thhe DiGiorno Ultimate linne extension sales
down 29.3%. But salles of its maainstream Toombstone braand also decclined 9.6%,, while the Jacks
J
and Stouuffers brandss declined onnly 0.4% and 2.5%, resppectively.
30% during 2006-20
2
s
shows
s
posiition.
DiGiornoo brand usaage is drivenn by 18-34ss, black andd Asian connsumers, aduults with <$$50K
householld incomes, households with children, and thosse living in the southeaast and southhwest
United States. Indexiing at 330, black
b
consum
mers are moore than 3 tim
mes as likelyy to eat DiGiorno
5+ times per month. Indexing at 188, <$25K
K HH incomee consumerss are almost twice as likeely to
eat DiGioorno 5+ timees per monthh.
Septemberr 2012
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Product An
nalysis
mulate familly-style meaals, DiGiornno offers DiGiorno Pizzza & Sidess that
w
sides like
l
ntroduced Dipping
D
Stripps, 12-pull appart strips of
p
dipping sauces,
s
o the
pizza expperience. Neestl is also launching thhree premiuum pizza undder its DiGioorno Italian style
line: meaatball marinaara, chicken parmesan annd meat trio..
In additiion to framiing itself ass restaurant competitionn, DiGiorno is positioniing itself foor the
sports fann. In Februaary 2012, DiiGiorno launnched its Coountdown to Greatness promotion
p
d
during
football championshi
c
ip season, where
w
playerrs could enteer a sweepstaakes to win prizes, suchh as a
years woorth of pizzaa, flat-screenn TV, cash annd more.
Schwan
The Schw
wan Food Company
C
is a multibillioon-dollar privvate companny with a gllobal outlookk and
what it reefers to as aa solid preseence in roughhly 50 counttries. The company
c
is active
a
in muultiple
areas of the
t food ind
dustry includding retail, fooodservice, and
a home deelivery. Schw
wan is one of
o the
nations leading supp
pliers of frozzen pizzas too schools, thhrough its Global
G
Food Service unitt, and
the comppany also run
ns the Tonys chain of pizzerias. Wee estimate thhat Schwan registered salles of
approxim
mately $2.8 billion
b
in 20111.
Schwan markets
m
a nu
and Red Baronhav
ve significannt sales, acccording to SyymphonyIRII. Specificallly, Red Barron is
the dominant brand at
a $345 milliion, comprissing almost 60%
6
of Schw
wans frozenn pizza sales. Red
Barons sales
s
decreassed by $8% during the 52
5 weeks endding July 8, 2012.
Freschettta, Schwanss next biggeest pizza braand, has fareed poorly, deespite growtth in the reccently
introduceed Simply Inspired linee. During the 52 weeks ending Julyy 8, 2012, sales
s
fell 166% to
$156 milllion.
Last of Schwans
S
big three pizzza brands in
i terms of annual salees, Tony, has also beenn the
hardest hit.
h Sales of the
t plebian brand
b
with a cartoon Itallian chef maascot on its packages
p
droopped
24%, sugggesting thatt its relativelly low price point carriess recession-eera appeal.
e
2
crowded frozen pizzaa case. Frescchetta has also taken a neew marketinng approach via its Fresccehtta
B The Slicee introductioons. Says Mary
M
Brown, Schwans senior
s
Simply Innspired and Frescehtta By
director of
o marketing
g, The Simpply Inspired pizza offer large-cut
l
veggetables, sauuces and meaats to
create neew varieties unseen
u
in thiis category.
General Mills
M
Totin
nos introducced Pizza Sttuffers, a lesss mess, on-tthe-go pizzaa in 2011, with
w it
aimed diirectly at moms
m
who wanted,
w
acccording to a survey, snnack foods with less mess.
m
(Business Wire, Aug
gust 2011). The
T Stuffers are designedd to keep thee filing inside.
Septemberr 2012
100
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R

N
Product An
nalysis
GeneralMills
Perhaps best
M is one of
o the
worlds leading
l
food
c
i the
United States
S
y
p
organic products
p
P
Pizzza Minis
ntroduced Pizzza Stuffers,, a less messs, on-the-go pizza in 2011, with it aimed
a
Its Totinoos brand in
directly at
a moms who
o wanted, acccording to a survey, snaack foods wiith less messs. (Business Wire,
August 2011).
2
The Stuffers are designed
d
to keep
k
the filinng inside.
Frozenp
pizzalongttermtrend::positive;sshorttermtrend:negative
During 2006-2012,
2
frozen
f
5 from 63%
% to 66%. More
M
r
times a month
m
rose 15%.
Howeverr, nearer-term
m trends suuggest declinning penetraation (down 1% during 2010-2012)) and
engagem
ment (1+ per month
m
use down
d
2%; 5+
+ per month use down 4%
%).
Table
e91:HHFro
ozenPizzaEEating&EatiingFrequency,20062012
2006
2008
8
2010
2012
06-12
200
% ch
hange
20
010-12
% change
c
HH eats
63%
64%
67%
%
66
6%
5
5%
-1%
Times HH ea
ats in 30 days
s
1+
55%
57%
60%
%
59
9%
7
7%
-2%
32%
19%
14%
34%
19%
15%
33%
%
17%
%
16%
%
33
3%
18
8%
15
5%
2%
2
-3
3%
9
9%
0%
6%
-6%
22%
14%
23%
14%
27%
%
15%
%
26
6%
16
6%
5%
15
2.9%
5.4%
2.9%
%
5.8%
%
3.4%
%
8.2%
%
3.0
0%
7.3
3%
--4%
7%
-12%
-11%
1 to 4
1 to 2
3 to 4
5+
5 to 7
8 to 9
10+
0%
10
6
6%
35
5%

ased on Spring 20
006, 2008, 2010, and 2012 Expe
erian Simmons 12
2-Month NCS
Septemberr 2012
101
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Product An
nalysis
Brandusagetrending
DiGiorno
ostrengthen
nsbrandleadership
30% during 2006-20
2
s
shows
s
posiition.
Table92::HHFrozenPizzaBrand
dPenetrationandEngaggement,200
062012
2
2006
2008
2010
2012
2006-12
2
% chang
ge
2010-1
12
% chan
nge
Frozen pizza
p
brand*
5
55%
56%
%
57%
55%
1%
-3%
DiGiorno
o
Tombstone
Jack's
Stouffer'ss
California
a Pizza Kitchen
n
Celeste
Ellio's
Freschettta
Jeno's
Red Baro
on
Tony's
Totino's
Weight Watcher's
W
2
21%
21%
%
25%
14%
1
4
4.3%
12%
%
4.0%
%
14%
4.4%
3.6%
3
2
2.4%
4
4.0%
2
2.6%
3.5%
%
3.7%
%
4.3%
%
2.6%
%
4.2%
5.6%
4.5%
3.1%
27%
12%
4.8%
3.8%
29%
-11%
11%
5%
6.5%
4.1%
3.1%
167%
1%
17%
6%
-13%
%
8%
-10%
%
17%
%
-8%
0%
5%
-20%
%
-3%
-17%
%
-5%
24%
%
-3%
Other bra
ands
4.6%
4
4
4.0%
1
11%
9
9.5%
8
8.1%
1
1.9%
6.2%
%
3.6%
%
11%
%
9.3%
%
8.6%
%
1.3%
%
6.8%
3.9%
12%
11%
11%
1.4%
7.1%
3.2%
12%
8.9%
10%
1.7%
57%
-20%
13%
-6%
28%
-11%
1
11%
12%
%
8.4%
8.2%
-28%
*Any of the listed pizza brands

b
or other brands
s, based on Sprin
ng 2006, 2008, 2010,
2
and 2012 Experian
E
Simmon
ns 12-Month NC
CS
Septemberr 2012
102
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N
Product An
nalysis
NestlU
USA,Inc.
Compan
nyOverview
w
Founded in 1866 as the
t Anglo-S
Swiss Condennsed Milk Co.,
C Nestl S.A.
S
of Veveey, Switzerlaand is
the worldds largest fo
ood conglom
merate, and the
t companyy also has soome pharmacceutical holddings.
Its globall sales annuaally exceed $100
$
billionn. In mid-20008, Nestls Chief Execuutive Paul Buulcke
signaled a new directtion for the company
c
byy announcingg to investorrs that the coompany sougght to
integrate the pharmacceutical andd food sides of
o the busineess. Our obj
bjective is to be recognizzed as
the leadeer in nutritio
on, health annd wellnesss, he said. Summarizinng the shift in direction, Mr.
Bulcke said
s
that Neestl would move from
m a commooditized, raw
w materials-based foodd and
beveragees company to
t an added value,
v
sciencce-inspired nutrition,
n
health and welllness compaany.
In the Unnited States, Nestl has several
s
subsiidiaries: Nesstl Professioonal, Nestl Nutrition, Nestl
N
Waters North
N
Amerrica, Nestl Purina PetC
Care Compaany, and off course Nesstl USA, which
w
houses itts frozen con
nvenience food
fo productts. Nestl haas long beenn a powerhouse in the multim
serve andd single-serv
ve dinners/entrees categgories, wheree its Stouffeers and Leann Cuisine brrands
have booosted it to a number-onne spot. Itss also numbber one in the hand-heeld non-breaakfast
entrees category
c
viaa its Hot (& Lean) Pockkets and Stoouffers offeerings. The Hot Pocketss and
Lean Pockets brand
ds have alsoo given Nesstl a numbber-two spott in the hannd-held breaakfast
category.. And throug
gh its Stouffe
fers brand, thhe companyy also nailed down a num
mber-two possition
in the poot pies category, althouugh in both cases thosee number tw
wo spots arre far behindd the
category leadersSaara Lee and ConAgra,
C
reespectively.
Kraftacq
quisitionco
onsolidatesspizzasuprremacy
i January 2010
2
and connsummated in
i March, Nestl
N
acquired Krafts frrozen
In a deal negotiated in
pizza bussiness in a trransaction vaalued at $3.77 billion. Nuumber one inn the frozen pizza categoory at
the time,, Kraft bran
nds acquiredd by Nestl include DiG
Giorno, Tom
mbstone, annd Jacks as well
Californiia Pizza Kitcchen (which is marketedd under license from the popular
p
pizzza chain). Allso as
part of thhe deal, Nesttl acquired the Delissioo brand in Caanada, and tw
wo Wisconsin manufactturing
facilities (Medford an
nd Little Chuute).
CEO Pauul Bulcke was
w bullish on
o the deal. He was quuoted in a coompany press release isssued
January 5, 2010 as saying: Thhis frozen pizza business greatly ennhances Nestls frozen food
A
briinging togethher a selection of greatt U.S. and Canadian
C
brrands,
activitiess in North America,
industry--leading R&
&D, and exxcellent rouute-to-market capabilitiees, which complement
c
t our
existing ice cream direct-store-d
d
delivery. Wiith total salees of aroundd CHF 3 billlion, Nestl will
become the
t world leaader in the atttractive, fasst-growing frozen
fr
pizza category.
m
that the
t acquisitioon also boossted Nestl from
f
a positiion of suprem
macy
Mr. Bulccke didnt mention
in the froozen conveniience food market
m
to onee of outrightt dominance.. Virtually alll of Krafts sales
in the caategory camee from its piizza unit; evven those in other categoories such as
a hand-held nonbreakfastt entrees aree line extenssions of the pizza brandds. Combininng the Nestll/Kraft totalls for
the 52 weeeks ending July 11, 20110, sales are approximately $4 billioon, or equal to
t more thann onethird of the market (3
34%) in Sym
mphonyIRI-ttracked outleets, and almoost three tim
mes the level of its
Septemberr 2012
103
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Product An
nalysis
nearest competitor, ConAgra

C
($1.4 billion, 122%).
Kingofp
pizzasales
For the 52 weeks ending
e
July 8, 2012, Nestl
N
USA dominated the pizza category
c
witth its
DiGiornoo, Tombston
ne, South Beeach (since discontinuedd), Californiia Pizza Kittchen, and Jacks
Original brands, acqu
uired from Kraft
K
in Marrch 2010. When
W
added to
t its Stouffeers brand piizzas,
the acquuisition has catapulted Nestl
N
USA
A to the top of this cateegory, with $1.38 billioon in
salesa 45.4% sharre of SymphhonyIRI-tracked salesabout 26 pooints ahead of
o No. 2 Schhwan
Food ($5595 million and
a 19.5% shhare).
emiumtakin
ngabiggerh
hit
Superpre
Against the backdrrop of a 2.6%
2
declinne in frozeen pizza caategory salees, Nestl sales
opping 4.8%
% during thee 52 weeks ending Julyy 8, 2012. While
W
the deecline
underperrformed, dro
weights to its super--premium brands, only Nestls reggular DiGioorno brand outperforme
o
d the
market, with
w a 2.4%
% drop in saales. The reggular DiGiorrno brand continues to be most poopular
pizza braand, accoun
nting for 22..6% of the market and almost halff of Nestls overall market
m
share.
Superpreemium offering offeringgs found touugh going, with
w the Callifornia Pizzza Kitchen brand
b
sales dow
wn 15.5% an
nd the DiGioorno Ultimaate line extennsion sales down
d
29.3%
%. However, sales
of its Toombstone lin
ne also decliined 7.4%, while
w
its Jaccks and Stoouffers brannds declined only
0.4% andd 2.5%, respectively.
DiGiorno
oremainsjjewelinthe
epizzacrow
wn
While saales of Nestlls regular DiGiorno brand
b
droppeed 2.4%, thiis nevertheleess outperfoormed
both totaal Nestl fro
ozen pizza sales and thhe frozen pizza
p
categoory as a whhole. The reegular
DiGiornoo brand con
ntinues to bee the compaanys (and thhe countryss) most popuular pizza brand,
b
accountinng for almosst half of Nestls overalll market shaare.
Septemberr 2012
104
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Product An
nalysis
Table93:N
NestlFroze
enPizzaSale
es,byBrand
dandLineExxtension,20
0112012
Schwan
n frozen pizza sales
DiGiorno
DiGio
orno
DiGio
orno Harvest Wheat
W
DiGio
orno Ultimate
Tombsto
one
Tombstone
Tombstone Double
e Top
Tombstone Light
Stoufferr's
Stouffers
Stouffers Lean Cuiisine
Stouffers Lean Cuiisine Casual Cuisine
Stouffers Lean Cuiisine Casual Eating Classics
Stouffers Lean Cuiisine Simple Fa
avorites
Jacks
Sales ($mil))
Sales ($miil)
Sales
change
e
Share of
sales
s
$1,453.5
$1,383.6
100.0%
%
-4.8%
%
$728.6
$704.5
50.1%
-3.3%
%
$704.8
$0.0
$23.8
$687.7
$0.0
$16.8
48.5%
0.0%
1.6%
-2.4%
%
-80.3%
%
-29.3%
%
$247.0
$228.8
17.0%
-7.4%
%
$245.4
$0.0
$1.6
$221.8
$6.3
$0.6
16.9%
0.0%
0.1%
-9.6%
%
#DIV/0
0!
-62.9%
%
$181.2
$176.6
12.5%
-2.5%
%
$79.0
$0.0
$80.0
$10.8
$11.3
$77.0
$0.0
$82.6
$5.0
$11.9
5.4%
0.0%
5.5%
0.7%
0.8%
-2.5%
%
-27.7%
%
3.1%
%
-53.4%
%
5.8%
%
$147.3
$147.6
10.1%
0.2%
%
Jackks Half And Hallf

Jackks Naturally Ris
sing
Jackks Original
$3.6
$15.8
$127.9
$3.5
$16.6
$127.4
0.2%
1.1%
8.8%
-3.6%
%
5.2%
%
-0.4%
%
Californ
nia Pizza Kitch
hen
$149.3
$126.1
10.3%
-15.5%
%
$0.1
$0.1
0.0%
26.0%
%
Other

a from Symphonyy IRI Group (use
ed with permissio
on). Figures repre
esent sales for la
atest
52 weeks ending July 8, 2012.
Brandbybrand
Each pizzza brand has its own peersona. Tom
mbstone, witth innovativee flavors inccluding Mexxicanstyle topppings, targetts teens whoo favor new and extrem
me flavors. With
W over 12 flavor varrieties
and multtiple crust ty
ypes like Orriginal, Brickk Over Stylee and Garlicc Bread, it celebrated
c
itss 50th
anniversaary in 2012. Jacks is an
a old Midwestern brandd that has a rapid
r
followiing in that part of
the counttry. The licensed California Pizza Kitchen
K
labeel is a superppremium braand that offeers an
upscale restaurant
r
brrand name with
w exotic topping chooices. That would put it
i slightly upp the
luxury sccale from DiiGiorno, a premium
p
braand that throoughout its history
h
has directly
d
emuulated
the qualiity and varieety of deliveery pizza with
w its Self-Rising Crusst, Half & Half
H Toppedd, and
Cheese-S
Stuffed Crusst lines. As pizza
p
chain offerings haave become more sophiisticated, so have
DiGiornoos; the currrent line includes offerinngs such as Tuscan Styyle Chicken Crispy Flatbbread
Pizza andd stuffed Arttisan Bread.
Septemberr 2012
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Product An
nalysis
DiGiorno
oconsumerusagedrivers
Brand ussage is driven by 18-344s, black annd Asian coonsumers, addults with <$50K
<
houseehold
incomes,, householdss with childdren, and thhose living in the southheast and southwest
s
U
United
States.
quencyengaagementdriivenby183
34s,blacks,aand<$50Kh
households
Highfreq
Indexingg at 330, blacck consumerrs are more than 3 timees as likely to
t eat DiGioorno 5+ timees per
month. Inndexing at 188, <$25K HH
H income consumers
c
a almost tw
are
wice as likelyy to eat DiGiorno
5+ times per month.
Table94:DiGiorno
oFrozenPizzza:KeyUserrsandHighFrequencyU
Users
Eate
en DiGiorno in
n past 30 days
s
De
emographic
All
1+ tim
mes
5+ tim
mes
18
8-24
25
5-34
35
5-44
45
5-54
55
5-64
65
5+
12%
18%
18%
19%
16%
18%
108
8
119
9
98
100
0
95
84
171
1
142
2
77
7
104
4
62
2
63
3
White
Hispanic
Bla
ack
Assian
68%
15%
12%
4.6%
99
91
123
3
79
62
2
94
4
330
0
52
2
No
ortheast
So
outheast
Ce
entral
So
outhwest
Pa
acific
20%
21%
27%
12%
20%
77
122
2
106
6
106
6
88
77
7
147
7
113
3
128
8
40
0
<$
$25K
$2
25-$49K
$5
50-$74K
$7
75-$99K
$100-$149K
$150K+
20%
24%
19%
13%
13%
12%
98
102
2
97
102
2
103
3
100
0
188
8
145
5
60
0
60
0
48
8
28
8
No
one
1+
+
1
62%
38%
16%
92
113
3
114
4
61
165
5
143
3
2
3+
+
13%
9.2%
115
5
110
0
105
5
286
6
No
ote: white, black and
a Asian demographics are categorized as non--Hispanic.
So
n data from 2012 12-Month Experian Simmons Na
ational Consume
er Survey
No
ote: Green is use
ed to highlight figures that are at least 20% higherr than the averag
ge; red is used to
o highlight
figures that are at least 20% lower than the average
e.
Septemberr 2012
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Product An
nalysis
Newoffe
erings
mulate familly-style meaals, DiGiornno offers DiGiorno Pizzza & Sidess that
w
sides like
l
ntroduced Dipping
D
Stripps, 12-pull appart strips of
p
dipping sauces,
s
o the
pizza expperience.
Nestl iss also launcching three premium
p
pizza under its
i DiGiornoo Italian styyle line: meaatball
marinaraa, chicken paarmesan and meat trio.
Recessio
onaidsDiGio
ornosfightw
withpizzachains
Part of DiGiornos recent succcess, accordding to Tim
m Cofer, ass quoted in Snack Foood &
2
when Cofer was president
p
off Kraft Pizzaa), is that aa bad
Wholesalle Bakery (JJanuary 1, 2009,
economyy can be goo
od news forr the frozenn pizza businness. Because of these trying econnomic
times, Krraft has been
n steadily buuilding the quality
q
focus of its DiG
Giorno pizza line. Coferr also
said that he viewed the campaignn, Its Not Delivery,
D
Its DiGiorno which coompares the taste
of DiGioorno to that of carryout or delivery pizzaas a response to
t the recesssion. Howevver, it
would unndoubtedly be
b more accuurate to say that
t the receession just addds momentuum to an exiisting
strategy that
t
has alreeady been well
w documennted. For insstance, backk in May 20007, John Boswell
(then Sennior Vice President
P
andd General Manager,
M
Pizzza Categoryy, Kraft Fooods) told Frrozen
Food Agge: Today, were
w
goingg after an evven bigger sllice of the pizza
p
pieW
Were settingg our
sights onn the $20 billlion local pizzzeria busineess. By expaanding our frrame of referrence, weree now
playing in
i the entiree $35 billioon pizza maarket. We have taken thhe DiGiornoo brand intoo the
superprem
mium catego
ory with ourr new DiGiorrno Ultimatee pizza.
pizzachainsscrystalcleaar
Advertisiingmakestaargetingofp
p
In its advvertising, DiiGiorno coulld not be moore explicit about its plaans to wrest sales from pizza
chains. For
F instance,, in its Pizzza Guy TV
V spot, a pizzza chain dellivery man interrupts
i
a small
house paarty not to deliver pizzza, but to get a slice of
o DiGiorno. Promising not to conntinue
interruptiing the hosttesss partiess on a regullar basis, thhe delivery man
m explainnsThankss. We
dont delliver anythin
ng like this crrispy flatbreead.
py has a similar message,, with refereences to delivvery runningg throughoutt:
Print advvertising cop
A delivery bo
ox is no place for a crispy, delicious pizza.
D
DiGiorno
crisspy flatbreadd pizzaintrroducing thee taste that has never beeen delivered..
D
Deliciously
Ittalian-inspired toppings on a crispy flatbread
f
cruust.
Itts not deliveery. Its DiG
Giorno.
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Product An
nalysis
Thus, thrree out of th

he total of foour sentencess in the print ad (viewedd on the DiG
Giorno webssite in
September 2010) maake a reference to the supperiority of DiGiorno
D
ovver delivery pizza.
p
In additiion, DiGiorn
no introduceed Not Delivery Guyss a pair of gurus whho made it their
personal mission to share with pizza
p
loverss the beneffits of going with a fressh-baked pizzza at
home oveer the hasslees that come with deliverry and carry--out, (ibid, February 20012).
Goingafttersports
In Februuary 2012, DiGiorno
to Greatnesss promotionn during foootball
D
lauunched its Countdown
C
championnship season
n, where plaayers could enter a sweepstakes to win prizes, such as a years
y
worth off pizza, flat-sscreen TV, cash
c
and morre. Said Tom
m Moe, direcctor of markketing, DiGiorno
is the perrfect pick forr your big gaame party, (Marketing Weekly New
ws, February 2012).
And in December
D
20
011, DiGiornno became the
t new Off
fficial Pizza of the Chicaago Blackhaawks
and the Official
Pizzza of the Chhicago Bullss. United Center,

