Marketing & the

Economy
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OVERVIEW
SITUATION
How to keep their customers
coming during recent difficult
economic times.

WHAT THEY DID

“$10 any” promotion
Revenue rose 6 to 7 percent in the
first quarter compared with the
same period a year ago, they said,
and rose about 10 percent in the
second quarter compared with the
second quarter of 2009 (Stuart
Elliot, 2010).
Everyday Low Prices
cut prices up to 50% from its
previous pricing
Most medium pizzas cost $8,
Most large pizzas cost $10 and
Most specialty pizzas cost $12.

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 1
What are the
implications of Pizza
Hut’s big price cuts
for its brand image?
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 BRAND IMAGE
◎ Isn’t exactly a fast food, and
also isn’t quite full-service fare.

◎Delivering average quality

products at an average price.

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Value Proposition
◎ “More for the same”
- giving more value than other similar
offerings of pizzas.

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Promotional rctino
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 New BRAND IMAGE
◎ Making good quality products
for a really cheap price.

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New Value
Proposition
◎ “Same for less”
- the same quality of products but at a
lower price than most of its competitors.

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 2
Can customer
loyalty be generated
through low prices?
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Ways to generate
customer loyalty
1. Make customer service a
priority
2. Quality of product
3. Product features
4. Low prices

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Brian Nicol
Chief Marketing Officer
Pizza Hut
“We want to make sure we can
provide people’s favorite foods
at accessible prices,”

“We want to build loyalty

beyond the price,”

“see the value in the brand

that goes beyond the price.”
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“We’ve changed just about
everything, except how your
favorite pizza tastes.”

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 3
Can Pizza Hut
sustain such
dramatically lower
prices and still
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 Pizza Hut cut prices to
counteract the slow
recovery of the economy
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In order to be
Profitable, it needs
1. More