C
the sttadium wherre the teams play,
has a onee-of-a-kind pizzeria,
p
featturing DiGioorno Rising Crust
C
pizza and
a a full baar.
Tombsto
one
Tombstone Pizza saales dipped 9.6% duringg the 52 weeeks endingg July 8, 2012, accordinng to
SymphonnyIRI, falling to $221.8 million.
Tombsto
oneconsum
merusageffoundation
n
Brand ussage is driv
ven by 18-224s, black consumers,
c
a
adults
with <$25K houusehold incoomes,
househollds with children, and those living inn the central and southeaast United Sttates.
quencyengaagementunderscoresim
mportanceo
oflowerinco
omes&blacckconsumerrs
Highfreq
High-freqquency engaagement is even
e
more driven
d
by blaack consumeers, region, and the pressence
of childreen.
me, lower-in
ncome users are also morre importantt to the brandd: Indexing at 187, <$255 HH
By incom
income consumers
c
arre likely to eat
e Tombstoones 5+ tim
mes per montth. By age, in
i addition to 1824s, 35-554s also driv
ve high-frequuency use.
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Product An
nalysis
Table95:Tombstone
eFrozenPizzzaUseandH
HighFreque
encyUse:Ke
eyUsers
Dem
mographic
All
Used
d Tombstone in past 30 day
ys
1+ time
es
5+ tim
mes
18-24
25-34
35-4
44
45-54
55-64
65+
+
12%
18%
18%
19%
16%
18%
131
104
116
115
83
58
13
31
89
9
14
44
12
26
79
9
36
6
White
Hispanic
Black
Asia
an
68%
15%
12%
4.6%
104
61
149
57
84
4
69
9
22
28
77
7
Norrtheast
Sou
utheast
Cen
ntral
Sou
uthwest
Paccific
20%
21%
27%
12%
20%
52
121
153
83
65
31
1
14
41
19
98
37
7
33
3
<$2
25K
$25
5-$49K
$50
0-$74K
$75
5-$99K
$10
00-$149K
$15
50K+
20%
24%
19%
13%
13%
12%
118
98
98
88
107
84
18
87
114
88
8
40
0
74
4
42
2
Non
ne
1+
1
2
3+
62%
38%
16%
13%
9.2%
87
122
122
108
139
60
0
16
67
112
14
45
28
89
Note
e: The index represents indexed question agreem
ment against the all average (10
00). Each integerr above 100
corrresponds to a one-point increase in percentage likkelihood of agree
ement in comparrison to all averrage; each
integer below 100 co
orresponds to a one-point
o
decrea
ase in percentage likelihood of ag
greement in com
mparison to all
f
that are at
a least 20% high
her than the averrage; red is used to highlight
average. Green is used to highlight figures
east 20% lower th
han the average..
figures that are at le
Note
e: white, black and Asian demographics are categorized as non-H
Hispanic.
Sou
F
based on data
d
from 2012 12-Month
1
Winterr Experian Simmo
ons National Con
nsumer Survey
Septemberr 2012
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Product An
nalysis
Celebratiing its 50th anniversary

a
i 2012, Tom
in
mbstone Pizzza has launcched speciall commemorrative
packaginng in July.
Newoffferings
In 2011, Tombstonee re-introducced its Douuble Top pizzza featuring twice the toppings of
o the
Original.
StouffersandStoufffersLeanCuisine
Thanks to
t its Stoufffers and Stouffers Leean Cuisine brands, Neestl is the nations leaading
marketerr of frozen diinners and entrees. An offshoot
o
of a restaurant chain
c
begun in 1922, Stoouffer
Foods was
w founded in Clevelannd, OH, in 1954 and acqquired by Nestl
N
in 19773. With salles of
approxim
mately $2 biillion (includding Stouffeers Lean Cuuisine) in thhe 52 weekss ending Julyy 11,
2010, Sttouffers is Nestls larrgest single brand as well
w as the largest brannd in the frrozen
convenieence food maarket as a whhole. But Stoouffers didnnt fare welll during thosse 52 weeks,, with
sales dow
wn $203 milllion compared to the yeaar-ago periodd.
CaliforniaPizzaKitchen:suffe
eringfromn
neglectorttherecessio
on?
The Califfornia Pizza Kitchen braand had a weeak showing in the 52 weeeks ending July 8,
2012, droopping 15.5%
% to retail saales $126 miillion, accordding to Sym
mphonyIRI.
A numbeer of factors seem to be working
w
agaainst the brannd. Obviouslly, its difficcult to function as
a super-ppremium braand during a recession. But the corp
rporate situattion has beeen less than ideal
for Califfornia Pizzaa Kitchen. Aside
A
from the sale off the pizza unit, whichh is obviously a
distractioon, there app
pears to be a problem with
w internaal competitioon. After alll, DiGiorno
the
Kraft pizzza units mo
ost successfu
ful brandiss also positiooned as a premium/supeerpremium brand,
b
a similar enough con
ncept to cannnibalize saless from Califo
fornia Pizza Kitchen.
K
a
ass far as corpporate focuss, since the California Pizza
P
Also, DiiGiorno has a built-in advantage
Kitchen brand
b
is not wholly ownned, but ratheer the producct of a licenssing agreemeent.
The ownner of the California
C
Pizzza Kitchenn brand is a leading cassual dining chain
c
featurring a
diverse line
l
of pizzzas. It also serves a diverse
d
mennu of pastass, salads, apppetizers, soups,
sandwichhes and dessserts. The chain
c
owns 207 of its 253 restaurrants, and 46
4 operate under
u
franchisee or license agreementss. Their pizzzas are alsoo available at sports annd entertainnment
venues, such
s
as Ang
gel Stadium and
a the Stapples Center. However, on
o July 7, 20011, Golden Gate
Capital completed
c
th
he acquisitioon of CPK, and
a its now
w a private company.
c
Soo far, this haas not
breathed life back intto the CPK retail
r
pizza brand.
b
Septemberr 2012
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Product An
nalysis
JacksPiizzavirtuallyunchanged
During thhe 52 week
ks ending Juuly 8, 2012, Jacks Pizzza was virtuaally unchangged accordinng to
SymphonnyIRI, as salles dropped only
o
0.4% too $127 millioon.
Usagepaatternschan
ngesignificantlyaccordiingtofreque
encyofuse
As shownn below, Jaccks brand ussage changes significanttly with increeased monthhly usage.
Generalengagementdrivenby1834s,householdswithkids,midd
dleincomeb
bracket&re
egion
18-34s, households
h
with
w childrenn, adults with $75K-$999K househoold incomes, and those living
l
in the cenntral United States are most
m apt to eat Jacks pizzza at least once
o
a monthh. Those liviing in
the central U.S. index
x at 336, maaking them more
m
than thhree times moore likely thhan the averaage to
eat Jacks at least oncce a month.
Highfreq
quencyengaagementdisspersedacro
ossmanygro
oups
Among high-frequen
h
ncy users, the
t central U.S.
U
and hoouseholds with
w
childrenn are also major
m
drivers. By
B age, in addition
a
to 18-34s,
1
45-554s also drivve high-freqquency use. While blackk and
Asian coonsumers do not over-inndex for geneeral engagem
ment, they are
a more aptt to eat Jackks 5+
times perr month. Hig
gh-frequencyy use also skkews to userss with <$50K
K householdd incomes.
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Product An
nalysis
Table9
96:JacksFrrozenPizzaU
UseandHighFrequencyyUse:KeyU
Users
Dem
mographic
All
Us
sed Jacks in past 30 days
1+ time
es
5+ tim
mes
18-2
24
25-3
34
35-4
44
45-5
54
55-6
64
65+
12%
18%
18%
19%
16%
18%
141
135
114
107
69
43
13
30
14
46
10
08
14
48
43
3
25
5
White
Hisp
panic
Blacck
Asia
an
68%
15%
12%
4
4.6%
118
41
63
105
95
5
42
2
16
63
16
69
Norttheast
Southeast
Cen
ntral
Southwest
Paccific
20%
2
2
21%
2
27%
12%
2
20%
9
16
336
17
12
14
4
53
3
315
5
3
<$25K
$25--$49K
$50--$74K
$75--$99K
$100-$149K
$150K+
20%
2
2
24%
19%
13%
13%
12%
89
92
94
123
115
101
13
34
14
43
65
5
93
3
71
52
2
Non
ne
1+
1
2
3+
62%
38%
16%
13%
9
9.2%
78
136
112
136
178
71
14
48
41
13
32
35
54
Note
e: The index reprresents indexed question
q
agreem
ment against the all
average (100). Each integer above 100

corre
esponds to a one
e-point increase in percentage likkelihood of agree
ement in compariison to all avera
age; each
integ
ger below 100 co
orresponds to a one-point
o
decrease in percentage
e likelihood of agreement in comp
parison to all
averrage. Green is us
sed to highlight figures that are att least 20% highe
er than the avera
age; red is used to highlight
figurres that are at lea
ast 20% lower than the average.
Note
e: white, black an
nd Asian demogrraphics are categ
gorized as non-H
Hispanic.
Sourrce: Packaged Facts, based on data
d
from 2012 12-Month Winter Experian Simmo
ons National Con
nsumer Survey
P
has a relatively low
l
marketiing profile, lacking eveen its own Facebook page.
p
Jacks Pizza
Howeverr Jacks doees have its fans in its regional Midwest basee. And indeeed, some foormer
Midwesterners who are unable to find Jacks in theiir area are passionate about the pizza.
p
Accordinngly, Jacks fans have put
p up their own Jacks Facebook page,
p
whichh has about 1,300
1
memberss. The pagee reflects a genuine fondness
fo
andd enthusiasm
m for Jackks among many
m
Midwesterners, as weell as somethhing borderiing on despeeration from expatriates of
o that region.
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Product An
nalysis
TheSch
hwanFood
dCompanyy
Based inn Marshall, MN,
M The Scchwan Foodd Company is
i a multibilllion-dollar private com
mpany
with a global
g
outloo
ok and whaat it refers to as a soolid presence in roughlly 50 countrries.
Approxim
mately 17,00
00 employees worldwidde work forr Schwan, annd the comppany is active in
multiple areas of thee food indusstry includinng retail, fooodservice, annd home dellivery. Schw
wan is
one of thhe nations leeading supplliers of frozeen pizzas to schools, throough its Gloobal Food Seervice
unit, andd the compaany also ruuns the Tonnys chain of
o pizzerias. We estim
mate that Schhwan
registeredd sales of ap
pproximatelyy $2.8 billionn in 2011.
Schwans Home Serrvice unit
which accoording to thee company is
i the largesst direct-to-hhome
food deliivery servicee in the U.S.operates a fleet of vaans that hom
me-deliver frrozen produccts in
the 48 staates of the continental U.S.
U The com
mpanys hom
me-delivery business
b
hass nearly 500 sales
and distrribution centters in the U.S.
U and offeers more thann 350 produucts, which can
c be purchhased
from Scchwans Ho
ome Service website, www.schw
wans.com, or
o by phonne from 1--888SCHWA
ANS. In add
dition to deelivery, the colorful Scchwans truccks also haave an impoortant
marketinng function as
a they serve as mobile billboard
b
advvertisements..
Schwans Consumer Brands North
N
Amerrica divisionn is Based inn Bloomingtton, MN (paart of
the Twinn Cities areaa) and employs more than
t
2,600 people.
p
Acttive since 19970 as the retail
grocery business
b
uniit of The Scchwan Food Company, its
i frozen foood productss are availabble in
over 50,0000 retail ou
utlets across the United States.
S
It recently acquirred Mrs. Smiiths and Edw
wards
(primarilly known as dessert brannds), and the company manufactures
m
s and marketts a wide rannge of
frozen fooods, includiing Red Barron, Freschettta, and Tonnys frozen pizza;
p
Red Baron
B
and Toonys
hand-held entrees; Mrs.
M Smiths and Edwardds desserts, Pagoda
P
Exprress and Bonn Apptit enttrees,
and Larryys potatoes.
Pizzace
entricity
In the froozen food maarket, Schwaan is active in
i a number of categoriees, includingg appetizers/ssnack
rolls, hannd-held non-breakfast entrees, and breakfast enntrees. But pizza
p
is its bread
b
and butter,
accountinng for more than 95% of
o sales in thhe 52-week period
p
endinng July 8, 20012, accordiing to
SymphonnyIRI.
m
a nu
Schwan markets
and Red Baronhav
ve significannt sales, acccording to SyymphonyIRII. Specificallly, Red Barron is
the dominant brand at
a $345 milliion, comprissing almost 60%
6
of Schw
wans frozenn pizza sales. Red
Barons sales
s
decreassed by $8% during the 52
5 weeks endding July 8, 2012.
Freschettta, Schwanss next biggeest pizza braand, has fareed poorly, deespite growtth in the reccently
introduceed Simply Inspired linee. During the 52 weeks ending Julyy 8, 2012, sales
s
fell 166% to
$156 milllion.
Last of Schwans
S
big three pizzza brands in
i terms of annual salees, Tony, has also beenn the
hardest hit.
h Sales of the
t plebian brand
b
with a cartoon Itallian chef maascot on its packages
p
droopped
24%, sugggesting thatt its relativelly low price point carriess recession-eera appeal.
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Product An
nalysis
Table97:SSchwanFrozzenPizzaSalles,byBrand
dandLineEExtension,20
0112012
Schwan
n frozen pizza sales
Red Barron
Red Baron
Red Baron Singles
Red Baron Stone Hearth
H
Red Baron Pizzeria
a Style
Red Baron Super Singles
S
Red Baron Fire Bak
ked
Red Baron The Big
g Baron
Fresche
etta
Freschetta (Naturally Rising)
Freschetta Simply Inspired
Freschetta PizzAmore
Freschetta Brick Ov
ven
Tony's
Tonyys
Tonyys Personal Pizza
Tonyys Pizza For One
O
Tonyys Little Charlie
es
Other
Sales ($mil))
$685.3
Sales ($miil)
$594.7
Sales
change
e
-13%
Share of
sales
s
$376.0
$344.6
-8.4%
57.9%
%
$280.6
$45.7
$25.4
$14.3
$8.3
$1.5
$0.0
$268.1
$37.1
$18.7
$12.2
$7.3
$1.0
$0.3
45.1%
%
6.2%
%
3.1%
%
2.1%
%
1.2%
%
0.2%
%
0.1%
%
$186.1
$156.2
-4.5%
-18.8%
-26.4%
-14.7%
-12.0%
-33.3%
-16.1%
%
$151.5
$15.7
$18.9
$0.0
$115.7
$35.0
$4.2
$1.3
19.5%
%
5.9%
%
0.7%
%
0.2%
%
$123.2
$93.9
-23.6%
122.9%
%
-77.8%
-23.8%
%
$119.8
$0.0
$2.9
$0.4
$87.7
$4.7
$1.4
$0.1
14.7%
%
0.8%
%
0.2%
%
0.0%
%
$0.1
$0.0
-26.8%
#DIV/0!!
-51.7%
-75.0%
-
26.3%
%
15.8%
%

a from Symphonyy IRI Group (use
ed with permissio
on). Figures repre
esent sales for la
atest
52 weeks ending July 8, 2012.
RedBaron
i that each Red Baron Pan Pizza is packaged in a speciall seasoned, oveno
Red Baroons claim is
ready bakking pan thaat produces a thick crustt on the outsside and lighht and airy on the inside. Red
Baron weent on the offfensive agaainst pizza deelivery chainns with an advertising
a
campaign viaa web
videos. The
T company
y teamed up with comeddian Howie Mandel
M
for a series of six unscriptedd web
videos too expose the hidden costss of deliveryy pizza whilee accenting the
t ways in which
w
Red Baron
B
is the R
Real Deal, (P
PR Newswirre, May 2011). The spotts feature reaal, un-castedd delivery drrivers
droppingg off pizzas. Mandel theen pit the deelivery brandd against Reed Baron froozen pizzas. Said
Dan Ham
mmer, markeeting executtive for Schw
wans Consuumer Brandss, Pizza dellivery comppanies
are deceiiving consum
mers with notions
n
of innexpensive pizza,
p
but making
m
them
m pay extra when
w
they appear at the do
oor for tip, delivery
d
chaarge and whaatever else they
t
can com
me up with. The
series rann from May 2011 to Junee 2011.
As part of Red Baaron Heroes Beyond thhe Battlefield program, the compaany honoredd two
with Woundded Warrior Project. Saiid Craig Wannous,
servicem
men identified
d through a relationship
r
director of marketin
ng for Red Baron, Thhese heroes exemplify the
t spirit off the Red Baron
B
brandw
were comm
mitted to helpping the Wounded Warrrior Projectt improve thhe lives of those
Septemberr 2012
114
Pizza at Foo
R

N
Product An
nalysis
who servve, (PR New

wswire, Apriil 2012). The program was
w launchedd in conjuncction with itss new
line, Barrons Best, offered
o
in tw
wo crust styyles, Hand Tossed
T
and Pan.
P
All varrieties are toopped
with 100% real cheesse. Topping varieties incclude 4-Cheeese, Pepperooni, 4-Meat and
a Supremee.
The 2011 Red Baron Pizza & Sides

S
launchh was in ressponse to coonsumers demand
d
for more
Classic Crrust pizza vaarieties packkaged
value. Thhe product laaunched inittially with a Red Baron
with eithher mozzareella sticks or
o boneless Buffalo Wyyngz. The Red
R Baron brand team
m also
launchedd the Double Deal valuue pack in which
w
two pizzzas were paackaged in onne box.
Freschettta
e
2
crowded frozen pizzza case. Insteead of the trraditional boox, Schwan used a therm
moformed plastic
o
made it
i different, but
b also more consumerr and eco-friiendly, and more
package, which not only
t
p
packaging.
T productt also addreesses a conssumer desirre for
The
cost-effective than traditional
a better taasting frozenn pizza throuugh the usee of the Fressch-Taste Seeal package.. The
fresher and
easy to open
o
top is said to locck in our vibbrant flavorss without thhe need for additional shrink
wrap insiide the package.
The Fresschetta frozeen pizza packkaging was also designeed to use 300% less packkaging by weight
w
than a traaditional pizzza carton. The
T companny claims thee thermoform
med plastic package is more
earth-frieendly, and more
m
cost-efffective thann traditional packaging. The packagge eliminatees the
traditionaal cardboard
d box, savingg 1,378 tons of paperboaard or over 23,000
2
treess a year. Thee new
package also weighss less and taakes up less space than boxes,
b
meanning more can be packeed for
distributiion and feweer trucks neeeded to carryy the same am
mount of prooduct.
d has taken a new approoach in markketing its froozen offeringgs by introduucing

The Fresschetta brand
Freschettta SimplyInspired andd Freschetta By The Slicce. Says Maary Brown, senior
s
directtor of
marketinng, The Sim
mply Inspireed pizza offfer large-cut vegetables,, sauces andd meats to create
c
new variieties unseen
n in this caategory. Thhey include six varietiees: Hawaiiann Style, Farrmers
Market Veggie, Haarvest Suprreme, Southhern BBQ, Rustic Peppperoni Pom
modoro, Cllassic
Bruschettta and Tuscaan Farmhousse, accordinng to a comppany press reelease.
Throughoout the yearr, Freschetta Simply Inspired pizzza became Schwans
S
Coonsumer Braands
best-perfforming new
w product lauunch, and it was also reecognized thhroughout thhe industry for
f its
innovatioon and qualitty.
As for thhe Frescehttaa By The Sllice, it provvides the peerfect solutioon when seeeking one peerfect
slice of pizza
p
in min
nutes. In 20011, the brannd held a frree-pizza givveaway in August
A
that drove
d
nearly 1550,000 consu
umers to a promotional
p
l website andd gave awayy 30,000 slices of Frescchetta
By the Sllice pizza.
Septemberr 2012
115
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R

N
Product An
nalysis
Promotio
ons
Pizza Byy The Slice also offers new packagging; the varrieties are wrapped
w
in new
n
Fresch-T
Taste
Seal packaging to lo
ock in flavoor while usiing 30% lesss packagingg, thus savinng 1,378 tonns of
paperboaard, which ad
dds up to over 23,000 treees.
Freschettta took part in
i the Proudd To Supportt Pink fundraaising prograam, in whichh from Octoober 1
to Octobber 31, 2011
1, the comppany gave a $1 donatioon (up to $550,000) to Memorial
M
S
SloanKetteringg Cancer Cen
nter for eachh purchase of specially marked
m
boxees of Frescheetta pizza.
hetta announnced the intrroduction off seat salt andd olive oil too the sauce of
o the
Most recently, Fresch
brands Brick
B
Oven pizza,
p
(PR Newswire,
N
Feebruary 20122). This is part
p of its Raally for RealP
Pizza
Campaiggn to get consumers to Boycott Blah
B
and F
Fight for Frresch Flavorr. The Rallly for
RealPizzza campaign utilized Facebook, Twittter and blogggers.
Tonys
More thaan a decade ago, the coompany annnounced a neew breakthrough in better-for-you pizza
when it launched Tonys
T
SmarrtPizza prodducts for maainline schoool lunches. The SmartP
Pizza
products set the nutrritional bencchmark for the
t category by using prrotein in cruusts to enablle the
reductionn of total fat and sodium
m and continuue to meet chhild nutritionn requiremennts.
LiveSmarrtSchools
w
The trendd to deliver products wiith more ballanced nutrittion continuued in the faall of 2011, when
the comppany announ
nced a 50% expansion in its alreaddy extensivee product linne, including the
introducttion of the LiveSmart
L
Scchools brandd. The LiveS
Smart Schoools product portfolio
p
is a line
of more than
t
50 offerrings that meeet the Healtthier U.S. Scchool Challeenge guidelinnes.
ma
VillaPrim
vice also lauunched a neew brand with
w
Villa Prrima pizza. This brandd was
In 2011, Food Serv
pizza
introduceed specificallly for its Scrratch Readyy pizza produucts, offeringg a 16-inch pre-proofed
p
that incluudes a rolled
d-edge crust, pizzeria sauuce and mozzarella cheese. The pizzza comes parrtially
topped, allowing cu
ustomers to use whateever additional toppinggs they wannt on the pizza,
p
includingg locally sou
urced ingrediients.
Septemberr 2012
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N
Product An
nalysis
GeneralMills
Perhaps best
M is one of
o the
worlds leading
l
food
c
i the
United States
S
y
p
organic products
p
P
Pizzza Minis
In fiscal (May) 201
12, total U.S
S. sales, inccluding U.S
S. Retail, Innternational and Bakeries &
Foodservvice) were $12.46 billionn in 2012, up
u 3.9% from
m $11.99 biillion in 2011. U.S. net retail
sales reacched $10.48 billion in 20012, up 3.1%
% from $10.116 billion inn 2011.
Totinoss
Ontheggoinnovatio
on
General Mills
M
Totin
nos introducced Pizza Sttuffers, a lesss mess, on-tthe-go pizzaa in 2011, with
w it
aimed diirectly at moms
m
who wanted,
w
acccording to a survey, snnack foods with less mess.
m
(Businesss Wire, Augu
ust 2011). The
T Stuffers are
a designedd to keep the filing insidee.
onalactivityy
Promotio
2
Totino
os launchedd an exclusiive promotioon with Krooger Family of Stores, which
w
Also in 2011,
allows coonsumers to
o use their Totinos
T
pizzza boxes to play a realitty video gam
me starring Clint
Boyer. The
T game waas displayed on specificaally marked boxes sold at
a Krogers. The box alloowed
consumers to activatte the Get Behind
B
the Wheel
W
video game via their
t
compuuter webcam
m, (PR
Newswire, February 2011).
Totinos launched L
Learn a Tonn When Schhool is Fun Sweepstakees, which aw
warded $1000,000
our schools. Through itts Box Topss for Educattion program
m, Totinos gave
($25,0000 each) to fo
away onee million Bo
onus Box Topps. Consumeers then visited a websitte to enter foor a chance too win
250,000 Bonus Box Tops, the equivalent
e
o $25,000 for
of
f the schoool of their choice,
c
(Bussiness
Wire, Auugust 2011).
Its most recent prom
motion offerss specially marked
m
40-ccount Pizza Rolls Snackk Package where
w
two entriies earn a freee 1-day redbbox DVD reental.
Septemberr 2012
117
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Restaurant Brand An
nalysis
Chapter10:PizzaR
RestaurantB
BrandAnalyssis
Introducction
This chappter analyzees seven leadding pizza reestaurant chaains: California Pizza Kiitchen, Dom
minos
Pizza, Little
L
Caesarrs Pizza, Paapa Johns, Papa Murpphys, and Pizza Hut. Analysis of the
followingg is included
d: menu, proomotion, techhnology, gueest traffic, annd other dem
mographic trrends;
customerr mobile pho
one engagem
ment, custom
m food segm
mentation enggagement, and
a selected sales
informatiion.
Californ
niaPizzaKitchen
Compan
nyoverview
w
Californiia Pizza Kitcchen, Inc., foounded in 19985, is a leaading casual dining chainn featuring a line
of hearthh-baked pizzzas, includinng the origiinal BBQ Chicken
C
Pizzza, and a brroad selectioon of
distinctivve pastas, salads,
s
appeetizers, soupps, sandwicches and deesserts. Of the chain's 265
restaurannts, 205 are company-ow
c
wned and 60 operate undder franchisee or license agreements.
a
CPK
premium
m pizzas are also availabble to sports and entertaiinment fans at three Souuthern Califfornia
venues: Dodger Staadium, Anggel Stadium of Anaheiim and STA
APLES Cennter. Caterinng is
availablee via its webssite. Also inncluded in the Company's portfolio of
o concepts is
i LA Food Show
S
Grill & Bar,
B which is located inn Manhattann Beach, Caalifornia. It has also sett up CPK ASAP
A
locationss, mainly in airports annd malls. Thhe Companyy also has a licensing arrangement
a
with
Nestl USA
U
to manu
ufacture andd distribute a line of Caalifornia Pizzza Kitchen premium frrozen
products..
On July 7, 2011, Go
olden Gate Capital
C
comppleted the accquisition off CPK and, as a result of
o the
panys comm
mon stock is no longer puublicly tradeed.
acquisitioon, the comp
Restauraantsnapshot
Menuovverview
CPKs reestaurants haave an open kitchen wheere customerrs can see thheir food being preparedd. The
menu is notably
n
transs-fat free andd offerings a range of heealthy optionns, includingg gluten-freee. The
menu shoowcases dish
hes such as the
t Original BBQ Chickken Pizza, Thhai Chicken Pizza, Kungg Pao
Spaghetti, as well as new additioons.
Californiia Pizza Kitcchen has beeen called a culinary earrly adopter of food trennds, as evideenced
by its Koorean BBQ Steak
S
Tacos, jumping on board the trend populaarized by thee Kogi BBQ food
truck (N
Nations Resttaurant New
ws, June 20122).
Septemberr 2012
118
Pizza at Foo
R
Restaurant Brand An
nalysis
With its use

u of smalll plates and its
i debut of a Small Craavings mennu in 2010, COO
C
Sue Coollyns
said the average ch
heck prices were up byy 20%, Saidd Darren Tristano
T
of Technomic,
T
Inc.,
Operatoors are able to offer sm
maller platees at premiuum prices, and many consumers order
multiple small platees, which can bring thhe average check up too a pretty consistent level
(Nationss Restaurantt News, Januuary 2011).
There is also a CPKids Menu dessigned for kiids 10 and unnder in an efffort to appeeal to familiees.
Brandsttrategy
Accordinng to its web
bsite, CPK does
d
not frannchise domeestically. The brand, how
wever, francchises
internatioonally to com
mpanies thatt own full-seervice restaurrant chains.
Marketing&brand
dactivity
CPK is not
n known for
f its adverrtising and promotion.
p
W
While
laypeoople would be
b more fam
miliar
with Litttle Caesars Pizza! Piizza! or Dominos
D
adds, there is no advertissing or sloggan a
laypersonn can recall. Instead, CP
PKs strategyy seems to be
b to expand its restaurannt base and make
m
it the onne-stop famiily-friendly location forr premium pizzas.
p
Its restaurants are
a bright, liively,
clean andd designed in
n a modern-aaesthetic.
Innovatiionandacttivity
CPKs innnovation co
omes in the form
f
of its menu
m
flavor profile. Thhe new wavee pizza choicces at
CPK mayy have the originators
o
baack in Italy turning
t
in thheir graves, but
b somethinng tells me that
t if
they werre still aroun
nd today to try
t them, a pleasant chaange of hearrt may possibly be in order
o
(akueats.com). With offerings inn both tradittional (tomaato/basil, cheeese, pepperroni) and moodern
(shrimp scampi
s
pizzaa, Greek pizzza), as welll as pizza altternatives suuch as Kungg Pao spagheetti, it
appeals to
t a broad co
onsumer basee.
Menuin
nnovation
Recent addditions incllude jumpingg on the glutten-free banddwagon, as well
w as vegeetarian optionns.
Healthierintroductio
ons
In April 2012, CPK introduced the Limitedd Chicken Carbonara Pizzza that feattures a thin crust
w
garlic crme fraicche sauce, rosemary,
r
g
grilled
whitee meat chiccken, applew
wood
topped with
smoked bacon,
b
onion
ns, parmesann, asiago, rom
mano and mozzarella chheese. It retaiils for $6.69.
L
Edittion Chipotlee Roasted Vegetable
V
Pizzza, a thin-crrust pizza toopped
It also unnveiled the Limited
Septemberr 2012
119
Pizza at Foo
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Restaurant Brand An
nalysis
with roassted red and

d yellow pepppers, poblanno peppers, roasted cornn, black beaans, chipotle lime
sauce, paarmesan, asiago, romanoo and mozzaarella cheesees. It, too, reetails for $6..69. (Snack Food
F
& Wholeesale Bakery, June 2012)).
NewdesssertStrawb
berryShortcaake
In May 2011, CPK launched a limited tim
me Strawberrry Shortcakke, a shortccake biscuit with
homemadde whipped cream and candied lem
mon zest, toppped with fresh
f
strawberries. Said Rick
Rosenfield, We waanted to intrroduce a special decadeent dessert to
t treat mom
ms to someething
sweet forr Mothers Day
D
(Food and
a Beveragge Close-Up,, May 2011)).
NaturalC
Chickenand
dGlutenFreeCrust
In June 2011,
2
CPK launched
l
tenn new itemss (see chart below) and announced it now onlyy uses
natural chicken and a wide varieety of naturaal meats in its recipes. Inn addition, gluten-free
g
c
crusts
are now an option with
w 29 of thhe brands orriginal pizzaas. The crust joins a listt of other gllutenfree item
ms the chain identified earlier includding soups, salad,
s
appetiizers and deesserts. Said Rick
Rosenfield and Larry
y Flax, co-ffounders of CPK, The introductionn of natural chicken, tuurkey,
pepperonni, salami, Ittalian sausagge and Canaadian baconn on our mennu is also something we
w are
very prouud of and haappy to have as a mainstaay in our kitcchens (Business Wire, June
J
2011).
whatdoesntwork
Cuttingw
Also in June
J
2011, CPK
C
cut seveen underperfforming item
ms. Gone are the Tuscan panzanella salad,
s
the Tusccan white beean minestrrone, a bufffalo chickenn pizza, a peepperoni suupremo thin--crust
pizza, Poortobello mushroom
m
raavioli, wild-ccaught mahhi mahi andd the turkeyy stack sanddwich
(Nationss Restaurantt News, Junee 2011).
Septemberr 2012
120
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Restaurant Brand An
nalysis
Table101:CaliforniaP
PizzaKitchen
nNewOfferings:XXX
Item
Mediterra
anean Focaccia
a
Crispy Ma
ac-n-Cheese
Big Bang Shrimp Appetiizer
Artichoke
e & Broccoli Soup
Caramelizzed Peace Salad
Roasted Vegetable
V
Sala
ad
Habanero
o Carnitas Pizz
za
Carnitas Tacos
T
Strawberrry Shortcake
Non-Fat Yogurt
Y
Smooth
hies
Pumpkin Cheesecake
Description
D
Herb cheese
c
focaccia
a served with Mediterranean
M
Olive Oil
O and Parmessan/Small Cravvings Menu
Mac-n--Cheese lightlyy fried with pan
nko, served on
creamyy cheese sauce/Small Cravin
ngs Menu
Lightlyy fried shrimp to
ossed in spicy sweet chili
sauce with scallions and
a toasted se
esame seeds
Blend of artichoke he
earts, broccoli, romano,
Chedd
dar and Parmessan
Field greens,
g
spinach
h, warm caramelized peachess,
dried cranberries,
c
red
d onion, toasted pecans and
gorgon
nzola tossed in white balsamic vinaigrette
Roastted artichoke hearts, asparagus, Japanese
eggpla
ant, red & yellow
w peppers, corrn and sun-drie
ed
tomato
oes, served wa
arm over Romaine lettuce,
tossed
d in homemade
e Dijon balsamic vinaigrette
and topped with fresh
h avocado
Slow-rroasted pulled pork,
p
red onion
ns, cilantro
pesto, Mozzarella and queso quesa
adilla cheese
picy habanero salsa
s
with sp
Slow-rroasted pork, homemade avocado salsa
verde, red onions, cilantro, romaine
e and shredded
d
Napa cabbage
c
serve
ed with tortilla chips
c
and
roasted
d tomato salsa
a
Fresh strawberries on a shortcake biscuit
b
with
homem
made whipped cream and can
ndied lemon
zest
Strawb
berry, strawberrry banana, ma
ango, mango
banana and peach
Seasonal favorite pumpkin cheeseccake with ginge
er
crumb praline crust served
s
with fressh whipped
cream and praline sa
auce
Price
e
Datte
introdu
uced
$2.50
0
June 2011
2
$3.75
5
June 2011
2
$8.50
0
$6/bow
wl
$4/cup
p
June 2011
2
June 2011
2
$11.75/ffull
$8/hallf
June 2011
2
$13.25/ffull
$9.50/half
2
June 2011
$13
June 2011
2
$11
June 2011
2
$6.50
0
June 2011
2
$4.75
5
June 2011
2
$6.29
9
Oct 20
011
Source: Pa
b
on data fro
om Datassential Menu Trends Direct
Promotiionalactivitty
Facebookfansgetathankyou
In May 2012,
2
CPK kicked off a promotion to give a sppecial thannk you to itts Facebookk fans
with a coomplimentarry Spinach Artichoke
A
Dip. From Maay 8-14, CPK
K Facebook Fans could claim
c
their freee appetizer by
b visiting the
t CPK Facebook pagee and printinng the offerr (Business Wire,
May 2012).
Giftcards
In Novem
mber 2011, CPK introdduced an elecctronic gift card option allowing giift givers to send
their holliday greetin
ngs instantanneously. Puurchasable thhrough its website
w
(cpkk.com) or CPKs
C
Facebookk page, eGifft Cards couuld be assignned any dolllar amount and
a deliveredd to a recipiients
email adddress or mob
bile phone.
Septemberr 2012
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Restaurant Brand An
nalysis
CPK alsoo offered itss Holiday Rewards

R
Carrd program. Guest who purchased $100 or moore in
CPK Gifft Cards, th
hrough Deceember 24, 2011, receivved a $20 Rewards Card.
C
Those who
like[d] CPKs Faccebook pagee received addditional proomotions thhroughout thhe holiday seeason
(Businesss Wire, Noveember 2011)).
Alabamaatornadore
elief
In late April
A
and earrly May of 2011,
2
CPK said
s
it would donate 1000% of all dine-in sales from
both of its
i Birmingh
ham-area loccations on May
M 9 and 100 to aid in relief
r
effortss from the sttorms
that ripped through Alabama, killing
k
248 people.
p
Saidd Esther Rosenfield, wiife of co-fouunder
Rick Rossenfield, Being born annd raised in Birmingham
m with stronng family tiees still theree, this
cause is very
v
close an
nd dear to my
m heart (Enntertainmentt & Travel, May
M 2011).
Technologyinnovaation
CPK is active
a
on Faccebook, Twiitter, Pinterest, YouTubee, Google + and has a doownloadablee app.
It is interresting to no
ote that CPK
K shares manny of its recippes online, and
a also has three cookbbooks
for sale. (All
(
proceed
ds from the cookbooks
c
suupport childdrens charitiies.)
CPK seem
ms to have not
n moved forward
f
as agggressively in technologgy area as otther pizza chhains.
In 2010, CPK was testing touch screen
s
menuus and a pay--at-the-table system.
CPKattrractsMobileProfessio
onals
o other pizzza chains, Mobile Professsionals are more
m
likely to
t visit CPK
K with
Unlike thhe majority of
an indexx of 159. Mo
obirati and Social Connnectors arennt far behinnd, indexing at 114 and 118,
respectivvely. For 1+ visits per month,
m
the reesults are neearly the sam
me, except thhe numbers skew
slightly higher.
h
Septemberr 2012
122
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Restaurant Brand An
nalysis
UsageFrequ
uencyMobileSegmentaationAnalysis
Grraph101:CaliforniaPizzzaKitchenU
Note: The index represents

s indexed questiion agreement against
a
the all average
a
(100). Each integer abovve 100 corresponds to a
i
in perce
entage likelihood
d of agreement in comparison to
o all average; each
e
integer belo
ow 100 corresponds to a
one-point increase
one-point decrease
d
in perc
centage likelihood
d of agreement in comparison to all average.
Source: Pa
b
on data fro
om the Experian Simmons Winter 2012 NCS
TheCaliforniaPizzaaKitchenC
Consumer
Californiia Pizza Kittchen offerss a sit-downn restaurantt experiencee, and with that experiience,
attracts a higher-inccome consum
mer, with a higher perrcentage of customers from the Paacific
region annd from Asiaan heritage.
Keyconsumergrou
ups
Generalanyuse
Women, 18-24s, Asians, those liiving in the Pacific,
P
and those makinng $150K+ are
a more likeely to
K. Compareed to Dominnos and Pizzza Hut, CP
PK definitelyy skews to a higher-inccome
visit CPK
consumer.
Engagedusers
e
userrs (those whho have eatenn CPK 1-5 times
t
in the past
p month) the numberrs flip
Among engaged
slightly: men are mo
ore engagedd. 18-24s, Assians, those living in thhe Pacific, and
a those eaarning
$150K+ are also morre likely to visit.
v
Septemberr 2012
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Restaurant Brand An
nalysis
Taable102:CaaliforniaPizzzaKitchenEEngagement:KeyUsers
All
Any us
se
Eaten 1+ times
E
s in
past 30 days
s
Male
Female
48%
52%
95
105
101
99
18-24
25-34
35-44
45-54
55-64
65+
12%
18%
18%
19%
16%
18%
162
124
124
83
76
49
152
96
126
81
90
72
White
Hispanic
Black
68%
15%
12%
90
82
107
97
91
53
Asian
4.6%
305
311
Northeast
Southeas
st
Central
Southwes
st
Pacific
20%
21%
27%
12%
20%
84
81
64
68
203
70
84
59
60
226
<$25K
$25-$49K
K
$50-$74K
K
$75-$99K
K
$100-$14
49K
$150K+
20%
24%
19%
13%
13%
12%
36
69
92
132
123
222
28
75
79
137
121
238
None
1
2
3+
62%
16%
13%
9%
94
110
107
104
94
110
113
120
Demogra
aphic
Note: The index representss indexed questio

on agreement ag
gainst the all avverage (100). Ea
ach
ove 100 correspo
onds to a one-po
oint increase in percentage
p
likelih
hood of agreeme
ent in
integer abo
compariso
on to all average
e; each integer below
b
100 corressponds to a one-p
point decrease in
n
percentage
e likelihood of ag
greement in comparison to all average. Green iss used to highligh
ht
figures tha
at are at least 20%
% higher than the average; red iss used to highligh
ht figures that are
e at
least 20% lower than the average.
a
Note: white
e, black and Asia
an demographicss are categorized
d as non-Hispaniic.
Source: Pa
b
on data fro
om 2012 12-Mon
nth Winter Experian Simmons
National Consumer
C
Surveyy
Septemberr 2012
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Restaurant Brand An
nalysis
2008201
ncyanalysis::
Unfortunnately, the peercentage off consumers using CPK and using itt at least 1+ times per month
m
has declined during 2008-2012,
2
f
falling
from 3.8% to 3.6% and from 2.3% to 2.1%, respectivvely.
Table103:CaliforrniaPizzaKiitchenGuesttTrafficTrends,20082012
Anyy use
P
Percent
of adultt population
P
Population
universe
1+ visits per montth
P
Percent
P
Population
universe
2
2008
2010
2012
3.8%
3
8.9
3.8%
8.8
3.6%
8.5
2.3%
2
5.4
2.2%
5.1
2.1%
5.0
Sou
F
based on data from 12-Mo
onth 2008, 2010, and 2012 Experrian Simmons NC
CS
CPKcusttomerattittudesaboutfood
Not surprrisingly, thee CPK consuumer is moree likely to bee interested in gourmet food,
f
food thhat is
presentedd as an art form, and natural/organ
n
nic foods: thhis is the restaurant expperience. Buut the
CPK customer is also
o more likelly to prefer fast
f food to home
h
cookinng and to enj
njoy eating frozen
fr
dinners, in
i a tip of th
he hat to convvenience.
Table10
04:CaliforniiaPizzaKitch
hen:Attitud
desaboutHe
ealth,DietaandFood
State
ement
I try to eat
e gourmet foo
od whenever I can
I prefer food that is pre
esented as an art form
When shopping for foo
od, I especiallyy look for organ
nic or natural fo
oods
Eating fast
f
food helps me stay in my budget
I often drink
d
alcoholic beverages at restaurants
r
I prefer fast food to ho
ome cooking
I like to try new drinks
I often eat
e store-made
e, pre-cooked meals
m
I enjoy eating
e
foreign foods
f
I often eat
e frozen dinners
Usually I am quick to try
t a new nutritional product
Sta
atement agree
ement (indexe
ed)
19
96
17
71
16
68
15
59
15
53
14
47
14
44
14
42
14
40
13
38
13
38
Note: The index represen

nts indexed quesstion agreement against the all average (100). Each
E
integer above 100
onds to a one-poiint increase in pe
ercentage likeliho
ood of agreemen
nt in comparison to all average; each integer below
correspo
100 corre
esponds to a one
e-point decrease
e in percentage liikelihood of agreement in comparison to all average.
Source: Packaged Facts, based on data from
f
12-Month 2008,
2
2010, and 2012 Experian Simmons
S
NCS
Septemberr 2012
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Restaurant Brand An
nalysis
Custome
ersegmenttationbyfo
oodlifestyle
e
TrueFoo
odies
True Fooodies are alm
most 50% moore likely thaan average to be CPK cuustomers, indexing at 1447 for
any use and
a 135 for monthly usee, suggestingg that CPK is
i deliveringg on its prom
mise of a cullinary
adventure. No other major
m
pizza chain drawss this degree of True Fooodies.
True Foodiess are passionnate about foood and speend a lot of time cookinng at home. They
T
prrefer to buy organic foood, want theiir ingredientss fresh and buy
b environm
mentally frieendly
prroducts. Tru
ue Foodies tend
t
to eat a variety of food, love to experimeent with diffferent
cuuisines and at
a the same time
t
have addopted a heaalthy eating lifestyle. Thhey have the most
cuulinary expeertise and havve a love rellationship with food.
etyonaBud
dgetisntfarrbehind
ButVarie
Variety on
o a Budget consumers also tend too visit CPK, indexing at 119 for anyy use and 1339 for
monthly visits.
G
Graph102:C
CaliforniaPiizzaKitchenUsageFreq
quencyFood
dSegmentattionAnalysiss

a
the all average
a
i
in perce
entage likelihood
o all average; each
e
integer belo
one-point increase
one-point decrease
d
in perc
centage likelihood
Source: Pa
b
on data fro
om the Experian Simmons 12-Mo
onth Winter 2012
2 NCS
Septemberr 2012
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nalysis
Domino
osPizza
Compan
nyoverview
w
As of Deecember 2011, carryoutt- and deliveery-only pizzza chain Doominos Pizzza, Inc. opeerated
4,907 stoores in the U.S.
U (4,513 franchise stoores and 3944 company-owned storees). Accordinng to
the comppany, it is th
he largest piizza deliveryy company in
i the Uniteed States bassed on conssumer
spendingg, with a 22.6
6% share of the U.S. pizzza delivery market.
m
Thee company opperates throuugh a
primarilyy franchised network of stores, locatted in all 500 states and in
i more thann 70 internattional
markets, as well as company-ow
c
wned stores, all of whichh are in the United Statees. The com
mpany
also mannufactures itts dough andd thin crust products, and
a processees vegetablees and distribbutes
food, equuipment and supplies to its stores.
Menuovverview
Domino'ss basic menu
u provides thhree choicess for pizza products:
p
pizzza type, pizza size and pizza
p
toppings.. Most storees carry two or three sizes of Traditional Hand-Tossed, Pann, Brooklyn Style
and Crunnchy Thin Crust
C
pizza. A typical store also offe
fers Domino's Americann Legends piizzas,
Domino'ss Oven Bak
ked Sandwicches, Domino's Bread Bowl
B
Pasta, boneless
b
chiicken and wings,
w
bread sticks, Cinna Stix,
S
Chocolate Lava Crunch
C
Cakes, Stuffed Cheesy
C
Breadd and Coca--Cola
soft drinkk products.
Domino'ss also occassionally offeers other prooducts on a promotional
p
l or a regionnal basis, such as
salads. The
T entire order
o
takingg and pizza production process is designed foor completioon in
approxim
mately 12-15
5 minutes.
Growthstrategy
Dominos has sough
ht to leveragge its brandd by continuuing to introoduce innovvative, consuumera Oven Baaked Sandw
wiches, Dom
mino's
tested annd profitablle new product varietiies (such as
Americann Legends pizzas
p
and BreadBowl
B
Pasta), com
mplementary side items (such as chheesy
bread, booneless chiccken and winngs, Cinna Stix and Chhocolate Lavva Crunch Cakes)
C
and value
v
promotioons as well as
a through marketing
m
affiiliations withh brands succh as Coca-C
Cola.
Dominos continues to prove its willingnesss to reach coonsumers thrrough new technologies, (via
a menu innnovation tied to
online orrdering and mobile appps), promotioons with paartnerships, and
taste andd health trend
ds (via artisaan pizzas andd gluten-freee crusts).
Septemberr 2012
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Restaurant Brand An
nalysis
Menuin
nnovation
Higherqualityprodu
uctstimedw
withwellexe
ecutedprom
motions
d
2008-22011.
Dominos aggressiveely revampedd its menu during
mino's Oven Baked Sanddwiches in 2008 not only drove trraffic

Itts introductiion of Dom
grrowth, but also
a expanded its lunch business.
b
Inn 2009, the company worked

w
to divversify its menu
m
and to provide vallue and prem
mium
prrice points. That year, the companny introduceed Domino'ss American Legends piizzas,
D
Domino's
BreeadBowl Paasta and Choocolate Lavaa Crunch Caakes, which further increeased
trraffic.
Productreformulatio
onpayshuggedividendss
But its most
m significaant menu inttroduction occurred
o
duriing Q4 20099, when, in an
a effort to better
b
compete on taste, Do
omino's launnched its refformulated core
c
pizza product.
p
As part
p of a Jannuary
2010 invvestor presen
ntation, the company
c
shaared compettitive intelliggence to suppport its deciision,
citing a Brand Keyss "Customerr Loyalty Enngagement Index
I
in which
w
Dominnos ranked high
overall but low on taste.
d significantt media atteention and, according to
t the comppany, resulteed in
The launnch received
positive increases
i
in traffic and sales
s
in its U.S.
U stores thrroughout 20010.
Balancinglowpricepromotionsswithhigherqualityinttroductions
During 2011,
2
the co
ompany prom
moted a Tw
wo for $5.999 offer (a large two-ttopping pizzza for
$5.99), which
w
contin
nued throughh Q3 2011, and which the companny reports haas contributted to
continuedd sales mom
mentum.
ArtisanP
Pizzapromissesquality;p
providesupssellingamm
munition
In Septem
mber 2011, Dominos
D
Piizza introducced an Artisan Pizza linee that includdes three varrieties
of pies: Spinach
S
& Feta,
F
Italian Sausage & Pepper Trio, and Tuscann Salami & Roasted Veeggie.
The com
mpanys Artissan pizza, inntended to continue
c
to enhance
e
the brands quaality image, gives
customerrs incentive to
t trade up from
f
Dominoos 2 for $5.99 promotioons.
The purppose was to
o shift awayy from popuular price-ceentric promootions to brroaden its apppeal
beyond the
t college and footballl crowd. E
Even though the Artisann Pizzas arennt cheaper on a
dollar baasis, I think this
t is a greaat bang for your buck in terms of thee pizza categgoryand thheres
a lot to be said forr innovation, said Briaan Bittner, restaurant
r
annalyst (Walll Street Jouurnal,
2
October 2011).
Septemberr 2012
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Restaurant Brand An
nalysis
DominosSmartSliceschoollun
nchprogram
mmeetsUSD
DAschoolnu
utritioncrite
eria
As reportted in Markeeting Weeklyy News, Dom

minos Smarrt Slice meetts the USDA
A school nutrrition
lunch staandards for calories,
c
fat and sodium.. The pizza is
i freshly baaked and dellivered to schhools
and featuures whole-g
grain crust, light
l
mozzarrella cheese,, reduced soddium sauce, reduced fatt, and
reduced sodium pep
pperoni. Thee number off school parrticipating inn the prograam has increeased
from 1,1000 schools in
n 2011 to moore than 3,0000 schools across
a
37 staates (April 20012).
Newme
enuintrodu
uctionanalyysis
Ontrend
dwithgluten
nfree
Followinng in the foo
otsteps of thhe gluten-freee trend, Doominos beccame the firrst national pizza
delivery chain to offfer gluten-free crust. Thhe brand connsulted with the Nationaal Foundatioon for
A
to
o ensure it met the standards of the foundattion. Said J.
J Patrick Doyle,
D
Celiac Awareness
Dominos pizza and
d CEO, Thee prevalencee of gluten sensitivity
s
h become a real issue with
has
significannt impact on
n consumer choice,
c
and we
w want to be
b a part of the
t solution,, (PR Newsswire,
May 2012). Dominos even creatted a video on
o YouTubee that allows customers to
t decide whhether
f their diet..
the crust is suitable for
Newpizzzas,breadsaandsidesmakingtheirw
wayontoth
hemenu
b
categoories: artisann pizza andd breads & sides. Dom
minos
New offferings falls into two broad
continuess to improvee quality percceptions witth its artisan pizzas, espeecially the usse of its topppings,
which incclude fresh spinach,
s
roassted red and banana pepppers, and paarmesan-asiaago cheese.
Table
e105:DomiinosNewO
Offerings:Pizzza
Item
Tuscan Salami
S
& Roasted Veggie
Artisan Pizza
Spinach & Feta Artisan Pizza
Italian Sa
ausage & Pepper Trio
Artisan Pizza
Large 3-T
Topping Pizza
Chicken & Bacon Carbo
onara
Artisan Pizza
Gluten Frree Pizza Crustt
Descripttion
S
Salami,
spinach
h and onions, roasted
r
red and
d banana
p
peppers,
all ove
er a garlic parm
mesan sauce on an
a
artisan-style
cru
ust
A
Alfredo
sauce, feta and parme
esan-asiago ch
heeses,
fresh baby spin
nach and onion toppings on an artisans
style
crust
P
Parmesan-asia
ago cheese and
d sliced Italian sausage
s
c
complemented
by a trio of roa
asted red, green and
b
banana
pepperrs, on an artisan-style crust
C
Choose
any pe
enne pasta, 2-to
opping small piizza or
o
oven
baked san
ndwich
B
Blend
of marina
ara and Alfredo
o sauce, grilled
d chicken
b
breast,
smoked
d bacon, cheese, diced tomato
oes, and
a dash of orega
ano on an artisan-style crust
N
New
Pizza Crusst that is gluten
n-free
P
Price
Datte
introdu
uced
$7.99
Sept 2011
2
$7.99
Sept 2011
2
$7.99
$7.99
Sept 2011
2
pt
Sep
2011/L
LTO
$7.99
-
Mar 2012
May 2012
2
Source: Pa
ackaged Facts
Septemberr 2012
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Restaurant Brand An
nalysis
Sidesand
dappsupth
heflavorantte
Breads contain
c
fresh
h spinach annd cheese, and
a its boneeless wings are made with
w 100% white
w
meat. Alll newly intro
oduced offerrings fall witthin a budgett-friendly prrice point of $5.99.
os ups the flavor ante. Its hot winngs dont juust come witth any hot sauce:
In doing so, Domino
me with man
ngo habanero, which coonveys sweeetness and exxtreme heat
and conveys a
they com
sauce com
mbination ex
xpectation thhat is a cut above
a
saucess introduced just a few yeears ago.
Table106
6:DominossNewOfferiings:Bread&
&Sides
Item
De
escription
Chicken wings, sauced with choice off hot, new swee
et
mango habanero
h
or BB
BQ
Wings
Boneless Wings
$5 Carryy Out Lunch De
eal
Stuffed Cheesy
C
Bread
with Spin
nach & Feta
Stuffed Cheesy
C
Bread
with Baccon & Jalapeno
o
Stuffed Cheesy
C
Bread
Parmesa
an Bread Bits
Lightly brreaded, made with 100% white breast meatt

a penne passta, 2-topping small
s
pizza or
Choose any
oven bakked sandwich
Oven baked breadstickks stuffed with cheese,
c
fresh
spinach and
a feta cheesse
Oven baked breadstickks stuffed with cheese,
c
smoke
ed
bacon & jalapeno pepp
pers
Oven baked breadstickks stuffed with cheese
c
and
heese
covered in a blend of ch
Oven baked bite-size breadsticks
b
lightly sprinkled
with parm
mesan-asiago cheese
c
and seasoned w/garliic
Price
$5.99//
8 piece
e
$5.99//
8 pieces
$5
$5.99//
8 pieces
$5.99//
8 pieces
$5.99//
8 pieces
$2.99//
16 piece
es
Date
e
Introduc
ced
Feb 20
011
011
Feb 20
Feb 20
011
/LTO
O
Nov 20
011
011
Nov 20
011
Nov 20
Nov 20
011
Source: Packaged
P
Facts
During thhe first two quarters off 2012, Dom
minos focuseed on promootions to im
mprove store level
profitabillity. The brrand experieenced slightt decreases in order coounts duringg this timefrrame,
domesticc same store sales increaased moderattely, thanks in large partt to pricing increases.
i
During
Q2, adveertising focussed on Artisan pizzas, while
w
in Q3, the
t focus shiifted to sanddwiches.
GlobalDominosDayypromotion
n
G
Dom
minos Day, a multi-naational prom
motion withh 19
In 2011, Dominoss hosted Global
participatting countriees on Facebbook, in ordeer to help ceelebrate the companys 51st anniverrsary.
The evennt offered 50%
5
off anyy pizza ordeered online through
t
a Facebook
F
tabb (PR Newsswire,
Decembeer 2011).
ShopRun
nnerpromottion
weepstakes that
t
awardedd free
In 2011, Dominos, in partnershhip with ShoopRunner, laaunched a sw
pizzas foor one year in
i the form of
o $1,100 inn Dominos gift
g cards. Consumers
C
w
were
able to enter
by signinng up for a 30-day free trrial of ShopR
Runner, a members-only
m
y shopping service
s
that offers
o
free shippping.) (PR Newswire,
N
Appril 2011).
Septemberr 2012
130
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Restaurant Brand An
nalysis
Carryouttpromotion
In 2011, Dominos also
a ran a caarryout prom
motion intendded to spur sales
s
during Monday thrrough
Wednesdday, which are its slow
west days off the week. The carryoout-only proomotion, a threet
topping pizza
p
for $7.99, was onlyy available Monday
M
throough Wednessday.
Accordinng to the company, carrryout comprrised about a third of itts business in
i 2011, up from
15% to 20%
2
in 2000.
CyberMonday
d that it hadd processed more than 1 million orders in the U.S.

U from online
o
Dominos announced
2 to Decem
mber 4, 2011, its best weeek of
and mobiile devices in one week alone, from November 28
U.S. digiital sales eveer. Since its launch, Dom
minos onlinne ordering now
n
makes up about 300% of
total ordeers. (PR New
wswire, Deceember 2011)).
With resppect to custo
omer orderinng, Dominos has been a technologyy leader for some
s
time, as
a the
companyy moved quiickly to harrness the potential of onnline orderinng and mobbile orderingg and
applicatioons, an ideall match for carryout
c
andd delivery resstaurant busiiness.
$1millioninweeklysale
es
iPhoneaapppasses$
As suggeested by the success of its iPhone appp, the comppany continuues to lead. The
T companyy has
reported that its iPho
one app geneerated more than $1 milllion in weekkly sales duuring Q3 20111, or
S. sales. Online orderingg (including iPhone ordeering) now generates
g
300% of
1.5% of its total U.S
sales.
DominoslaunchAndroidapp
l
a new
n Androidd smartphonne ordering app,
a
availablle in the Android
In 2012, Dominos launched
pp includes coupon seaarch, full nattional menuu, GPS storee locator and the
Marketpllace. The ap
ability too follow an order
o
with Doominos Traacker. (PR Newswire,
N
February 20122).
Q22012ontrackforrgrowth
By Q2 2012,
2
more than 30% of
o total salees had comee from digittal channelss. In April 2012,
2
ordering surpassed $1
$ billion in annual digittal sales in the
t U.S. At this point, both
b
mobile apps,
iPhone and
a Android,, had enteredd the top 10 lifestyle, annd food and drink rankinngs in the iT
Tunes
store andd on Google Play.
Septemberr 2012
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Restaurant Brand An
nalysis
Accordinng to the com

mpanys Q2 2012 investor conferennce call, mobbile orderingg apps have been
downloadded almost 3.5
3 million times.
t
Dominno's now offfers its mobiile ordering app to moree than
80% of thhe smartpho
ones in the U.S.
U
Custome
ersegmenttationbym
mobiledevicceinteractiion
Higher-fr
frequency Do
ominos userrs (6+ visits per month) are more thhan twice as likely as aveerage
to belongg to the Mob
birati group.
Astrongconnectiontohighlyen
ngagedmob
bilephoneu
users
Mobirati reprresent the mobile

M
m
generration. Theyy grew up with
w cell phhones and caannot
im
magine life without
w
them
m. Cell phonee devices aree a central part of their everyday
e
livees.
Dominos recceives a lot of

D
o traffic from
m Mobirati, highly engaaged mobile phone userss who
arre more likeely to eat Doominos thann other mobiile segmentaation groups.. This bodess well
foor the company becausee it means itt is connecting with mobbile-friendlyy consumerss who
arre probably gravitating to
t its digital ordering plaatform.
Graph103:Domin
nosUsageFFrequencyM
MobileSegm
mentationAn
nalysis
Source: Pa
b
on data fro
PULSEge
eneratingon
nlinesales
Domino'ss PULSE point-of-sale
p
e system is in every company-ow
c
wned U.S. store,
s
as weell as
substantiially all of itts domestic franchise sttores. Industtry data indiicates that Dominos
D
haas the
largest shhare of onlin
ne sales in thhe U.S. QSR
R pizza categgory. Additioonally, it is estimated
e
thaat the
Domino'ss Pizza systeem is one off the largest online retaillers in the U.S. in terms of the numbber of
transactioons. Since the rolloutt of Dominno's PULSE
E to domesstic stores, online orddering
transactioons have gro
own. Currenntly, on averrage, nearly 25% of dom
mestic storees' sales origginate
online. Domino's
D
PU
ULSE featurees include:
Septemberr 2012
132
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R
Restaurant Brand An
nalysis
Touch screen
T
n ordering, which
w
ensures accuracy and
a facilitatees more efficcient order taaking
D
Delivery
driv
ver routing syystem, whichh ensures deelivery efficiiency
A
Administrativ
ve and reporrting capabilities, which enable storee managers to
t better focuus on
sttore operatio
ons and custoomer satisfacction
State-of-the-aart online orddering capabbility, includding Pizza Trracker and Pizza
P
Builderr.
ment also beelieves that utilizing thhe PULSE system

s
provides compettitive advanntages
Managem
over otheer point-of-sales systemss, including:
Consistent ex
C
xecution and communicaation of operrational best practices
R
Real-time
disssemination of data wiith field maanagement, which
w
enables efficientt and
innformed decision makingg
D
Data
collectiion capabillity, which provides senior
s
manaagement innsight into store
opperations
Innnovation sh
haring througghout the syystem, whichh allows all users
u
to be more
m
efficiennt and
prrofitable
E
Electronic
diisseminationn of materials and infformation, which
w
reducces trainingg and
opperating cossts.
Callcenterbuildsinccrementalsaales
Dominos built a calll center into its ordering system, so that
t when a customer caalls the restauurant,
the call is routed to a call centerr to avoid a busy
b
signal. While onlyy a small perrcentage of stores
s
use the call
c center, (as
( of Decem
mber 2011), the companny reports thhat it has drriven increm
mental
sales in thhe stores usiing it.
TheDom
minosConssumer
Keyconsumergrou
ups
Generalanyuse
18-24s and
a black co
onsumers arre more likely to orderr Dominos in the anny use segm
ment.
Household income doesnt seem to play a maajor role in determining
d
use.
Engagedusers:youtthandnonw
whiteracial//ethnicgrou
upsdrivesalles
Among consumers
c
who
w order Dominos
D
beetween 1-5 times per month,
m
18-244s lead the way,
indexing at 152. Wh
hile black coonsumers inddex at 146, Hispanic
H
andd Asian consumers arennt far
behind, at
a 138 and 12
29, respectivvely.
Septemberr 2012
133
Pizza at Foo
R
Restaurant Brand An
nalysis
Highlyen
ngageduserrs:HHincom
mebecomesmuchmore
eimportant
For conssumers ordeering 6 + tiimes in the last monthh, 18-24s aggain lead thhe charge. Black
B
consumers are almosst twice as likely than Hispanics
H
to eat Dominoos 6 or morre times a month,
m
and almoost 5 times more
m
likely than
t
White consumers.
c
O
Only
among highly engaaged (6+ usees per
month) do
d we see th
he effect of household income,
i
as <$25K
<
HH income useers are more than
twice as likely to usee the brand.
Table107
7:DominossPizzaEngaggement:KeyyUsers
Demographic
c
Used Domino
os
In past
p
30 days
1-5 times
6+ times
All
An
ny use
18-24
12%
158
152
20
09*
25-34
35-44
18%
18%
130
122
127
129
17
73*
11
15*
45-54
55-64
65+
19%
16%
18%
96
69
42
98
69
39
58*
5
6
66
1
15
White
Hispanic
Black
Asian
68%
15%
12%
4
4.6%
84
129
149
125
82
138
147
129
52*
5
17
76
27
75*
14
43*
Northeast
Southeast
Central
Southwest
Pacific
20%
21%
27%
12%
20%
100
112
87
119
93
99
115
87
123
90
14
41
9
98*
5
58**
16
61*
8
81*
<$25K
$25-$49K
20%
24%
103
100
99
99
20
02
9
92*
$50-$74K
$75-$99K
$100-$149K
$150K+
19%
13%
13%
12%
99
94
104
98
100
101
104
99
80*
8
3
38**
8
85**
6
65**
None
1+
62%
38%
79
136
77
139
56
5
17
73
Note: The index

x represents inde
exed question agreement againstt the all average
e (100). Each intteger
above 100 corre
esponds to a one
ement in compariison to all
average; each in
nteger below 100
0 corresponds to
o a one-point deccrease in percenttage likelihood of
agreement in co
omparison to all average. Green
n is used to highllight figures that are at least 20%
% higher
than the average; red is used to highlight figuress that are at leastt 20% lower than
n the average.
Note: white, black and Asian demographics are categorized
c
as non-Hispanic.
n
Source: Packag
ged Facts, based
d on data from 20
012 12-Month Wiinter Experian Siimmons National
Consumer Survey
Septemberr 2012
134
Pizza at Foo
R
Restaurant Brand An
nalysis
200920
012Guesttrrafficfrequ
uencyanalyysis
Some 144.1% of consumers age 18+ use Doominos, acccording to thhe Experiann Simmons NCS,
N
down sligghtly during
g 2009-2011.. While 10.44% of adult consumers
c
u the brandd between 1 and
use
a 5
times perr month, abo
out 1% use itt at least 6 tim
mes per monnth.
p
among conssumers age 18-29, blackks, Hispanics and
By demoographic, usaage is most pronounced
consumers with child
dren. Higherr-frequency usage
u
trendss among eachh of these grroups are possitive
except foor Hispanics.
During 2009-2012,
2
Dominos
D
ussage has rem
mained relativvely stable, including anny use, usagge 1-5
times perr month, and
d usage 6+ times
t
per moonth. To caasual observeers, static guuest traffic trrends
may foreetell bad new
ws, but takenn in context with the hitt restaurants (and pizza restaurants) have
taken froom the econo
omy, just treaading water is good new
ws.
Table108::DominosG
GuestTrafficcTrends,20
0092012
Any use
Percent of adult population
p
Population univerrse
1 to 5 visits per month
p
6+ viisits per month
p
200
09
2010
0
2011
2012
14.4
4%
33.6
14.1%
%
33.2
14.3%
34.1
14.1%
33.8
10.6
6%
24.7
9.8%
%
23.2
10.8%
25.8
10.4%
24.9
0.8%
%
1.8
8
0.7%
%
1.7
0.9%
2.2
0.9%
2.2
acts, based on da
ata from 12-Montth 2008, 2010, and
a 2012 Experia
an Simmons NCS
S
Domino
osdeliverstoHispaniccs
Packagedd Facts Latino Foodseervice Trendds in the U.S.
U (Decembber 2011) included
i
dettailed
demograpphic geograp
phic analysees of leading brands.
As show
wn an excerp
pt below, ouur analysis of the Dom
minos brandd suggests thhat its popuularity
among Hispanics
H
is not closely associated with
w state poopulation treends (unlikee other Hisppaniccentric brands
b
such as Dennyss and Jack in
i the Box),, as little coorrelation exxists betweenn the
number of
o Dominoss in a state annd the percenntage of Hisspanics residding there.
While 78% of
W
o Hispanics reside in the states of New
N Mexicoo, Texas, Callifornia, Arizzona,
N
Nevada,
Florida, Coloraddo, New Jerssey, New Yoork and Illinnois, these sttates are hom
me to
onnly 40% off Dominos U.S.
U locations. Moreoveer, states suuch as Ohio,, North Caroolina,
V
Virginia
and Georgia haave a much higher propportional shaare of Dominos locatioons to
H
Hispanic
populations (not shown).
Septemberr 2012
135
Pizza at Foo
R
Restaurant Brand An
nalysis
Clearly, Dominos
D
cllearly draws Hispanics on
o non-geogrraphic meritts.
As discussed in our restaaurant segmeent analysis,, Hispanics are more likkely than aveerage
A
too visit limiited-service pizza resttaurants, whhich we beelieve is attributable
a
to a
coombination of price, cullture and cuiisine. But thee Dominos brand garneers a significcantly
higher share of
o Hispanic users than does
d
rival Pizzza Hut, which suggestss stronger aff
ffinity
am
mong Hispaanics for the Dominos brrand.
Tab
ble109:Dom
minosLocattion&HispaanicPopulattionAnalysis
Popula
ation
(mil)
His
spanic
pop
pulation
(mil)
Hispanic
share of
p
population
(%)
Dominos
locations
(#)
% U.S
S.
Domino
os
locatio
ons
(%)
Hisp
panics
per lo
ocation
New Mexico
Texas
California
Arizona
Nevada
Florida
Colorado
New Jersey
New York
Illinois
2.06
6
25.15
37.2
25
6.39
9
2.70
0
18.8
80
5.03
3
8.79
9
19.3
38
12.8
83
0.95
0
9
9.46
1
14.01
1.90
0
0.72
4
4.22
1.04
1.56
3
3.42
2
2.03
46.3%
37.6%
37.6%
29.6%
26.5%
22.5%
20.7%
17.7%
17.6%
15.8%
54
473
540
138
58
418
131
167
230
205
3.4%
%
30.1%
%
34.4%
%
8.8%
%
3.7%
%
26.6%
%
8.3%
%
10.6%
%
14.6%
%
13.0%
%
36
6,669
53
3,755
33
3,366
24
4,297
22
2,391
26
6,733
38
8,470
194
4,393
69
9,733
35
5,572
U.S.
308.7
75
5
50.48
16.3%
1,571
100%
%
32
2,131
State
Source: Compiled by Packaged

d Facts based on
n data from the 2010
2
U.S. Census and public doccuments.
Note: U.S. population figures arre for 50 states and
a District of Co
olumbia
But...
e
userrs is down, falling almoost 3% perceent from 2011 to
The geneeral trend off Hispanic engaged
2012 in the
t any use and 1-5 visits
v
per monnth categorry.
Table1010:DominosHispanicGuestTTrafficTrend
ds,2009201
12
Any use
6+ viisits per month
acts
200
09
2010
0
2011
2012
21.7
7%
17.2
2%
2.1%
%
20.6%
%
15.5%
%
1.8%
%
21.4%
17.2%
1.9%
18.1%
14.3%
1.6%
Septemberr 2012
136
Pizza at Foo
R
Restaurant Brand An
nalysis
Custome
ersegmenttationbyfo
oodlifestyle
e
Higher-fr
frequency Do
ominos users (6+ visitss per month)) are almost twice as likkely as averaage to
belong too the Variety
y on a Budgget group, suupporting Doominos conntention thatt it performss well
with imppulse-driven consumers.
mpulse driveen consumers with the ready meanns to order (via

(
mobile ordering apps or
Im
otther online capability) can betterr satisfy their impulsee, somethingg Dominoss has
agggressively addressed.
a
The Variety on a Budgeet segment iss very busy and frequenntly eats on the
T
t run. Theey see
frrozen food as
a a convennient alternaative to prepparing mealss with freshh ingredientss and
raarely plan ah
head for theiir meals. Thiis group exppresses intereest in gourm
met foodass long
ass it fits in th
heir budget. They have their own appreciation
a
n of the relattionship bettween
foood and good health.
h104:DominosUsageFrequencyFoodSegme
entationAnaalysis
Graph
Source: Pa
b
on data fro
Salespe
erformance
e
s
of its
i Q4 20099 product refformulation and subseqquent LTOs,, Dominos grew
On the strength
sales robustly in 2010
0 and 2011.
On an annuaal basis, sam

O
me-store salees increased a robust 100% during 2010,
2
after being
b
esssentially flaat during 20009. With suuch strong saame-store saales growth during 20100 and
2011, Domin
nos has made up andd then surpaassed sales losses incuurred duringg the
reecession.
Dominos domestic samee-store sales grew a heallthy 3% duriing Q3 20111, building on

D
o Q3
2010 same-sttore sales groowth of 11.77%.
Septemberr 2012
137
Pizza at Foo
R
Restaurant Brand An
nalysis
2012onsolidfootingg
For the first
f
two quaarters of 2012, same-stoore sales inccreased 1.9%
%. Q1 2012 same-store sales
increasedd 1.7%, whille Q2 2012 same-store
s
saales increaseed 4.8%.
Table1011:Domino
os,Selected
dMetrics,20
00711
2007
2008
2009
20
010
2011
Dome
estic company-owned stores
Dome
estic franchise
Total domestic store
es revenues
$394.6
6
$158.1
$552.6
6
$357.7
$153.9
$511.6
$335.8
$157.8
$493.6
$34
45.6
$17
73.3
$519.0
$336.3
3
$187.0
0
$523.4
4
Total U.S. units
5,155
5,047
4,927
4,9
929
4,907
Dome
estic system-wide same-store
e sales growth
-1.7%
-4.9%
0.5%
9.9%
3.5%
Fiscall year December
Source
e: Packaged Fac
cts; company doccuments
Septemberr 2012
138
Pizza at Foo
R
Restaurant Brand An
nalysis
LittleCaaesarsPizzza
Compan
nyoverview
w
Accordinng to Little Caesars, it is currenttly the larggest internattional carry--out chain, with
restaurannts on five co
ontinents. Thhe companyy's founders, Michael and Marian Iliitch, opened their
first restaaurant in Gaarden City, Michigan
M
in 1959. In 20010, the brannd added moore stores arround
the worldd than any other pizza chain. In adddition to pizza, core HOT-N-REA
H
ADY menu items
i
include Caesar
C
Wing
gs, Caesar Diips, salads, BBQ
B
Rib Sm
mackers and Cinnamon Bread.
B
Said Darrren Tristano
o, executive at Technom
mic, They reeally stand for
fo value more than any other
brand (A
Advertising Age, June 2012). A reecent Sandeelman & Asssociates suurvey rated Little
L
Caesars the
t best valu
ue for the mooney.
Menuovverview
u sticks to thhe basics: pizza,
p
and a variety of it: sausage,, hula Hawaaiian,
Little Caaesars menu
pepperonni, additionall toppings; as
a well as a few outliers such as BB
BQ Rib Smacckers, breads and
salads.
Brandsttrategy
We belieeve the brand
d seems to toout itself moore as a fasttest growingg franchise and never sppeaks
towards health,
h
fresh
hness or tastee.
Marketing&brand
dactivity
Little Caaesars Pizzas biggest brrand activityy is the returnn of its famoous tag, Pizzza! Pizza! (See
below.) Otherwise,
O
its
i marketingg seems foccused on an up-to-the-m
minute quickk response via
v its
Twitter account
a
(http
p://twitter.com/littlecaesaars) and Facebook.
Pizza!P
Pizza!return
ns
2
after a 15-year abbsence, Little Caesars announced
a
itt was reinstaating the tagg and
In June 2012,
Little Caaesar characcter to restoore fun to thhe brand. Said
S
Gerry Graf,
G
found a at BFG 9000
(creators of the camp
paign), It seeems like everyone got really
r
serious about pizzza all of a suddden,
talking abbout artisanaal pizzas andd apologizinng for the waay their pizzaa was made.. Bu if you take
t
a
step backk and look att pizza, its fun
f
(Adverttising Age, Juune 2012).
keting execuutive at Littlle Caesars, The
Little Caesar charracter and taagline

Said Ed Geich, mark
have extrremely stron
ng positive brand associaations.
Septemberr 2012
139
Pizza at Foo
R
Restaurant Brand An
nalysis
Newme
enuintrodu
uctionanalyysis
Aside froom its new flavors
fl
of Caaesar Wings, Little Caesaars seems to be resting on
o its laurels.
esarWings
NewvariietiesofCae
In Novem
mber 2011, Little
L
Caesarrs introducedd five new varieties
v
of Caesar
C
Winggs. There aree now
eight varrieties overaall, includingg Oven Roaasted, Buffallo, Barbequee, Spicy Barrbeque, Teriiyaki,
Lemon Pepper,
P
Garliic Parmesan and Bacon Honey
H
Musttard (PR New
wswire, Novvember 2011).
It seems as if Little Caesars
C
cant get enouggh of pushingg its Crazy Bread.
B
Aside from the Crazy
C
Ready pizza. Little Caesaars pizzas aree all under $10,
$
and mosst are
Bread, it focuses on its Hot-N-R
between $5-7, which
h is quite a deal.
d
We beliieve the brannd already seees itself as discountingg its
prices, soo most tradittional promootions arent necessary.
$5HotN
NReadypizzza
The $5 laarge peppero
oni Hot-N-R
Ready pizza, as well as the
t $8 large three-meat pizza
p
is the main
promotioon. (Advertissing Age, Junne 2012).
CrazyBre
eadduringb
basketball
In Marchh 2012, Littlee Caesars offfered baskettball fans a chance
c
to geet a free ordeer of Crazy Bread
B
on Mondday, March 19, 2012. If any 166-seeded teaam beats a 1-seeded team in a crazy,
c
unexpectted victory in
i the gamees played onn March 15 and 17 of the
t college mens
m
baskeetball
championnship tournaament, Little Caesars [would]
[
givee away one free Crazyy Bread to every
e
family thhat mentioneed the offer (PR Newsswire, Marchh 2012). Crrazy Break is
i Little Caeesars
most poppular side iteem.
CrazyBre
eadduringffootball
In Decem
mber 2011, Little
L
Caesarrs introducedd the Free Crazy
C
Breadd promotionn for footballl and
pizza fanns where customers couuld purchasee any HOT-N
N-READY pizza
p
and get
g an eight-piece
order of Crazy Bread
d free with a valid couppon. The couupon was vaalid from Dec. 27 Deec. 29
N
Januarry 2012).
(Marketinng Weekly News,
Septemberr 2012
140
Pizza at Foo
R
Restaurant Brand An
nalysis
CrazyBre
eadforVete
eransDay
In Novem
mber 2011, Little Caessars offered free Crazyy Bread to veterans
v
andd active military
memberss with prooff of militaryy standing at
a participating stores. The
T Little Caesars
C
Vetterans
Program was created
d in 2006 too thank veteerans for theeir service annd provide them
t
with career
c
y transition to
t civilian life.
l
Since thhe start of the
t program
m, more thaan 65
opportunnities if they
veterans have collecttively benefiited from nearly 1.6 milllion in creditts and discouunts to help them
open theiir Little Caesars stories (PR Newsw
wire, Novembber 2011). M
Giftcard
dmoves
In Decem
mber 2011, Little
L
Caesarrs introduceed a gift cardd for the hollidays. To offer added value,
v
the brandd included a Buy a $225 Gift Carrd Get a $5 Gift Card Free
F
offer. Gift cards were
availablee in over 85
5,000 retail locations accross the coountry, as well
w as at paarticipating Little
L
Caesars locations
l
(PR
R Newswire,, December 2011).
wardswithD
Discovercarrd
CardRew
In Decem
mber 2011, Little Caesaars launchedd a promotioon for Discoover cardmem
mbers to proovide
them witth extra vallue during the
t holidayss. During a limited tim
me, customerrs could earrn $5
Cashbackk Bonus in their Discovver card acccount. The $15
$ total coould be accuumulated thrrough
several visits
v
to Littlee Caesars (P
PR Newswiree, Decemberr 2011).
w
that promotes itss brand, but aside from an
a iPhone appp, has done little
Little Caaesars has a website
to capitallize on techn
nological innnovation. Thhis seems an area sorely lacking
l
from
m the brand.
iPhoneaapp
Little Caaesars has an
n app availabble for the iP
Pod touch or iPhone wheere a consum
mer can locatte the
nearest reestaurant, seee a detailedd map and diirections, leaarn store houurs and methhods of paym
ment,
and play Topping Drop
D
and heelp Little Caaesar catch tooppings for his
h favorite pizzas, and share
the high score on Tw
witter or Faceebook.
Buttheaapphasitsliimitations
First, unllike other pizzza chains and their avaiilable apps, a consumer cannot actuaally order a pizza
with the app. To be fair,
f
Little Pizza
P
pushes the HOT-N
N-READY menu
m
where there
t
is no need
to call ahhead! No neeed to wait! But that is conditionall on the HOT
T-N-READY
Y items. Seccond,
while theere is an Android app avvailable, as of
o this reporrt it was onlyy for the Litttle Caesars in El
Septemberr 2012
141
Pizza at Foo
R
Restaurant Brand An
nalysis
Cajon, CA.
Custome
ersegmenttationbym
Aside froom the categ
gory Do Not Own Cell Phone,
P
use allong all otheer segments is fairly flatt. The
same trend is true with
w the 1--5 visits perr month segment. Onlyy during thee 6 + visitts per
month does
d
the Mo
obirati shoot up to an index
i
of 218, almost tw
wice as mucch as the neearest
competitor, Mobile Professionals
P
s at an indexx of 116.
Graph10
05:LittleCaesarsUsage
eFrequencyyMobileSeggmentationAnalysis

a
the all average
a
i
in perce
entage likelihood
o all average; each
e
integer belo
one-point increase
one-point decrease
d
in perc
centage likelihood
d of agreement in comparison to all average
Source: Pa
b
on data fro
TheLittlleCaesarsConsumer
Keyconsumergrou
ups
Generalanyuse
18-34s, Hispanics,
H
th
hose with chiildren, and those
t
makingg $50-$74K are more likkely to visit Little
L
Caesars.
Engagedusers:
Among engaged
e
users (those whho have eateen Little Caeesars 1-5 tim
mes in the paast month), usage
u
by age iss still highesst among 188-34s, thouggh 25-34s skkew slightly higher. How
wever, Hisppanics
are by farr the highestt indexed consumers at 150,
1
followeed by black consumers
c
att 101.
Septemberr 2012
142
Pizza at Foo
R
Restaurant Brand An
nalysis
Households with inccomes of $550-$74 indeex of 119, but

b the brannd performs similarly across
a
householld income brrackets until it reaches $150K+. Connsumers withh children inndex much higher
h
than thosse without ch
hildren.
Highlyen
ngageduserrs:
18-24s arre twice as likely to vissit Little Caeesars multipple times as their nearest competitorr, 2534s. Blacck consumeers lead the Little Caesaars charge at
a an index of 263, clossely followeed by
Hispaniccs at 211.
me, <$25K users are m
most likely to use the brand 6+ tiimes per month,
m
By household incom
5K-$49K HH
H income users.
u
Againn, consumers with childdren index much
m
followedd by the $25
higher thhan those witthout childreen.
Septemberr 2012
143
Pizza at Foo
R
Restaurant Brand An
nalysis
Table1012:LittleCaesarsEngaggement:KeyyUsers
Demographic
c
U
Used
[Company]
Eaten in
i past 30 day
ys
1-5 times
6+ times
All
An
ny use
Male
Female
48%
52%
96
104
95
105
80
8
119
18-24
25-34
35-44
45-54
55-64
65+
12%
18%
18%
19%
16%
18%
162
160
117
83
61
35
142
167
119
85
59
39
27
70
13
39
7
77
7
75
8
80
1
15
White
68%
88
92
4
47
Hispanic
Black
Asian
15%
12%
4
4.6%
147
121
81
150
101
71
211
26
63
14
47
Northeast
Southeast
Central
Southwest
Pacific
20%
21%
27%
12%
20%
35
104
123
113
123
33
101
121
106
135
4
42
110
10
02
17
77
9
99
<$25K
$25-$49K
$50-$74K
$75-$99K
$100-$149K
$150K+
20%
24%
19%
13%
13%
12%
111
103
120
82
96
68
111
105
119
84
96
64
15
57
12
21
9
94
4
42
8
88
5
50
None
1
62%
16%
68
153
69
152
4
48
18
86
2
3+
13%
9%
136
128
120
130
19
94
10
01
Note: The index

x represents inde
above 100 corre
esponds to a one
e-point increase in
i percentage likkelihood of agree
ement in comparison to all
average; each in
nteger below 100
0 corresponds to
agreement in co
% higher
n the average.
Note: white, blac
ck and Asian dem
mographics are categorized
c
as non-Hispanic.
n
Source: Packag
ged Facts, based
d on data from 20
Consumer Survey
Septemberr 2012
144
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Restaurant Brand An
nalysis
200820
uencyanalyysis:
With its very
v
low priice points, Little
L
Caesarss is likely ridding the receession wave,, attracting valuev
consciouus consumerss willing to sacrifice
s
som
me quality foor a better prrice: among those who report
r
any use, as well ass those who use the brannd 1+ and 6+
+ times per month,
m
usagge penetration has
increasedd during 200
08-2012. Duuring this peeriod, its poppulation univverse has inncreased by more
than 10 million,
m
up almost
a
70%.
Taable1013:LLittleCaesarrsGuestTraafficTrends,20082012
Anyy use
P
Percent
P
Population
universe
1 to
o 5 visits per month
m
P
Percent
P
Population
universe
P
Percent
P
Population
universe
2
2008
2010
2012
6.9%
6
16.1
8.8%
20.7
11.3%
26.9
4.9%
4
11.4
6.2%
14.5
8.1%
19.4
0.7%
0
1.5
0.8%
1.8
0.9%
2.2
Sou
F
CS
Custome
ersegmenttationbyfo
oodlifestyle
e
Among consumers
c
who
w report aany use of Little
L
Caesarrs, Weekendd Cooks are more
m
likely to do
so. True Foodies and Reformedd Traditionall group mem
mbers (who seek healthhier fare) aree less
likely to eat Little Caaesars. The metrics
m
are similar for thhose who vissit 1-5 times per month.
6+visitsamonthatttractsVariettyonaBudgget
udget group is most likeely to visit Little
L
Caesarrs 6+ per moonth, indexiing at
The Variiety on a Bu
164. Thiss is not surprrising, as Litttle Caesars was rated thhe best valuee for the monney.
Septemberr 2012
145
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Restaurant Brand An
nalysis
Graph106:LittleCaaesarsUsaggeFrequenccyFoodSegm
mentationA
Analysis

a
the all average
a
i
in perce
entage likelihood
o all average; each
e
integer belo
one-point increase
one-point decrease
d
in perc
centage likelihood
d of agreement in comparison to all average
Source: Pa
b
on data fro
onth Winter 2012
2 NCS
et
CNNcallssLittleCaessarsagoodffranchisebe
In Noveember 2011,, CNN wroote that Litttle Caesars was one of ten greaat franchise bets
(moneycnnn.com, Nov
vember 20111).
Merchan
ndiseonitsw
website
Little Caaesars sells a variety of items
i
on its website, inccluding a Little Caesar 7 inch collecctible
doll, babyy bib, baseball cap, watcch and clothiing items.
Septemberr 2012
146
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Restaurant Brand An
nalysis
PapaJo
ohns
Compan
nyoverview
w
Papa Johhns Internatiional, Inc. operates
o
and franchises pizza
p
deliverry and carryoout restaurannts in
the U.S. and, in certtain internatiional markeets, dine-in and
a restaurannt-based dellivery restauurants
under thee trademark
k Papa Johnns. As of June 2012, Papa Johns had 3,9733 restaurant units
worldwidde, 3,118 off which weree located in the U.S. andd Canada. Packaged
P
Faccts estimatess that
Papa Johhns North American
A
syystem-wide restaurant sales
s
reacheed $2.31 billion in 2011, up
5.6% from
m 2010.
Restauraantsnapshot
A typicaal Papa Joh
hns restauraant averagess 1,100 to 1,500 squarre feet withh visible extterior
signage. The typical interior of a Papa Johns restaurant has a vibrannt color scheeme, and includes
a bright menu
m
board,, custom couunters and a customer caarryout area. The counterrs are designned to
allow cuustomers to watch team
m members slap
s
out thee dough andd put sauce and toppinggs on
pizzas. During
D
2011, a substantiial majority of restaurannts in the Unnited States installed a lobby
l
enhancem
ment re-desiign package,, with the reemaining dom
mestic francchisees expeected to com
mplete
the lobbyy enhancemeent program during 20122.
Restaurannt units incllude traditioonal domesstic Papa Johns restaurrants, which are deliveryy and
carryout units that seervice a defiined trade arrea, and noon-traditionaal restaurants, which seerve a
captive customer
c
gro
oup with conntinuous operations or ann event-driveen service, such
s
as univeersity
food servvice, stadium
ms, entertainm
ment venuess, military baases and airpports.
Menuovverview
U.S. Pappa Johns reestaurants offfer a menu of quality-positioned pizza
p
along with side ittems,
includingg breadstick
ks, cheese stticks, chickken strips annd wings, dessert
d
itemss and canneed or
bottled beverages.
b
Papa
P
Johns traditional crust pizzaa is prepared using fresh dough (nnever
frozen). Papa
P
Johns pizzas are made
m
from a proprietaryy blend of whheat flour, cheese made from
100% real mozzarella, fresh-paacked pizza sauce madee from vine-ripened tom
matoes (not from
concentraate) and a proprietary
p
m of savorry spices, annd a choice of high-quaality meat (1100%
mix
beef, porrk and chickeen with no fillers)
fi
and veegetable toppings.
gredients annd toppings can be purcchased from
m its Qualityy Control Center
C
Domesticcally, all ing
(QC Ceenter) systtem, which delivers too individuall restaurantss twice weekly. To ennsure
consistennt food qualiity, each dom
mestic franchhisee is requuired to purchhase dough and
a tomato sauce
s
from ourr QC Centers and to purrchase all othher supplies from our QC
Q Centers or
o other apprroved
supplierss.
Septemberr 2012
147
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Restaurant Brand An
nalysis
In additioon to traditio
onal crust piizza, Papa Johns offerss a thin crustt pizza, whicch is a par-bbaked
product produced
p
by
y a third-parrty vendor. Its
I traditionaal crust pizzaa offers a coontainer of garlic
g
sauce annd a pepperroncini peppper. Each thhin crust pizzza is serveed with a packet
p
of sppecial
seasoninggs and a pep
pperoncini peepper.
Brandsttrategy
Papa Johhns brand lo
oyalty strateggy is built onn the followiing:
Offering high
O
h quality mennu offerings
R
Running
an efficient
e
operrating system
m
C
Commitment
to team mem
mber traininng and develoopment
N
National
and local marketing campaiggns
C
Continuing
to
o build a stroong franchisee system
Pursuing international groowth
Brandinggthatreflecttsqualitypo
ositioning
This includdes continuinng to forge relationships
Its brandding reflectss its quality positioning.
p
r
s with
partners (such as Pep
psi) that helpp tell its Beetter Ingrediients. Better Pizza. storry to increassingly
wider auddiences.
Strategypayingoff
This strattegy appearss to have paiid off, in the form of awaards, recognnition and salles growth.
Inn a report raanking all coompanies (inncluding airllines, expresss delivery and
a hotels), Papa
Joohns rated No.
N 1 in Lim
mited Service Restaurantt by the Am
merican Custoomer Satisfaaction
Inndex, with th
he highest category scorre in survey history (Buusiness Wire, June 2012)). Its
thhe 11th timee in the pastt 13 years thhat Papa Johhns has possted the highhest score am
mong
national pizzaa businessess. Said John Schnatter, Papa
P
Johnss Founder annd CEO, B
Better
Inngredients, Better
B
Pizza has been the
t foundatioon of everytthing we strrive foritss this
loong-term com
mmitment too qualitytthat has drivven our succcess. Papa Johns scoreed an
83.
The ACSI ran

T
nking follow
ws positive attribution
a
inn the 2012 Harris
H
Poll EquiTrend
E
S
Study,
w
which
named
d Papa Johnns as its 20012 Pizza Brrand of the Year due too the compaanys
quuality and co
onsumer preeference.
As detailed in
A
i Sales Peerformance (see below
w), domesticc company-oowned restaaurant
coomparable sales
s
increassed 4.1% in 2011, and they
t
spiked 7.4% duringg the first haalf of
2012.
Septemberr 2012
148
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R
Restaurant Brand An
nalysis
Marketing&brand
dactivity
Papa Johhns marketin
ng strategy consists
c
of booth national and local coomponents.
d
Itts domestic national strrategy includdes nationall advertisingg via televission, print, direct
m
mail,
digital and social media channnels. The companys
c
o
online
and digital
d
markketing
acctivities have increased significantlyy over the paast several yeears in respoonse to increasing
coonsumer usee of online annd mobile web
w technoloogy.
Local restaurrant-level maarketing proograms targeet consumerss within thee delivery arrea of
L
eaach restauran
nt through thhe use of loccal TV, printt materials, targeted
t
direect mail, storre-todoor flyers, email marketing, text messages
m
annd local soccial media. Local markketing
effforts also include
i
a variety of coommunity-orriented activvities withinn schools, sports
s
venues and other
o
organiizations suppported with some of thhe same advvertising vehhicles
m
mentioned
ab
bove.
Loyaltyaandgiftcard
dprograms
During 2010,
2
the com
mpany impleemented the Papa Rewarrds program,, which is ann online custtomer
loyalty program
p
desiigned to incrrease consum
mer use of its
i online/diggital orderinng platform. Papa
Johns reeceives a peercentage-baased fee from
m U.S. frannchisees for online salees, in additioon to
royalties,, to cover thee cost of thiss service.
It also offfers a reload
dable gift carrd marketedd as the Pappa Card, whhich is also sold to consuumers
through third-party
t
retailers.
r
Thee Papa Card may be reddeemed for delivery,
d
carrryout, onlinee and
mobile web
w orders an
nd is accepteed at all Papaa Johns tradditional dom
mestic restaurrants.
mething rightt. Sales are growing, trraffic is stabble, and as far
f as
Papa Johhns must bee doing som
awards programs
p
aree concerned, its a qualityy brand. Thee brand also gets a disprooportionate share
of traffic from highly
y-engaged (66+ visits per month) wom
men, which says a lot abbout what woomen
t brand as a trusted souurce to feed their familiees.
think of the
Papa Johhns continuees to exploree variety in its
i menu, esppecially withh its use of chicken,
c
a leearner
protein with
w the kind
d of health profile
p
that might
m
be fouund on pizzaa at Californiia Pizza Kitchen.
Finally, Papa
P
Johns relationshipp with the National
N
Foootball Leaguee ties the brrand to the years
y
biggest pizza
p
eventt, the Superr Bowl, andd Papa Johhns continuues to leverrage this unnique
relationshhip in many of its promootions.
Septemberr 2012
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R
Restaurant Brand An
nalysis
Menuin
nnovation
Papa Johhns continuees to test neew product offerings
o
booth domestically and inteernationally. The
new products can become
b
a part
p
of the permanent menu if they meet ceertain established
guidelinees.
Newme
enuintrodu
uctionanalyysis
Papa Johhns has not rested
r
on its laurels; the brand has inntroduced a variety
v
of neew offerings and
promotioons to attractt and maintaiin its custom
mer base.
PizzaLTO
ChickenParmesanP
In July 2012,
2
Papa Johns introoduced Chiccken Parmessan to pizzaa. Said Andrrew Varga, chief
marketinng officer, C
Chicken Parm
mesan is a premium
p
offfering that many
m
people enjoy at upsscale,
fine diniing Italian restaurants
r
a
around
the country. Weve
W
taken it to anothher level andd are
offering the
t popular flavor combbination on a pizza (Heaalth & Beauty Close-Upp, July 2012)). The
pizza is offered
o
at $1
10. Consumeers can also order any otther large pizzza, with upp to five topppings,
for only $2
$ more.
BuffaloC
ChickenPizzaLTO
In Marchh 2012, Papaa Johns lauunched its neew Buffalo Chicken
C
pizza, a combinnation of creeamy
ranch sauuce, all-whitte slice chickken strips, crrispy bacon, fresh-slicedd onions andd fresh cheesse, all
topped with
w buffalo sauce.
s
Its avvailable for $10. Said Andrew Varga, chief marrketing officeer for
Papa Johhns, Consu
umers have spoken andd weve listeened. Ameriica told us that
t
they waanted
Buffalo Chicken
C
and
d that bacon was
w a favoriite (Marketiing Weekly News,
N
Marchh 31).
eppersPizzaaLTO
ClassicSaausage&Pe
In Novem
mber 2011, Papa
P
Johns introduced the Classic Sausage & Peppers, a pizza
p
loadedd with
sausage and
a peeper, available
a
forr $11.
Septemberr 2012
150
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nalysis
Table1
1014:PapaJohnsNew
wOfferings:XXX
Item
Chicken Parmesan
P
Pizz
za
Buffalo Chicken Pizza

Classic Sausage
S
& Peppers Pizza
Double La
ayered Pepperroni
Premium Pepperoni Piz
zza
Spicy Italian Pizza
Sausage Sensations Piz
zza
Hearty Ita
alian Meats Piz
zza
Descripttion
G
Garlic
parmesa
an, pizza sauce
e, sliced chicken strips,
m
mozzarella,
Parmesan cheese
e, romano chee
ese and
Ittalian herb sea
asoning
A ranch base to
opped with mozzzarella, onions, bacon,
c
chicken
strips and
a mild buffalo
o wing sauce
S
Sausage
and peppers,
p
onionss, red peppers, mild
Ittalian sausage
e and parmesan
n romano
T
Two
layers of pepperoni
p
with layer of 100%
m
mozzarella
and
d Italian herb se
easoning on top
P
Pepperoni
and double portion
n of spicy Italian
n sausage
Spicy Italian sa
S
ausage, sweet sausage,
s
smokked
s
sausage,
green
n and red pepp
pers, onions and
m
mozzarella
with
h herb seasonin
ngs on original crust
T
Three
cheese blend,
b
Italian sa
alami, spicy Ita
alian
s
sausage,
Italian
n ham and pep
pperoni
P
Price
Datte
introdu
uced
$
$10
May 2012
2
$
$10
Jan 20
012
Nov 2011
LTO
O
$
$11
$
$11
$
$10
Oct 20
011
2
June 2011
LTO
O
$
$11
May 2011
2
$
$16
Feb 2011
Source: Pa
b
on data fro
Pizzacom
mbinationsfflexvaluepo
ositioning
Papa Johhns incorporates beveerages and sides into its recent pizza
p
prom
motions to create
c
competitively positio
oned pizza value bundless.
Table10
015:PapaJohnsNewP
Promotions:XXX
Item
Any Large Pizza & 2 Liter Pepsi Max
M
Larg
ge Two Topping
g Pizza
Any Large Pizza & Cheesesticks or Breadstickss
Price
$12.99
$10
$16
Date Introduced
I
Ju
uly 2012
June 2012
June 2011 LTO
acts, based on data from Datasse
ential Menu Tren
nds Direct
s
as Dom
minos and Little
L
Caesarrs, push disccounts, Papaa Johns has been
While otther chains such
trying hard
h
to hold
d the line on
o discountting, insteadd sticking with
w
its longg-held prem
miumproducts--at-premium
m-prices messages (Adveertising Agee, March 20112).
Said David Hale,

H
CEO off Good Eats,, a food conssultancy, deeep discountinng doesnt build
looyalty or consistency its cheapenning your prroductpeoople will buyy products while
w
prrices are dow
wn, but mayy not when prices
p
go up.
However, in
H
n a price-drriven consuumer enviroonment, discounting reemains a highly
h
coompetitive tool:
t
Papa Joohns foundder John Schhnatter admittted rivals deep discouunting
crreated uneveen results forr the companny in 2011.
Septemberr 2012
151
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Restaurant Brand An
nalysis
This heighten
T
ns the need for Papa Joohns to com
mpetitively price
p
its mennu items wiithout
faalling into a deep discoounting trapp that could erode
e
the higgher-food quuality positiooning
itt has fought hard
h
to mainntain.
Advertisiingmatters
Notably, Papa Johns was outsppent in advvertising dollars by Pizzza Hut and Dominos. Papa
Johns sppent $112 million
m
on media
m
in thee U.S., as coompared to $219.60 miillion and $1185.5
million, respectively
r
(Advertisingg Age, March 2012).
But while Papa John
ns system-w
wide domestiic sales fall below
b
those of Pizza Huut and Domiinos,
the comppany has raccked up posiitive same-sttore sales duuring 2011 and
a 2012 whhile also groowing
locationss, which sugg
gests its advvertising dolllars may be well
w spent annd well alloccated.
1040SSpecialfortaaxdayproccrustinators
In April 2011, Papa Johns offerred a large, original crusst pizza withh up to four toppings for just
offer made to be
$10.40. The
T 1040 promotion ran
r from Appril 15-18 annd was an online-only
o
convenieent for the growing
g
num
mber of Am
mericans whoo file their taxes
t
onlinee (Business Wire,
April 20111).
Relation
nshipwithN
NFL
Papa Johhns relationsship with thee NFL is its most importtant promotiional and maarketing tooll, and
one that no other pizza
p
chain can claim. It continues to push the
t boundariies of integgrated
marketinng, as exampled by the Coin
C
Toss proomotion.
NFLandPepsi
In 2011, Papa Johnss completed the second year
y of its thhree-year spoonsorship wiith the NFL,, with
ficial Pizza of
o the NFL and the Supper Bowl. Paapa Johns also
a
enhanceed its
Papa Johhns the Offi
NFL affiiliation throu
ugh a new partnership
p
w PepsiCoo. As one off the NFLs largest sponnsors,
with
PepsiCo has brought it several coo-branding opportunities
o
s.
1Million
nPizzaNFLG
Giveaway
mber 2011, Papa
P
Johns offered a chhance for its customers and
a new enroollees in the Papa
In Septem
Rewards loyalty pro
ogram to recceive (by raandom selecction) one off the 60,0000 free large onep
it willl award eachh week durinng the NFL regular
r
seasoon (Health & Beauty Cllose
topping pizzas
Up, September 2011)).
Septemberr 2012
152
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R
Restaurant Brand An
nalysis
SuperBo
owlXLVICoinTosslandssonheads
In February 2012, with
w an integgrated markeeting campaiign called thhe Papa Johhns Super Bowl
B
XVLI Cooin Toss Ex
xperience reesulted in a free large pizza
p
and 2--liter Pepsi MAX
M
to all Papa
Rewards Members. Said
S
John Schnatter,
S
N
No matter whhich team you
y are rootiing for, everryone
enrolled in Papa Reewards walkks away a winner afteer Super Boowl XLVI. Its our waay of
celebratinng a terrific NFL season and rewarrding our loyal Papa Reewards custoomers (Bussiness
Wire, Febbruary 2012).
PapaJoh
hnsofferedfreepizzaiffSuperBow
wlwentintoovertime
In Januarry 2011, and
d taking advvantage of itts multi-yearr partnershipp with the NFL,
N
Papa Joohns
announceed a promottion that it would
w
offer a free largee pizza to evveryone in America
A
if Super
S
Bowl XL
LV went into overtime. Consumers needed to register
r
for Papa
P
Johns online custtomer
loyalty program,
p
Paapa Points (F
Food and Beverage
B
Cllose-Up, Jannuary 2011). Ultimatelyy, the
Super Boowl did not go
g into overttime.
hnsheartsh
hapedpizza
PapaJoh
y in 2011, Papa Johns once agaain offered a heart-shaaped pizza. Said
For Valeentines Day
companyy representaative Andrew
w Varga, For
some, our heart-shaped pizzaa has becom

me a
Valentinees Day trad
dition (Markketing Weeklly News, Febbruary 2011)).
orTeacher2011CollecttionDrive
Toolsfo
In July 2011,
2
all Laas Vegas Vaalley Papas Johns locaations served as drop-off and colleection
centers for
f the 12-daay Tools for
fo Teachers school suppplies drive, with the goal
g
of colleecting
20,000 ittems necessaary to benefits children and
a teachers..
3,000thNorrthAmerican
nrestaurantt
Celebratesopening3
In Octobber, 2011 and marking the opening of the 3,0000th store in North Amerrica, Papa Joohns
gave awaay 3,000 slicces of pizza for free at the
t 3,000th store
s
locatedd in Burbankk, Illinois. Itt also
donated 3000 canned
d goods to the
t Girl Scouuts of Greatter Chicago and Northw
west Indiana,, who
were onee hand (Busin
ness Wire, October
O
20111).
Papa Johhns understaands that a strong technnology platfform is criticcal for its fuuture successs. Its
digital orrdering platfform allows customers to
t order onliine, and inclludes plan ahead orderring,
Spanish-language orrdering capaability, and enhanced mobile
m
web ordering for our custom
mers,
Septemberr 2012
153
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R
Restaurant Brand An
nalysis
includingg Papa John's iPhone andd Android appplications.

Firstcom
mpanytoreaach$2billioninonlinessales
In May 2011,
2
Papa Johns becam
me the first pizza
p
chain too reach $2 billion in onliine sales (beeating
larger rivvals Pizza Hut
H and Doominos to the punch).. The comppany websitee is availabble in
Spanish, which faciliitates online Hispanic pizza sales.
PapaJoh
hnsturnedttoRadwareforfastdeliivery
Papa Johhns, with an
n e-commercce website thhat had earneed $2 billionn, needed to stay ahead of
o the
technologgical curve to
t support itss applicationn and networrk infrastrucctures. It alsoo wanted to boost
b
response times and increase capacity to handle largge amounts of online traffic
t
and offer
free experiennce. It turnedd to Radwarre. Papa Johhns has sincce experienceed a
customerrs a hassle-fr
substantiial increase in networkk and efficciency throuughout its worldwide
w
operations (PR
Newswire, March 2011).
AndroidandiPhoneappexplosiion
Papa Johhns launch
hed the Anddroid app in
i 2011, onn the heelss of launchhing a revam
mped
Papajohnns.com onlin
ne ordering site and iPhhone app inn 2010. Theese investmeents helped Papa
Johns acchieve record
d online andd mobile salees in 2011.
The appllication, un
nlike compettitors, perforrms all functtions of the Papa Johnss website (F
Food
and Beveerage Close--Up, Januaryy 2011).
Onlinepizzaloyaltyprogram
In 2011, Papa Johnss introduced the only national onlinee pizza loyallty program,, Papa Points, in
n earn pointts towards frree pizza wiith each onliine purchasee. Once enroolled,
which cuustomers can
customerrs earn one point
p
for eveery $5 spentt online; wheen customerrs accumulatte 25 points,, they
receive a free pizza with
w up to thhree toppingss (Food and Beverage Close-Up, January
J
20111).
Mixingp
pizzawithpo
oliticsexpossessocialme
ediadangerss
While coompanies lev
verage the poower of sociial media, all it can take is one pebbble in the waater to
send rippples through
hout the soocial media universe. According
A
too Politico, in
i August 2012,
2
during a conferencee call with annalysts, Papaa Johns CEO John Schnnatter said Obamacare
O
w
would
raise the price of pizzza somewheere between $0.11
$
to $0.14. Were not
n supportivve of Obamaacare,
like mostt businesses in our induustry (mashhable.com). Reports of Schnatters comments led
l to
an outcryy on Twitter and Facebook. Accordinng to NetBaase, responsee to the brandd on social media
m
has been negative.
Septemberr 2012
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nalysis
While thhese commu

unications may
m not havee led directlly to lowereed sales, theey do expose the
danger off blending pizza
p
with pooliticsand the possibiliity that polittics could leaad pizza salees out
the door.
Custome
ersegmenttationbym
Higher-fr
frequency Paapa Johns users (6+ visits
v
per moonth) are more
m
than tw
wice as likeely as
average to belong to
t the Mobiirati group. They are closely
c
folloowed by Soocial Connecctors.
Notably, Mobile Professionals arre less likelyy by almost 100%.
1
Mobirati represent th
he mobile geeneration. Thhey grew up with cell phhones and caannot imaginne life
without them.
t
Cell ph
hone devices are a centrral part of theeir everydayy lives.
Communnication is ceentral in the lives of Social Connectoors. Their ceell phone alloows them to keep
up-to-datte with frien
nds and soccial events. The
T cell phhone device is the bridgge to their social
s
world.
Graph107:PapaJo
ohnsUsageFrequencyMobileSegm
mentationA
Analysis

a
the all average
a
i
in perce
entage likelihood
o all average; each
e
integer belo
one-point increase
one-point decrease
d
in perc
centage likelihood
Source: Pa
b
on data fro
paJohnsCo
onsumer
ThePap
Althoughh the Papa Jo

ohns brand appeals acrooss all incom
me brackets,, it caters to the center, as
a far
as househhold incomee goes, skew
wing to midddle class connsumers. In comparisonn to leading pizza
chains Dominos
D
and
d Pizza Hutt, women are standout high-frequen
h
ncy users. We
W believe thhis is
due to the brands ap
ppeal on not just
j value, but
b also qualiity.
Septemberr 2012
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nalysis
Keyconsumergrou
ups
Generalanyuse
b
consum
mers and thoose with 1+ kids
k are morre likely to use
u Papa Johnns. Comparred to
18-24s, black
Dominos and Pizza Hut, Papa Joohns also skkews to a sliightly higherr-income connsumer.
Engagedusers:agerreversal,raccial/ethnicd
disparity,sollidlymiddleclassandffamilydriven
Among engaged
e
userrs (those whho have eatenn Papa Johns 1-5 times in the past month),
m
usagge by
age skew
ws to 25-44s, followed by
b 18-24s, which
w
suggessts greater reeliance on faamilies and more
established households than on thhe youngest adults.
Black consumers, wh
ho index at 178,
1
are almoost twice as likely as Hispanic or whhite consumeers to
be engagged Papa Joh
hns users.
K-$74K housseholds, squuarely positiooning
The brannd also attraccts a dispropportionate shhare of $50K
them as a middle-claass destinatioon.
Consumeers with chilldren (indexxing at 143) are twice ass likely as those withouut children too use
the brandd 1-5 times a month, firm
mly positioniing the brandd as a familyy destinationn.
Highlyen
ngageduserrs:women?
Among highly
h
engag
ged users, thhe brand conntinues to attract
a
a dispproportionatee share of $50K$74K houuseholds, sq
quarely positioning them
m as a middlee-class destinnation.
But in a departure frrom other major
m
pizza brands,
b
wom
men are 50% more likelyy than men to
t eat
Papa Johhns 6+ timees per monthh. Many of these
t
womenn may be buusy mothers picking up pizza
for their families in an effort too provide ann easy-to-serrve, higher-qquality meal they know their
kids will enjoy. On a related notte, householdds with 1+ children
c
indeex at 160, allmost three times
t
a driving Papa
more thaan househollds without at 64, whicch suggests consumers with kids are
Johns saales.
The brannd also perfo
forms very well
w among highly engaaged Asian consumers, who index at an
eye-poppping 396, maaking them almost
a
twicee as likely as black conssumers to soo engage witth the
brand, more
m
than thrree times ass likely as Hispanics
H
too do so, andd seven timees more likeely as
white connsumers to eat
e Papa johnns 6+ timess per month.
Howeverr, by age, 18
8-24s are moost likely to use the braand, suggestiing that its value
v
and quuality
positioninng resonatess with youth as well as families.
fa
Septemberr 2012
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nalysis
Table10
016:PapaJo
ohnsEngage
ement:KeyUsers
Demographic
c
U
Used
[Company]
Eaten in past 30 day
ys
1-5 times
6+ times
All
An
ny use
Male
Female
48%
52%
93
107
93
107
76
7
12
23
18-24
25-34
35-44
45-54
55-64
65+
12%
18%
18%
19%
16%
18%
164
141
135
92
54
31
134
159
143
95
50
26
20
06
9
98
14
42
8
89
8
87
1
12
White
Hispanic
68%
15%
86
89
87
91
5
55
118
Black
Asian
12%
4
4.6%
174
153
178
122
22
21
39
96
Northeast
Southeast
Central
Southwest
Pacific
20%
21%
27%
12%
20%
77
151
89
94
88
67
173
83
93
84
9
97
12
28
5
58
14
41
10
07
<$25K
$25-$49K
$50-$74K
$75-$99K
$100-$149K
$150K+
20%
24%
19%
13%
13%
12%
92
90
106
111
105
105
83
88
120
103
113
103
15
50
9
90
6
68
17
78
2
22
8
83
None
62%
77
74
6
64
1+
38%
138
143
16
60
Note: The index

x represents inde
above 100 corre
esponds to a one
average; each in
nteger below 100
0 corresponds to
agreement in co
% higher
n the average.
c
as non-Hispanic.
n
Source: Packag
ged Facts, based
d on data from 20
Consumer Survey
200820
uencyanalyysis:positivvemomentum
a
Paapa Johns guest
g
traffic has improveedno smalll feat
Both throough the recession and afterward,
in a pressured foodseervice enviroonment that has seen restaurant pizzza sales slow
w to a crawl. The
mers who siimply use the brand has
h increaseed from 2008 to 2012, albeit
a
with a sliight drop fro
om 2010 to 2012.
2
Higherr-engagemennt trends are also healthyy.
Septemberr 2012
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nalysis
Table1017:
T
PapaJohnssGuestTraffficTrends,2
20092012
Anyy use
P
Percent
P
Population
universe
1 to
m
P
Percent
P
Population
universe
P
Percent
P
Population
universe
2
2008
2010
2012
7.8%
7
18.1
8.6%
20.3
8.4%
20.1
5.2%
5
12.1
5.4%
12.7
5.8%
13.7
0.5%
0
1.3
0.6%
1.4
0.6%
1.4
Sou
F
CS
Custome
ersegmenttationbyfo
oodlifestyle
e
For anyy use and 1-5 visits peer month, thhose tendingg to eat heallthier (Reforrmed Traditiional)
and Truee Foodies are
a less likkely to eat Papa Johns. They are
a offset, however,
h
byy the
Convenieence & Easee, Variety onn a Budget annd Weekendd Cooks grouups.
6+visitsamonthatttractsVariettyonaBudgget
Those in the Variety
y on a Budgeet are far andd away morre likely to visit
v
Papa Joohns, indexiing at
159.
Graph108:PapaJJohnsUsage
eFrequencyyFoodSegm
mentationAn
nalysis

a
the all average
a
i
in perce
entage likelihood
o all average; each
e
integer belo
one-point increase
one-point decrease
d
in perc
centage likelihood
Source: Pa
b
on data fro
onth Winter 2012
2 NCS
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Restaurant Brand An
nalysis
Salespe
erformance
e
Salesgro
owthtrendin
ngupward
As refleccted in the daata housed in
i the table below,
b
Papa Johns has performed
p
w during 2011well
2
2012. Affter registeriing slightly negative (U
U.S. companny-owned) saame-store saales in 20099 and
2010, sam
me-store salees have trendded upward in 2011 andd during the first
f
half of 2012.
2
wned restauraant sales inccreased $22..6 million, or
o 4.5%, in 2011
In 2011, domestic company-ow
primarilyy due to an in
ncrease in coomparable saales of 4.1%
%.
This com
mpares favorrably to 20110, when doomestic com
mpany-owneed restaurantt sales decreeased
approxim
mately $550,,000 primariily due to a decrease off 0.6% in coomparable saales for dom
mestic
companyy-owned resttaurants for the
t year.
During thhe first half of 2012, dom
mestic comppany-owned restaurant sales
s
increased $15.9 miillion,
or 12.4%
%, and $21.0 million, or
o 7.9%, for the three and six moonths endedd June 24, 2012,
2
respectivvely, due to increases
i
in comparable sales of 7.4%
% and 5.1% and the net acquisition of 50
restaurannts in Denverr and Minneeapolis from a franchiseee in the seconnd quarter of 2012.
Unitexpansioncontinues
During 2012,
2
Papa Jo
ohns expectts expect nett unit growthh of approxiimately 240 to 280 units (110
to 130 neet openings for
f North Am
merica and 130
1 to 150 neet openings for international).
houtpacesd
domesticgro
owth
Internatiionalgrowth
As of Deecember 25, 2011, 822 Papa
P
John's restaurants
r
o
operated
in 32
3 countriess and Puerto Rico
(excludinng Canada, which is inncluded in North
N
Ameriica franchisiing). Substaantially all of
o the
Papa Johhn's internatiional units are
a franchiseed operationss (it owns annd operates 30 restaurannts in
Beijing and
a North China).
C
Durinng 2011 andd 2010, it oppened 113 and
a 74 interrnational nett new
units (neew unit openings less unit
u closingss), respectivvely. Its totaal internatioonal developpment
pipeline as of Decem
mber 25, 20111 included approximateely 1,200 resstaurants with approxim
mately
40% scheeduled to op
pen in the nexxt three yearrs.
Septemberr 2012
159
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nalysis
Table101
18:PapaJoh
hns,Selecte
edMetrics,2
200912
Fiscal year
y
December
2009
2010
2011
200
09-11
2010-11
Total worldwide
w
restaurant units
Total North America
an units
U.S
S. company-ow
wned
Norrth American frranchised*
Non
n-North Americ
can
3,469
2,834
588
2,246
635
3,646
2,937
591
2,346
709
3,882
3,061
598
2,463
821
11
1.9%
8.0%
1.7%
9.7%
29
9.3%
6.5%
%
4.2%
%
1.2%
%
5.0%
%
15.8%
%
North American
A
restaurant sales revvenue ($mil)
U.S. company-owne
ed
North
h American fran
nchised**
$2,127
7
$504
$1,624
4
$2,187
$503
$1,684
$2,310
$526
$1,784
8.6%
4.4%
9.9%
5.6%
%
4.6%
%
5.9%
%
U.S. co
ompany-owned
d same-store sa
ales growth
-0.50%
%
-0.60%
4.10%
Total worldwide
w
restaurant units
Total North America
an units
U.S
S. company-ow
wned
Norrth American frranchised*
Non
n-North Americ
can
H1
2011
3,733
2,988
595
2,393
745
H1
2012
3,973
3,118
643
2,475
855
%
change
6.4%
4.4%
8.1%
3.4%
14.8%
North American
A
restaurant sales revvenue ($mil)
U.S. company-owne
ed
North
h American fran
nchised**
$1,151
1
$266
$884
$1,180
$287
$893
2.5%
7.9%
0.9%
3.3%
4.4%
2.9%
3.3%
5.1%
2.7%
North American
A
syste
em-wide same--store sales gro
owth
U.S. co
ompany-owned
d
North American
A
franc
chised
*In 2011
1, this included 60
6 restaurants loccated in Canada; 2,403 were loca
ated in the U.S.
**Packa
aged Facts estimate
s, based on Papa
a Johns public documents
d
Septemberr 2012
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nalysis
PapaM
Murphys
Compan
nyoverview
w
Accordinng to the com
mpany, Papaa Murphy's is
i the fifth-laargest pizza chain in thee country annd the
pioneer and leader of the take 'n' bake piizza segmennt. Papa Muurphy's operrates over 1,300
1
franchiseed and corp
porate-owneed locations in 37 staates and Cannada. Basedd in Vancoouver,
Washinggton, the com
mpany offerss custom-maade pizzas featuring
fe
fressh toppings layered on pizza
p
dough thhat is made frresh each moorning. By baking
b
Papaa Murphy's pizzas
p
at hom
me, customerrs get
to experience the hom
me-baked arroma of a convenient, deelicious meal that the braand is knownn for.
In additioon to handm
made pizzas, the companyy offers a grrowing menuu of other takke 'n' bake ittems,
includingg Cheesy Brread, Cinnam
mon Wheelss, and chocoolate chip coookie doughh. Papa Murrphy's
was receently voted #1
Rated Pizza
P
Chain by surveyoors in Zagat Survey's 20010 & 2011 Fast
Food Surrveys and is a four-time recipient of Pizza Todayy's Chain of the Year aw
ward.
Menuovverview
As adverrtised, the Paapa Murphys menu feattures pizza made
m
fresh right
r
in fronnt of a custom
mers
eyes, muuch like watcching chefs at a restauraant. Consum
mers then coook it at homee, and eat it right
out of thhe oven. Wh
hile known primarily for
f its pizzaas, it does offer
o
sides, including
i
saalads,
cheesy brread and desssert.
Papa Muurphys know
ws its nichee and it playys to it well.. Marketing itself as thee antidote too late
deliveries and greassy pizza, it also positioons itself ass a (literallyy) fresh alteernative to those
k healthier alternatives. Along thesse lines, new
w menu innnovations feeature
consumers who seek
( leaner, healthier proteein) and evenn zucchini.
chicken (a
p
fun wiith seasonal shapes piizzas, such as
a the Halloween
As far ass promotions, it keeps pizza
jack-o-laantern or the Valentines Day heart-sshaped pizzaa.
Menuin
nnovation
Newme
enuintrodu
uctionanalyysis
Papa Muurphys playss to consumeers who wannt fresh ingreedients and a meal cookeed at home. It
I
continuess to branch out
o into new
w flavor combbinations, suuch as the Taaco Grande Pizza
P
, Thai
Chicken Delite and Bacon
B
Cheesseburger Pizzza. It has alsso introducedd the Mini Murph
M
(see
below), targeted
t
to kids.
Septemberr 2012
161
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Restaurant Brand An
nalysis
MiniMurphMaken
nBakePizzaKit
In Marchh 2012, Papa Murphys introduced the Mini Murph
M
Make N Bake Pizza Kit. Thhe kit
includes seven inch
h pizza crusst rolled ouut on Papa Murphys signature
s
baake-n-serve tray;
containerr of pizza saauce; generouus amount of
o 100% all-natural, whoole-milk mozzzarella; neaarly a
dozen sliices of real pepperoni; temporary Murph
tatttoo; and bakking instrucctions. A chheese

only option is also available. Said Jenifer Anhorn,
A
Chiief Marketinng Officer att Papa Murpphys,
We wannted to makee family pizzza night eveen more funn and weve met that gooal with the Mini
Murph. The
T kids likeed that it gaave them a roole in the faamilys meall preparationn process. Others
O
loved usiing the Minii Murph as an
a activity at
a their childds birthday party
p
(PR Newswire,
N
M
March
2012).
Table1019
9:PapaMurphysNewO
Offerings:20
0112012
Item
SMores Dessert
D
Pizza
The Combo Magnifico
Taco Gra
ande Pizza
Thai Chiccken Delite
Chicken Parmesan
P
Delite Pizza
Bacon Ch
heeseburger Pizza
Descriptio
on
Desssert pizza with
h real Hersheyys semi-sweet chocolate
chips, lightly toastted mini marsh
hmallows and delicious
d
crissp topping
Zessty red sauce, new crust, a New York style not
too
thin
n, not too thick crust, large de
eli sliced peppe
eroni,
sau
usage, mushrooms, onions, mozzarella,
m
parrmesan
che
eeses and herb
bs
Fre
esh ingredientss with refried be
eans, salsa, 10
00% real
mo
ozzarella and ch
heddar cheese
e, seasoned be
eef taco,
gre
een onions, black olives and tomatoes
Tha
ai chicken mad
de with chili sau
uce, grilled chiccken,
zuccchini, mixed onions, mozzare
ella cheese on crispy
thin
n crust
Grilled chicken, to
omatoes, parmesan cheese, chopped
c
nd 100% real mozzarella
m
cheese on
garrlic, spinach, an
crisspy thin crust
Burrger sauce, gro
ound beef, crisp
py bacon, roma
a
tom
matoes, mixed onions,
o
chedda
ar cheese and dill
pickles
P
Price
Datte
introdu
uced
$3
Feb 2011
$
$8-9
March 2011
LTO
O
$
$10
May 2011
2
LTO
O
$8
June 2011
2
LTO
O
$9
Jan 20
012
$
$10
Feb 2012
LTO
O
Source: Pa
b
on data fro
motions revollve around seasonal

s
item
ms, such as thhe Jack-o-Laantern and HeartH
Papa Muurphys prom
shaped pizzas, as well as $8 pizzza deals.
Table1020:PapaM
MurphysNew
wOfferings:2011
Item
Heart Shap
ped Pizza
Any Large Pizza
Jack-O-Lantern Pizza
Descripttion
P
Price
Three 100% rea

T
al cheese with premium pepp
peroni
A large pizza
Any
a with up to 3 to
oppings, exclud
ding
s
stuffed
pizzas
T
Three
100% rea
al cheeses and
d premium pep
pperoni in
a fun jack-o-lan
ntern shape
$7
$8
$7
Date
Introd
duced
2
Feb 2011
LTO
Feb 2011
2
LTO
Oct 2011
2
LTO

ased on data from
m Datassential Menu
M
Trends Dire
ect
Septemberr 2012
162
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Restaurant Brand An
nalysis
TaxDaySpecial
In April 2012, like competitor
c
P
Papa
Johns, Papa Murphhys also rann a Tax Dayy Special: a large
pepperonni pizza for $5.
$
RelayForLifePrograam
In Januarry 2012, Pap
pa Murphyss announcedd it joined thhe 2012 Am
merican Canccer Society Relay
R
For Lifee National Team
T
Progrram. Employees and frranchise ow
wners will raise
r
moneyy and
awarenesss in the figh
ht against canncer (qrsmaggazine.com, January 20112).
Marketing&brand
dactivity
$35millionadcamp
paign
In Marchh 2011, Papaa Murphys launched
l
a $35
$ million media
m
campaign in an atttempt to sollidify
the brannds core message
m
of offering
o
a high-quality
h
y, customizaable pizza at
a a lower price
(Nationss Restaurantt News, Marrch 2011). Thhe campaignn included teelevision com
mmercials, radio,
r
online, print
p
and in
n-store com
mponents annd urged coonsumers too Join thee Take n Bake
Revolutioon. Said Jeenifer Anhorn, Were all trying too steal sharee and everyoones being very
aggressivve with valuee. We want to
t be perceivved as the beest value forr pizza.
The pizzza segment has been challenging
c
with aggresssive discouunting and riising comm
modity
costs, buut Papa Murp
phys operrating modell (no dine-inn service; noo need for ovens)
o
allow
ws the
chain to pass
p savingss to customerrs with loweer pricing.
The Joinn the Revolu
ution on Faacebook alloows consum
mers to get discounts
d
if they
t
Like Papa
Murphys. There is also
a an eCluub where consumers cann sign up onn Papa Murpphys websitte for
deals all year long.
TakeNG
GrillGiveaw
way
In June 2012,
2
Papa Murphys
M
lauunched its Take
T
N Grilll Giveaway on the com
mpanys Faceebook
page. Coonsumers cou
uld enter to win one off 42 daily prrize packs, inncluding a Weber
W
grill. Said
Carron Harris,
H
vice president off Papa Johnns product development
d
t, A grilledd Papa Murpphys
pizza is delicious
d
and
d the experieence is fun (PR Newswiire, June 20112).
Septemberr 2012
163
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Restaurant Brand An
nalysis
LumberjaackPizzaCo
ontest
In associiation with the Portlandd Timbers, an Americaan soccer team based inn Portland, Papa
Murphys launched a contest in 2012 to dessign the new
w Timbers-innspired Lum
mberjack Pizza!
(portlanddtimbers.com
m). Using thhe ingrediennts and guiddelines provvided, consuumers can create
c
their own unique reecipe. A Grrand Prize Winner
W
will have his/hher Lumberjaack Pizza recipe
r
featured on Papa Mu
urphys menuu and receivee a free Papaa Murphys Pizza a monnth for a yearr.
Phizzlem
mobilemarkketingrelatio
onshipexten
nded
In Auguust 2012, Paapa Murphyys expandeed its partneership with mobile maarketing proovider
Phizzle. The
T mobile product is avvailable in nearly
n
550 frranchised resstaurants throough 26 stattes. A
partner since
s
2010, Papa Murphys runs customized in-store
i
signnage, mobilee campaignss and
promotioons featuring
g mobile aleerts. Said Jeenifer Anhoorn, Consum
mers are seeeking fasterr and
more flexxible ways to
o access ourr restaurants.. Its importaant for us to offer new and
a exciting ways
for our cuustomers to
engage wiith Papa Murrphys (mobilepaymenttstoday.com,, August 20112).
ookpromisin
ng
Redempttionrateslo
Through Phizzles proprietary
p
m
mobile
platfo
form, the frranchises haave seen reddemption rattes as
high as 18%
1
from th
he offers deliivered to theeir specific mobile
m
databbase and tracked in real-time
through Phizzles
P
mo
obile platform
mmost cuustomershaave upgraded their purchhases.
Custome
ersegmenttationbym
D
P
Pizza
Hut annd Papa Johhns, which draw most heavily from
m the
Unlike competitors Dominos,
S
Mobirati mobile seegmentation group, Paapa Murphyys draws most heaviily from Social
urphys alsoo differentiattes itself froom these othher brands byy drawing highly
h
Connectoors. Papa Mu
engaged Mobile Proffessionals annd engaged Pragmatic
P
Adopters.
PragmaticAdopters:engagedusserswhovaaluebrandattributes,no
otmobileco
onnectivity
H Pragmaatic Adopterrs are
When coompared to other pizza chains like Dominos and Pizza Hut,
more likeely to visit Papa
P
Johns 1-5
1 times per month.
Cell phones came

C
c
to life for Pragmaatic Adopterrs in their addult years. They
T
are the ones
w are still learning there are otheer things to do with youur phone beeyond just saaying
who
Septemberr 2012
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Restaurant Brand An
nalysis
H
Hello. Celll phones aree more a paart of their everyday
e
liffe than befoore but still more
fuunctional thaan entertaininng to them.
Mobile conneectivity is noot paramounnt to these consumers.

M
c
M
More
likely, these are peeople
w are takin
who
ng an extra step (rather than just buuying a pizzza and bringging it home) and
m want a more
may
m
cookedd-at-home feeelneeds amply
a
fulfilleed by Papa Murphys
M
taake n
bake position
ning.
Highlyen
ngagedSocialConnecto
orsandMob
bileProfessio
onalsdiffere
entiatebran
nd
Social Connectors arre most likeely to visit Papa
P
Murphyys 6+ timess, followed by Moberatti and
Mobile Professionals
P
s.
Papa Murphy
ys Facebookk promotionnal tie-ins maay be findinng a ready auudience in Social
S
Connectors. This
C
T is becaause communnication is central
c
in thee lives of Soocial Connecctors.
T
Their
cell pho
one allows them
t
to keepp up-to-datee with friendds and sociall events. Thee cell
phhone device is the bridge to their soccial world.
Highly engag
H
ged Mobile Professionals are also more
m
apt to gravitate too Papa Murpphys
thhan to Dom
minos, Pizzaa Hut and Papa
P
Johnss, which sugggests their appreciationn for
quuick-pick up
p options theey can makee at home. Mobile
M
Profeessionals usee their cell phone
p
too help them keep
k
up withh their profeessional life in
i addition too their persoonal life.
Graph109:PapaMu
urphysUsaggeFrequencyyMobileSegmentation
nAnalysis

a
the all average
a
i
in perce
entage likelihood
o all average; each
e
integer belo
one-point increase
one-point decrease
d
in perc
centage likelihood
Source: Pa
b
on data fro
Septemberr 2012
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nalysis
ThePap
paMurphyssConsume
er
Papa Muurphys appeeals to whitee consumerss, those livinng in the Pacific region,, consumers with
3+ childrren, and high
her-income users.
u
The philosop
T
phy behind freshly
f
madee take n baake pizza coonnects withh consumers who
w
wish
to coo
ok dinner at
a home witthout the haassle, while providing a relatively highquuality meal for
f families and individuuals.
Overall, Papa Murphyss also draw

O
ws a higher ratio of high-income consumers than
coompetitors such
s
as Pizzaa Hut and Doominos.
ys draw am
mong consuumers residing in the Pacific
P
regioon is due too the
Papa Murphy
brrands regional focus in that area.
Generalanyuse
25-34s, women,
w
whiite consumeers, and thosse with 3+ more
m
kids are
a more likkely to visit Papa
Murphys. While tho
ose with household incoomes >$1500K lead the way indexiing at 129, every
e
other houusehold inco
ome categoryy is not far behind, with the exceptioon of those <$25K.
<
Engagedusers
ow almost exactly
e
the same
s
breakddown, with the exceptiion of houseehold
Engaged users follo
K-$149K leaad, followedd closely by
b those maaking
incomes. Here housseholds makking $100K
$150K+.
ngageduserrs
Highlyen
Highly enngaged userrs follow the metrics in any
a use, withh the exceptiion of race. Black consuumers
lead withh an index off 159, follow
wed by white consumerss at 94. Thosse with 3+ children
c
are twice
t
as likely to visit 6+ tiimes as the nearest
n
categgory, those with
w only one child.
Septemberr 2012
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nalysis
Table102
21:PapaMu
urphysEngaagement:Ke
eyUsers
Demographic
c
U
Used
[Company]
ys
1-5 times
6+ times
All
An
ny use
Male
Female
48%
52%
85
115
85
114
88
8
111
18-24
25-34
35-44
45-54
55-64
65+
12%
18%
18%
19%
16%
18%
108
138
126
89
72
68
77
138
121
90
74
91
26
2
20
02
8
84
12
25
7
77
5
59
White
68%
112
125
9
94
Hispanic
Black
Asian
15%
12%
4
4.6%
45
98
84
47
32
63
53
5
15
59
8
84
Northeast
Southeast
Central
Southwest
Pacific
20%
21%
27%
12%
20%
20
40
117
86
229
5
24
121
94
249
7
78
7
9
97
7
77
23
34
<$25K (HH inc

come)
$25-$49K
$50-$74K
$75-$99K
$100-$149K
$150K+
20%
24%
19%
13%
13%
12%
69
103
88
106
126
129
49
106
97
111
137
124
72
7
10
03
3
35
12
29
17
73
13
33
0 (Kids in HH))
1
62%
16%
81
119
87
120
6
66
14
40
2
3+
13%
9%
101
195
95
160
12
20
23
35
Note: The index

x represents inde
above 100 corre
esponds to a one
average; each in
nteger below 100
0 corresponds to
agreement in co
% higher
n the average.
c
as non-Hispanic.
n
Source: Packag
ged Facts, based
d on data from 20
Consumer Survey
200820
uencyanalyysis
As show
wn below, Paapa Murphys guest trafffic has grow
wn moderateely but steaddily during 20082
Septemberr 2012
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nalysis
2012, witth gains in any
use and in highly engaged

e
(6+ visits per month)
m
use.
Tab
ble1022:P
PapaMurphyysGuestTraafficTrends,20082012
2
Anyy use
P
Percent
P
Population
universe
1 to
m
P
Percent
P
Population
universe
P
Percent
P
Population
universe
2
2008
2010
2012
3.1%
3
7.2
3.5%
8.2
3.7%
8.8
1.9%
4.3
2.2%
5.1
2.1%
5.0
0.3%
0
0.7
0.4%
1.0
0.5%
1.2
Sou
F
CS
Custome
ersegmenttationbyfo
oodlifestyle
e
The brannd differentiaates itself onn the basis off drawing high-frequenccy use from True
T
Foodies and
mid-frequuency use frrom Weekennd Cooks.
me. They preffer to
True Fooodies are passsionate about food and spend a lot of time cookking at hom
buy orgaanic food, want their inggredients freesh and buy environmenntally friendlly products. True
Foodies tend
t
to eat a variety of food,
f
love too experimennt with differrent cuisiness and at the same
time havve adopted a healthy eatting lifestylee. They havee the most culinary
c
expeertise and haave a
love relattionship with
h food.
Weekendd Cooks hav
ve some interest in cookking, but are mostly sociiable home chefs.
c
Whenn they
can find some time in their buusy schedulee they like to cook forr friends annd/or family. For
b less form
mal and lesss time consuuming. Weeekend
Weekendd Cooks meeal preparatiion should be
Cooks likke to indulge in food that they cravve without chhecking on calories
c
or nutritional
n
vaalues.
There is no conflict between tassty food andd healthy food for them
m; a tasty way
w
is a heealthy
way. Thheir relationsship with foood is more likke a leisure activity in ittself.
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nalysis
hysUsageFFrequencyFo
oodLifestyleSegmentaationAnalysis
Grraph1010:PapaMurph

a
the all average
a
i
in perce
entage likelihood
o all average; each
e
integer belo
one-point increase
one-point decrease
d
in perc
centage likelihood
Source: Pa
b
on data fro
Salespe
erformance
e
Papa Muurphys anno
ounced in February 20112 that its 2011 sales grrew more thhan 10% to $702
million. It also addeed more thann 800 employyees as its loocations greew to 1,300 (bizjournals.
(
.com,
Februaryy 2012).
2 stores and
a 30 new
w franchise entity
e
Franchisee agreementts signed inn 2011 equaate to over 265
grounds. Papa Murp
phys endedd 2011 withh over 500 franchise ow
wners in 377 states andd two
Canadiann provinces (prnewswire
(
e.com, Februuary 2012).
eDeals
Franchise
In June 2011,
2
QRS Magazine
M
naamed Papa Murphys
M
as one of the 10
Best Fraanchise Dealls as
the pizzaa chain is on
ne of the few
w pizza chaiins to reportt significant growth in the 21st Cenntury,
doublingg both is un
nit count andd sales since 1999 withh a concept many feel matches toddays
lifestyless (qrsmagazzine.com, Junne 2011).
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nalysis
PizzaHu
ut
Pizza Huut, a subsidiiary of YUM
M! Brands, operates
o
thee world's larrgest pizza chain,
c
with more
than 13,0000 outlets in
i about 90 countries woorldwide. Thhe chain serrves a varietyy of pizza sttyles,
includingg its flagship
p Pan Pizzaa, as well ass Thin n' Crispy, Stuffe
fed Crust, Hand
H
Tossedd, and
Sicilian. Other menu items incclude pasta, salads, andd sandwichees. Pizza Huut offers diine-in
service at
a its characcteristic red--roofed restaurants, as well as carrry-out and delivery serrvice.
About 155% of the resstaurants aree company-ooperated, whhile the rest are
a franchiseed.
Menuovverview
Critics of
o Pizza Hutt claim that its new offferings are more aboutt novelty annd gimmickss, i.e.
cheesy bites
b
pizza crust. Whille other chaains focus on
o flavor, like
l
Dominoos, Pizza Huts
H
marketinng seems to be
b more about keeping pizza
p
fun. This approaach helps diffferentiate it from
other braands. Consu
umers may argue whichh pizza tasttes better, but
b its clearr that Pizzaa Hut
continuess to push thee envelope innto what the very definittion of a pizzza crust can be.
Pizza Huut has sometthing to crow
w about: in a survey froom the Ameerican Consuumer Satisfaaction
Index, diiners at national chain restaurants
r
a most sattisfied with Pizza Hut. (The ACSI is an
are
annual survey
s
of about
a
80,0000 Americanns across a wide variiety of connsumer servvices)
(McClatcchy-Tribune Business News,
Ne
June 20011). Indexinng at 81, Pizzza Hut leadds the way, ahead
a
of Little Caesars (80)), Papa Johnns (79), and Dominos (777).
Growthstrategy
ontinuestogathersteam
Franchisiingmodelco
The U.S. business traansformationn measures in
i 2011, 2010 and 2009 included: coontinuation of
o our
marily
U.S. reffranchising; G&A prodductivity iniitiatives andd realignmeent of resoources (prim
severance and early retirement costs); a reeduced emphhasis on muulti-brandingg as a long--term
growth strategy; and
d investmentts in our U.S
S. Brands maade on behaalf of our fraanchisees suuch as
equipmennt purchasess.
In the U..S., we are targeting
t
Coompany ownnership of KF
FC, Pizza Hut
H and Tacoo Bell restauurants
of about 8%, down from its cuurrent level of 13%, with
w
our prim
mary remainning focus being
b
refranchiising at KFC
C and Taco Bell
B to about 5% and 16%
% Company ownership, respectivelyy.
We are continuing
c
our U.S. refraanchising prrogram. Ourr plan is to retain about 5% ownershhip in
KFC andd Pizza Hut and
a to be at this
t target ow
wnership forr both brandss by the end of 2012.
g
in 20010, Pizza Hut
H deliveredd modest grrowth in 20111, driven by the
Followinng positive growth
companyys focus on everyday vaalue, new prroducts and value
v
bundlees, which thhe company plans
to continue to leverag
ge going forrward.
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nalysis
Pizza Huut maintainss an aggresssive stance in its use of Faceboook and Twiitter promottions,
successfuully drawing
g in social coonnectors forr somewhat frequent usee.
SuperBow
wlSundayaaBonanza
On Februuary 5, 2012, Pizza Huut expected to surpass 2 million pizzas sold annd more thaan 16
million slices
s
on Sup
perBowl Suunday, makinng it the chaains busiestt day of thee year (Foodd and
Beveragee Close-Up, February 20012).
Menuin
nnovation
Newme
enuintrodu
uction&pro
omotionan
nalysis
PZolotaakesaimatssubs
The PZ
Zolo is Pizzza Huts firre across thhe bow at sandwiches and subs, reinforced with
advertisinng taglines such
s
as Seee Ya Subs. This
T is the PZolo
P
and Say so lonng to a footloong.
The $3 (or
( 2 for $5)) price poinnt and its thrree flavor varieties makke it quite a competitor. The
Italian Stteak resemblles a Philly Cheesesteak
C
k, while the Meat
M Trio PZolo channnels the Strom
mboli
for inspirration.
message
SubwayTTakeoverprromotiondrriveshomem
To help promote
p
its June
J
2012 PZolo introdduction, Pizzza Hut launchhed a Subw
way Takeoveer by
th
commanddeering a paair of subwayy cars in Chiicago. On Juune 7 , Pizzaa Hut passedd out free PZ
Zolos
at select spots, later announced on its Faceebook page. Said Kurt Kane,
K
Pizza Hut CMO, Its
i leaving thhe sub categgory behind (PR
more thaan a sandwicch. Its a neew flavor creeation that is
Newswire, June 2012
2).
ustsandbreaadsmakingwayontom
menu
Pizzacru
With the introduction
n of the Ultiimate Stuffeed Pizza Cruust, Cheesy Bites
B
Pizza and
a Garlic Bread
B
Pizza, the brand conttinues to tinkker and expand on whatt defines a crust,
c
giving these offerings a
firm line--up with the other novellty pizza offeerings.
Septemberr 2012
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nalysis
Ultimate
eCheeseLovversPizzaD
Deal
In May 2011,
2
Pizza Hut promotted its Loverrs Line of pizzas:
p
Peppperoni Loverrs, Meat Loovers
and Vegggie Lovers, and the all-new Ultimatte Cheese Lovers, availlable for $100.99 for a lim
mited
time onlyy. The Ultim
mate Cheese Lovers pizzza comes with
w a combiination of Alfredo
A
saucee and
three cheeese: roman
no, parmesaan and Pizzza Huts siggnature cheeese. Again using Facebbook,
consumers could visiits the Loverrs Lovers taab to enter inn order to win
w a daily off a $50 Pizzaa Hut
gift card and a weeklly prize of frree pizza for a year (PR Newswire,
N
M 2011).
May
Ultimate
eStuffedCru
ustPizza
In April 2011, Pizzaa Hut rolled out the Ulttimate Stuffe
fed Crust pizzza, where, for the first time
ever, topppings are follding into thhe crusts.
As part of the prom
motion, Pizzaa Hut folded money inn the form of
o $1,000 innto the crustt and
embarkedd on a secreet mission to
t deliver thhe money-stuuffed pizzass to unsuspeecting custom
mers.
Pizza Huut turned to its Twitter followers
f
too find out whhat should be
b stuffed innto the next crust
(Food annd Beverage Close-Up, April
A
2011).
For exam
mple, in July 2012, Pizzaa Hut introduuced Garlic Bread
B
Pizza,, a combinattion of hot melted
m
cheese annd pizza topp
pings on ninne pieces of garlic
g
bread (Entertainm
ment Close-U
Up, July 20122).
CheesyB
Bitesintrodu
uctiongetsaasupportinggcastofchaaracters
In Springg 2012, Pizzza Hut relauunched Cheeesy Bites Piizza, 28 pulllable, dippabble, cheese-filled
morsels. The compan
ny says it is an all-time favorite
f
and combines taaste with a litttle fun foood.
To help promote
p
thee April 2012 return of Cheesy
C
Bites Pizza, Pizza Hut introdduced the Chheesy
Bites Gaang, a band of 28 charaacters that have
h
commaandeered thee Pizza Hutt Facebook page.
p
Pizza Huunt intended to introducce members of the gang with each character
c
of the
t crust spoorting
a personaality of its ow
wn (Entertaainment Closse Up, Aprill 2012).
As part of
o the promo
otion, on Appril 30, Pizzza hut askedd Facebook fans
f
to chooose from a list of
activitiess to be carrieed out in puublic by a Chheesy Bites character annd shared viaa a weekly video
v
called Chheesy Bites Reality
R
Reell.
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nalysis
Table1023:PizzaaHutNewO
Offerings:Pizzza,SandwicchesandBre
ead
Item
Ultimate Stu
uffed Pizza Crust
Cheesy Bites Pizza
Buffalo Chiccken PZolo
Italian Steakk PZolo
Meat Trio PZolo
Garlic Bread
d Pizza
Description
e with three top
ppings and com
mes in a stuffe
ed-crust
Available
choice of
o pepperoni orr meaty, which
h included pep
pperoni,
Italian sa
ausage and baccon
A pizza made
m
with 28 cheese-filled
c
bites that surrou
und the
perimete
er in the place of
o a crust.
Freshly baked in a so
oft golden cru
ust, filled with tender
grilled ch
hicken breast strips covered in bold and
d spicy
buffalo seasoning,
s
the
en topped with
h asiago cheesse and
served with
w choice of marinara
m
or rancch dipping sauce
Freshly baked
b
in a sofft golden crust,, filled with ma
arinated
steak, ro
oasted peppe
ers, onions an
nd mushrooms then
topped with
w
asiago cheese and se
erved with cho
oice of
marinara
a or ranch dippiing sauce
Freshly baked in a so
oft golden cru
ust, filled with Italian
a
ham then topped with asiago
sausage, pepperoni and
cheese and served with
w
choice off marinara orr ranch
s
dipping sauce
Hot meltted cheese an
nd pizza toppiings on thick buttery
garlic bre
ead.
P
Price
D
Date
$1
12.99
A
April
201
11/LTO
$1
11.99
A
April
201
12/LTO
$3 or two
fo
or $5
ne 2012
Jun
$3 or two
fo
or $5
ne 2012
Jun
$3 or two
fo
or $5
ne 2012
Jun
$
$8.99
Jun
ne 2012
Source: Packa
aged Facts, base
ed on data from Datassential Me
enu Trends Direct
ngthewealtthwithfamilydeals
Spreadin
milies, Pizza Hut
H introducced its Big Box
B Dinner LTO,
L
To provide incentivees for value-sseeking fam
ment to its $10 pizza deaal.
a supplem
BigDinne
erBoxprom
motionandR
RedRoofWe
ednesday
In Novem
mber 2011, before Thannksgiving, Pizza
P
Hut lauunched its Big
B Dinner Box
B LTO, a box
filled with two med
dium rectanggular one-toopping pizzaas, eight winngs and fivee breadstickks for
$19.99. The
T Big Din
nner Box is one of the pizza cateegorys first ever value boxes offerring a
combinattion of pizzza and side items in a single
s
packaage. Said company
c
reppresentative Kurt
Kane, W
We know thaat our custom
mers need a value-consccious option that can feed a crowd during
d
the holiddays. (PR Newswire,
N
Noovember 20111).
p
n that rivals Black
B
Red Roof Wednesday, the day beefore Thanksgiving, is a consumer phenomenon
onday. Housseholds are packed
p
with visitors, students, and faamily lookinng for
Friday annd Cyber Mo
a quick meal.
m
Pizza Hut researchers said 2.44 million poounds of Pizzza Hut pizzza are ordereed on
Red Roof Wednesday
y (the equivalent of 151,000 turkeyss).
GameSto
optiein
To help promote thee Big Dinneer Box, Pizzza Hut delivvered them to hundredss of gamerss at a
GameStoop retail sto
ore; paratrooopers literally dropped from the sky
s
during the
t Blue Angels
Homecom
ming Air Sh
how, surprissing spectattors and servvice men annd women; and at sea by a
replica off the Mayflo
ower made of
o Big Dinner Boxes thatt arrived neaar Plymouth Rock.
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nalysis
$10AnyPizzaDeal
In Januarry 2012, Pizzza Hut rang in the Neew Year by bring back the $10 Anny Pizza Deaal. In
conjunctiion with thee promotion,, the companny asked fanns to top thhis by sendding in theirr own
renditionns of the son
ng from the commercial for a chancce to be in thhe next ad. Consumers
C
c
could
upload thheir rendition
n of the songg to the Pizzza Hut Facebbook page inn order to ennter the Pizzaa Hut
Top Thiss! Contest. Pizza
P
Hunt will
w then pickk six grand prize
p
winnerrs who will also
a receive a gift
card for Pizza
P
Hut vaalued at $5999 (Entertainm
ment Close Up, January 2012).
The prevvious year haad an ad featturing runninng back Regggie Bush where
w
he wass traded for a $10
pizza. The
T
ad prom
moted the $10
$
Any Pizza Deal (PR
(
Newsw
wire, Septem
mber 2011). The
promotioon originated
d in 2010.
Table1024:PizzzaHutNewOfferings:FFamilyMeals&$10Deaals
Item
Description
D
Dinner in a box filled with
w two medium rectangular onetopping pizzas, eight win
ngs and five bre
eadsticks
Any pizza, any size, anyy toppings
Big Box Din

nner
$10 Any De
eal Pizza
Prrice
$19
9.99
$10
D
Date
Intro
oduced
Novv 2011
/L
LTO
Jan
n 2012
Source: Packkaged Facts, bas

sed on data from Datassential Me
enu Trends Direcct
With the help of Faccebook, Tim
m Tebow andd Zynga, Pizzza Hut has actively marrketed a rannge of
products,, as detailed below.
owpartnere
edwithBOO
OKIT!
TimTebo
Book IT
T!, a reading
g incentive program spponsored byy Pizza Hutt to host Am
mericas Biggest
Storytime, an annuall celebrity webcast to encourage readding among children, paartnered withh Tim
Tebow, who read Green
Egggs and Ham

m (Entertainnment Newssweekly, Maarch 2012). The
previous webcast occcurred in 20011, when Juustin Beiber read The Cat
C in The Hat
H to moree than
500,000 viewers.
v
Promotion
PZoneP
Not to bee confused with
w the PZ
Zolo, the PZ
Zone is Pizzaa Huts version of a calzzone. In an effort
e
to make it more pop
pular, in Auggust 2011, Pizza
P
Hut maade an onlinne offer: if consumers L
Like
Pizza Huut on Faceb
book, they would receeive a free PZone with any pizzza purchase (PR
Newswire, August 2011).
2
Said Kurt Kane,, Our custoomers contiinue to facee tough spennding
decisionss in an unccertain econnomy, so weve
w
decidded to rewaard those who
w
like us
u on
Facebookk.
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nalysis
PizzaHuttPartnersw
withZyngato
oBenefitHu
ungerRelief
Pizza Huut partnered with Zynga during the 2011
2
World Hunger Rellief campaiggn with its S
Share
a Slice of
o Hope. It integrated with
w game developer
d
Zyynga via onlline contribuutions (Heallth &
Beauty Close-Up,
C
Occtober 2011)).
PizzaHuttoffersmob
bileorderinggapps
In July 2010, Pizza Hut
H introduceed an iPhonee applicationn allowing cuustomers to download
coupons and place orrders throughh their mobiile phones.
2
Pizza Hut offeredd free mobilee ordering appps for the Android
A
andd Apple iPadd and
In May 2011,
iPhone (F
Food and Beverage Cloose-Up, Mayy 2011). Saidd Baron Conncors, Chieff Informationn and
Digital Officer,
O
Weeve heightened consum
mer engagem
ment by obseerving our customers digital
d
lifestyless and making
g our food easily
e
availaable to them
m on their preeferred platfforms. And well
continue to evolve ass they do. The
T new feattures includee:
Full Pizza Hu
ut menu
G
Guest
checko
out
O
Orders
are au
utomatically saved to a customers acccount for eaasy reorderinng
M popularr items sectioon provides access to a customers
Most
c
P
Pizza
Hut favvorites
Specials sectiion providess updates on new products and deals
C
Customers
caan add creditt card optionns without crreating an acccount for eaasy checkoutt
Pizza Huut claims it now

n
offers more
m
pointss of access than
t
any othher national pizza chain with
mobile ordering appss.
Custome
ersegmenttationbym
DrawingfromMobilleGeneratio
onandSociaalConnectorrs
Higher-fr
frequency users (6+ visitts per monthh) are about 2.5 times ass likely as average
a
to beelong
to the Moobirati group
p. All other groups
g
are leess likely to visit Pizza Hut
H 6+ timess per month.
Mobirati reprresent the mobile

M
m
generration. Theyy grew up with
w cell phhones and caannot
im
magine life without
w
them
m. Cell phonee devices aree a central part of their everyday
e
livees.
w
visit Pizzza Hut 1-55 times perr month incclude Mobile Professioonals and Social
S
Users who
Connectoors, 15% and
d 19%, respeectively.
C
Communicati
ion is centraal in the livess of Social Connectors.
C
T
Their
cell phhone allows them
Septemberr 2012
175
Pizza at Foo
R
Restaurant Brand An
nalysis
too keep up-to

o-date with friends
f
and social
s
eventss. The cell phone
p
devicee is the briddge to
thheir social world.
w
Graph10
011:[Comp
pany]Usage
eFrequencyMobileSegm
mentationA
Analysis

a
the all average
a
i
in perce
entage likelihood
o all average; each
e
integer belo
one-point increase
one-point decrease
d
in perc
centage likelihood
Source: Pa
b
on data fro
ThePizzzaHutConssumer
Keyconsumergrou
ups
Generalanyuse:yyouth,region,andrace
18-34s, black
b
consum
mers, those living in the Southwest, and those with 3+ kids are
a more likeely to
visit Pizzza Hut for aany use. Whhile there aree differencess by househoold income, they are minnor.
Engagedusers:youtth,region,an
ndrace
Users whho visited Pizza
P
Hut 1--5 times in the
t past 30 days tell thhe same storry: 18-34s, black
b
consumers, those liv
ving in the Southwest,
S
thhose with 3+
+ kids, and a household income between
$50-$74K
K are most liikely to makke repeat visits to Pizza Hut.
H
Highlyen
ngageduserrs:HHincom
meaddsatw
wist
Highly engaged userrs, those who have visited Pizza Huut 6+ times in
i the past month,
m
repeaat the
pattern, except
e
on stteroids. 18-224s are almoost twice as likely to vissit Pizza Huut 6+ times when
w
comparedd to its clossest bracket; black consuumers indexx at 277 (with Asian consumers at 162);
Once agaain, the Soutthwest lovess its Pizza Hut, indexingg at 184. Fam
milies with 3+
3 kids indexx at a
223.
Septemberr 2012
176
Pizza at Foo
R
Restaurant Brand An
nalysis
Household income, however,

h
becomes a muuch more im
mportant usagge determinaant among highly
h
engaged users: <$25K
K HH incom
me users indeex at 198, whhile $25-$499K HH incom
me users inddex at
128.
Table1
1025:PizzaHutEngagem
ment:KeyU
Users
U
Used
[Company]
Demographic
c

ys
1-5 times
6+ times
All
An
ny use
18-24
25-34
35-44
45-54
55-64
65+
12%
18%
18%
19%
16%
18%
140
122
116
99
85
50
126
125
118
98
87
54
18
89
10
00
9
92
10
09
9
96
4
43
White
Hispanic
Black
68%
15%
12%
92
100
144
94
101
131
5
53
15
58
27
77
Asian
4
4.6%
120
113
16
62
Northeast
Southeast
Central
Southwest
Pacific
20%
21%
27%
12%
20%
75
105
116
136
77
71
108
117
140
75
10
03
10
04
10
00
18
84
4
43
<$25K
$25-$49K
$50-$74K
$75-$99K
$100-$149K
$150K+
20%
24%
19%
13%
13%
12%
100
103
112
95
97
83
93
103
115
93
100
89
19
98
12
28
8
82
7
73
3
32
1
13
No kids in HH
1 in HH
2 in HH
3+ in HH
62%
16%
13%
9%
84
126
113
149
83
126
117
145
86
8
112
5
57
23
34
Note: The index

x represents inde
above 100 corre
esponds to a one
average; each in
nteger below 100
0 corresponds to
agreement in co
% higher
n the average.
c
as non-Hispanic.
n
Source: Packag
ged Facts, based
d on data from 20
Consumer Survey
Septemberr 2012
177
Pizza at Foo
R
Restaurant Brand An
nalysis
200820
uencyanalyysis
At Pizza Hut, guest traffic
t
has treended downward duringg 2008-12. During
D
this period of timee, the
percent of
o the adult population visiting Pizzza Hut fell 1.5 points, with
w 1-5 visit-a-month usage
u
falling onne percentag
ge point. Higgh-frequencyy usage also dropped.
Table1026
6:PizzaHutGuestTraffiicTrends,20
0082012
Any use
A
Percent of adu
ult population
Population universe
Percent of adu
ult population
Population universe
6+ visits per mo
onth
Percent of adu
ult population
Population universe
2008
2010
2012
20.9%
48.7
20.2%
47.5
19.4%
46.1
15.5%
36.1
14.6%
34.2
14.6%
34.8
1.8%
4.3
1.4%
3.4
1.5%
3.7
Source: Packaged
d Facts, based on
o data from 12-M
Month 2009, 2010, 2011, and 201
12 Experian Simmons
er Survey
National Consume
Custome
ersegmenttationbyfo
oodlifestyle
e
Engagedusers
For engaaged consum
mers (those viisiting 1-5 tiimes per month), two seggmentation groups
g
standd out:
Weekend
d Cooks ind
dex at 142 and
a Conven
nience & Eaase at 118. Conventiona
C
al wisdom would
w
say thosee numbers sh
hould be sw
witched. Weeekend Cooks have somee interest in cooking, buut are
mostly soociable hom
me chefs. Whhen they cann find some time in theiir busy scheddule, they liike to
cook for friends and//or family. Pizza
P
Hut may be doing a good job of enticing people who have
f
some knoowledge of food.
Highlyen
ngageduserrs
Among users
u
who have
h
visited 6+ in the paast month, the
t Variety on a Budget group is more
than twicce as likely as
a the averagge to eat Pizzza Hut 6+ peer month.
Septemberr 2012
178
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R
Restaurant Brand An
nalysis
Graph1012:PizzaaHutUsage
eFrequencyFoodSegme
entationAn
nalysis

a
the all average
a
i
in perce
entage likelihood
o all average; each
e
integer belo
one-point increase
one-point decrease
d
in perc
centage likelihood
Source: Pa
b
on data fro
onth Winter 2012
2 NCS
Septemberr 2012
179
Pizza at Foo
R
App
pendix
Appendix
A
INTRO
ODUCTION
N
In this chapter, Pa
ackaged Faccts analyzess the followin
ng retail prep
pared foodss platforms: Costco
C
ding prepare
ed food visitt); Tesco PL
LC/Fresh & Easy, The Kroger Co. (including Food
F
4
(includ
Less and
a
Ralphs prepared fo
oods store visits),
v
Safew
way Inc. (in
ncluding Dom
minicks and
d Vons
preparred food store visits), SU
UPERVALU INC. (includ
ding Albertsons prepare
ed food store
e visit);
Targett Corporatio
on (including
g SuperTarg
get prepared
d food store
e visit); Wa
almart Store
es, Inc.
(includ
ding Walmarrt Neighborh
hood Expresss and Walm
mart Neighb
borhood Sto
ore prepared
d foods
visit; and
a Whole Foods Market (including prepared
p
foo
od visit).
Method
dology
ersurveyme
ethodology
Consume
Data relaated to consumer demoggraphics, atttitudes and behaviors
b
iss derived froom The Expperian
Simmonss National Consumer
C
Suurvey, a boooklet-based survey
s
of a large and raandom sampple of
consumers who in aggregate
a
reepresent a sttatistically accurate
a
crooss-section of
o the U.S. adult
populatioon (age 18+
+). We analyyze results from its 20007, 2008, 2009,
2
2010, 2011 and 2012
surveys. For 2012, th
he Winter annd Spring surrveys are both referenced.
We also include selected results from Packagged Facts August
A
2012 proprietary consumer suurvey
of 2,000 online resp
pondents. Thhese responddents in agggregate reprresent a statiistically acccurate
cross-secction of the U.S.
U adult poopulation (agge 18+)
ecast
Marketssizeandfore
Our U.S. pizza resttaurant markket size andd forecast iss segmentedd by sales at
a 1) full-seervice
restaurannts and 2) lim
mited-service eating placces. Our U.S
S. retail pizzza market sizze and foreccast is
segmenteed by sales of 1) frozenn pizza and 2) refrigeratted pizza (eaach at groceery/supermarrkets,
mass merrchandisers, drug stores,, supercenterrs, dollar stoores, club stoores and speccialty stores)).
Our U.S.. restaurant market
m
size and forecastt is based prrimarily on data
d from thhe U.S. Bureeau of
Economiic Analysis, National Inncome and Program
P
Acccounts; andd the U.S. Census.
C
Our U.S.
retail pizzza market size and foreecast is baseed in part onn data compiiled by the InfoScan
I
Reeview
service of
o Symphon
nyIRI, whichh tracks salles through U.S. superm
markets andd grocery sttores,
drugstorees and mass merchandissers (includiing Target and
a Kmart, but
b excludinng Walmart) with
annual saales of $2 miillion or morre.
Septemberr 2012
180
Pizza at Foo
R
App
pendix
Howeverr, in both casses, analysis is also inforrmed by dataa from otherr sources, inccluding:
U.S. Census Bureau,

U
B
Retaail Trade Suurveys
U Bureau of
U.S.
o Labor Staatistics, Conssumer Expennditure Survvey
T U.S Depaartment of Agriculture
The
A
T Bureau of
The
o Economic Analysis
T Internatio
The
onal Trade Centre
C
A
Analyst
interv
views
Inndustry partiicipant SEC filings
We also provide 201

11-2012 trennded retail pizza
p
sales analysis
a
at FDMx,
F
based on dollar sales
during thhe 52-week period
p
endinng July 8, 20012, as comppiled by thee InfoScan Review
R
serviice of
SymphonnyIRI, which
h tracks salees through U.S.
U supermaarkets and grrocery stores, drugstores and
mass merchandisers (including Target
T
and Kmart,
K
but excluding
e
W
Walmart)
withh annual salles of
$2 millioon or more. This analyysis is compprised of thrree segmentts: frozen piizza, refrigeerated
pizza, annd pizza prod
ducts, as welll as their resspective sub--segments.
Retailpizzzamanufaccturerandb
brandsales
Retail pizzza manufaccturer and brrand sales annalysis proviided in this report
r
is baseed on dollar sales
during thhe 52-week period
p
endinng July 8, 20012, as comppiled by thee InfoScan Review
R
serviice of
SymphonnyIRI, which
h tracks salees through U.S.
U supermaarkets and grrocery stores, drugstores and
mass merchandisers (including Target
T
and Kmart,
K
but excluding
e
W
Walmart)
withh annual salles of
$2 millioon or more. This analyysis is compprised of thrree segmentts: frozen piizza, refrigeerated
pizza, annd pizza prod
ducts, as welll as their resspective sub--segments.
Menuite
emtrendanalysis
Menu iteem trending data has beeen providedd by Datasseential, a leadding food reesearch comppany.
We incluude menu iteem trend anaalysis drawnn from its MenuTrends
M
product. MeenuTrends Direct
D
contains analysis of more
m
than 5,,500 chain annd independdent menus, weighted
w
to the U.S. Cennsus.
We also include limited-time offfer and new offer
o
menu item
i
analysiss from MenuuTrends Insidder.
Reportttableinterp
pretation
Many off the tables in
i this reporrt utilize a mixture
m
of inndexing, coloor coding annd trend linees, as
explainedd below.
Index
Many tabbles in this report
r
emplooy an indexing system. This
T way, ceell percentagges are convverted
to an inddex revealing
g measurablle differencees among daata points. The
T index reepresents inddexed
question agreement against the all averagge (100). Eaach integer above 100 correspondss to a
Septemberr 2012
181
Pizza at Foo
R
App
pendix
one-poinnt increase in
n percentagee likelihood of agreemeent in compaarison to alll average; each
integer below
b
100 co
orresponds to
t a one-poinnt decrease in
i percentagge likelihoodd of agreemeent in
comparisson to all average.
a
Color coode
Many taables in this report empploy a two--color (red and
a green) gradient color scheme.. The
maximum
m red gradieent representts the lowesst number inn the table; the
t maximum
m green graadient
representts the highesst number inn the table; and
a change in shade corrresponds to the value in each
cell. Thiss way, differrences in peercentage aggreement cann be identified accordingg to the shaade of
the colorr.
nes
Trend lin
Some off the tables in
i this reporrt include a trend line, located in thhe right-hannd column of
o the
table. Thhis line displays differences in percentage agreem
ment amongg column varriables in thee row
adjacent to it. This way, differrences in percentage agreement
a
foor a given response caan be
identifiedd according to
t direction (up or downn) of the trennd line.
Consum
merengagem
ment
In this report,
r
we frame
f
consuumer restaurrant and rettail brand usage
u
frequeency in term
ms of
engagem
ment: the mo
ore a consum
mer uses a particular brand,
b
the more
m
engageed the conssumer
becomes.
l
medium
m, and high.
In the folllowing anallysis, we identify frequenncy of visitss by degree: low,
Pizzarestaurants
f
distribution is as follows:
As applieed to pizza restaurants, frequency
Highly enngaged
Engaged
Any usse
= 6 or more vissits in the paast month

= 1+
1 visit in thhe past montth
= reports
r
simplly using thhe brand
Frozenpizza
As applieed to pizza restaurants, frequency
f
distribution is as follows:
Highly enngaged
Engaged
Any usse
= 5 or more uses in the passt month

= 1+
1 use in thee past monthh
= reports
r
simplly using thhe brand
Septemberr 2012
182
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R
App
pendix
Terms&
&definition
ns
Supermaarkets
Supermaarketsandotthergroceryy(exceptcon
nvenience)sstores
This induustry comprrises establiishments gennerally know
wn as superrmarkets annd grocery stores
s
primarilyy engaged in
n retailing a general linne of food, such as cannned and froozen foods; fresh
fruits andd vegetabless; and fresh and prepareed meats, fissh, and poulttry. Includedd in this inddustry
are delicaatessen-typee establishmeents primarilly engaged inn retailing a general linee of food.
Restauraantcategorie
es
We categgorize the restaurant induustry in the following
f
m
manner:
Full-service restaurants
r
(F
FSRs)
L
Limited-servi
ice restaurannts (LSRs)
Snack and beeverage restaaurants (or snnack and bevverage conccepts)
In this reeport, we furtther segmennt these categgories as folllows:
The full-serv
T
vice restauraant categoryy includes thhe Fine Dinning, Casuall and the Faamily
seegments.
The limited-sservice categgory also inncludes the Cafeteria/Bu

T
C
uffet and QS
SR segmentss (we
frrame the fastt casual restaaurant nichee within the QSR
Q segmennt).
nitions
Limitedsservicerestaaurantdefin
ngplaces
Limitedsserviceeatin
marily engagged in: (1) prroviding foood services where
w
This induustry compriises establishhments prim
patrons generally
g
ord
der or selectt items and pay
p before eating,
e
or (2)) selling a sppecialty snaack or
nonalcohholic beveraage for conssumption onn or near the
t premises. Food and drink maay be
consumed on the preemises, takeen out, or deelivered to cuustomers' loocation. Som
me establishm
ments
(except snack
s
and no
onalcoholic beverage baars) in this inndustry mayy provide theese food serrvices
in combination with selling alcohholic beverages.
Septemberr 2012
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pendix
LimitedSServiceRestaaurants
A subsett of limited-sservice eatinng places, thhis U.S. induustry compriises establishhments prim
marily
engaged in providing
g food servicces (except snack
s
and noonalcoholic beverage
b
barrs) where paatrons
generallyy order or select
s
items and pay beefore eating.. Food and drink may be consumeed on
premises, taken out,, or be delivvered to thee customerss location. Some
S
establlishments inn this
industry may providee these food services in combination
c
n with sellingg alcoholic beverages.
b
Quickservicerestaurants
Packagedd Facts deffines quick-service resstaurants ass establishm
ments primaarily engageed in
providingg food services (except snack and nonalcoholic
n
c beverage bars
b and bufffet/cafeteria--style
restaurannts) where paatrons generrally order or select item
ms and pay before
b
eatingg. Food and drink
may be consumed
c
on
n premises, taken
t
out, or be delivereed to the customers loccation, and drived
thru servvice is a com
mmon featuree. This grouup of restauraants is incluuded in limitted-service eating
e
places.
Fastcasu
ualrestauran
nts
Packagedd Facts defiines fast cassual restauraants as a niiche within the quick-sservice restaaurant
segment. The restau
urants typicaally have sliightly higheer guest check averagess than the quickq
service segment
s
gen
nerally, and have differrentiated theemselves froom their QS
SR precedennts by
blending QSR-style convenience
c
e and pricingg with casuall dining attriibutes. Fast casual
c
restauurants
led impoortant industtry trends, focusing
fo
on product fresshness, mennu healthfulnness, menu order
customizzation, enhan
nced ambiennce, and higgher service expectationns. Restaurannt brands thhat fit
this definnition includ
de Chipotle Mexican
M
Grill, Einstein Bros. Bagells and Panerra Bread, annd Pei
Wei Asiaan Diner. Th
his group of restaurants
r
is included inn limited-serrvice eating places.
Snackandbeverageestablishmeents
a beveragee brands as establishmeents primarilly engaged in 1)
Packagedd Facts defines snack and
preparingg and/or serv
ving a speciaalty snack, such
s
as ice crream, frozenn yogurt, coookies, or poppcorn
or 2) servving nonalco
oholic beverrages, such as
a coffee, juiices, or sodaas for consum
mption on orr near
the prem
mises. These establishmeents may caarry and selll a combinaation of snaack, nonalcooholic
beveragee, and other related prooducts (e.g., coffee beanns, mugs, coffee
c
makerrs) but geneerally
promote and sell a unique
u
snackk or nonalcohholic beveraage. This grooup of restauurants is inclluded
in limitedd-service eatting places.
Cafeteriaas,grillbuffe
ets,andbufffets
These esstablishmentts are primaarily engageed in prepaaring and seerving mealls for immeediate
consumpption using cafeteria-styl
c
le or buffet serving
s
equippment, suchh as steam taables, refrigeerated
areas, dissplay grills, and self-servvice nonalcooholic beveraage dispensiing equipmeent. Patrons select
s
Septemberr 2012
184
Pizza at Foo
R
App
pendix
from foood and drink items on display in a coontinuous caafeteria line or from bufffet stations. This
group of restaurants is
i included in
i limited-seervice eating places.
Fullservicerestauraantdefinitions
FullServiceRestauraants
This induustry group comprises establishmen
e
nts primarilyy engaged inn providing food servicces to
patrons who
w order an
nd are servedd while seateed (i.e., waitter/waitress service) andd pay after eaating.
Establishhments that provide
p
thesee types of foood services to patrons with
w any com
mbination of other
services, such as takeeout servicess, are classiffied in this inndustry.
Familydiiningrestaurrants
Packagedd Facts defin
nes family diining restaurrants as eitheer-full servicce restaurantts, which proovide
table service, or caffeteria/buffett-style restauurants, wherre customers serve foodd themselvees but
where taable service may be proovided for beverage
b
ordders and cheeck paymennt. Family dining
d
restaurannts typically do not servve alcoholicc beverages, and full-seervice variannts often proovide
specialized childrens menu item
ms. Average guest checkks generallyy fall betweeen those fouund at
quick-serrvice restaurrants and caasual dining restaurants. National brands
b
that fit
f this definnition
include full-service
f
establishmen
e
nts Bob Evanns, Cracker Barrel, Dennnys and Intternational House
H
of Pancaakes (IHOP)); and cafeteria/buffet-sstyle establisshments Goolden Corrall and Homeetown
Buffet. Among
A
indusstry participaants, these reestaurants arre also calledd family middscale restauurants
or midscaale restauran
nts.
Casualdiiningrestaurrants
nes casual dining
d
restauurants as resttaurants offeering a casuaal (as oppossed to
formal) atmosphere
a
and typicallyy serving allcoholic beverages, oftenn including an assortmeent of
beer, winne and spirrits. Averagee guest cheecks generallly fall betw
ween those found at faamily
restaurannts and fine dining
d
restauurants. Natioonal brands that
t fit this definition
d
incclude Chili's Grill
& Bar, Olive
O
Gardeen Italian Reestaurant, Applebee's
A
N
Neighborhood
d Grill & Bar,
B and Outtback
Steakhouuse.
ngrestauran
nts
Finedinin
nes fine diniing restaurannts as full-seervice restauurants with specific dedicated
meal couurses. Such restaurants feature highher quality materials annd decor, viisually appeealing
food portions, elevatted rules of etiquette, annd the wait staff is usuaally highly trained
t
and often
wears moore formal attire.
a
Fine-ddining restauurants are dominated
d
byy independeent operatorss and
small chaains.
Septemberr 2012
185
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App
pendix
Otherde
efinitions
Daypart
The speccific time of day, or meall. For exampple: breakfasst, lunch, dinnner, dessert and snackinng are
the daypaart breakdow
wns.
Guesttraaffic
Also knoown as foot--traffic, this term is usedd to describe the amounnt of people moving thrrough
the spacee of a busineess. Guest Traffic
T
is impportant to coonsider whenn examiningg the successs of a
business.. For examp
ple: revenue may be down in a bussiness, but if
i foot traffic is up, then the
problem of decreased
d check size can be conccluded.
Samesto
oresales
Same-stoore sales is a term whichh refers to thhe differentiaal in revenuee generated by
b a retail chhain's
existing outlets overr a certain period
p
of tim
me (often a fiscal quarrter or a parrticular shoppping
season), compared to
o an identicaal period in the
t past, usuually in the previous
p
yeaar. By compparing
sales dataa from existiing outlets (that is, by exxcluding new
w outlets), thhe comparison is like-to-like,
and avoidds comparin
ng data that are
a fundamenntally incom
mparable.
Septemberr 2012
186

The Pizza Market in The U.S.

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The Pizza Market in the U.S.

Copyright 2012 by Packaged Facts

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About the Author

The Pizza Market in the U.S.: Foodservice and Retail,

Vice President of Publishing

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Women are more lik

more froozen pizza th

Leverage vegetablee variety an

fat annd organic are

The conccept of com

on the goo, internation

The ACSI ran

Marrket Size and Fo

Marrket Size and Fo

Source: Packaged Facts, based in part on data from the U.S.

Marrket Size and Fo

Source: Packaged Facts, based in part on data from the U.S.

Marrket Size and Fo

Top 10 Pizza Chains

Source: Packaged Facts

Marrket Size and Fo

Source: Packaged Facts, based in part on data from Sym

Source: Packaged Facts, based in part on data from Sym

Marrket Size and Fo

Source: Packaged Facts,

Marrket Size and Fo

Pizza ( minus PL)

Private laabel now com

Marrket Size and Fo

Source: Packaged Facts,

Marrket Size and Fo

Source: Packaged Facts,

Marrket Size and Fo

Source: Packaged Facts,

Marrket Size and Fo

The Freschettta brand haas taken a new

The Dr. Oetk

Marrket Size and Fo

All frrozen pizza

Source: Packaged Facts, based on data frrom August 2012

Source: Packaged Facts, based

pizza, froozen pizza, fresh/refriger

As folloows, we analyze the results

With respect to the 17 fooods and foodd types we asked

a not relevvant to that to

thee same or less of the listed foods/food

Healthy food receives the highest positive diff

Source: Packaged Facts, based

Menu Trends & Retail New Pro

Menu Trends & Retail New Pro

Menu Trends & Retail New Pro

Source: Datasssential MenuTren

Menu Trends & Retail New Pro

Sourrce: Datassential MenuTrends Direct, used with permission;

Menu Trends & Retail New Pro

Roasted Red Pepper

Menu Trends & Retail New Pro

Menu Trends & Retail New Pro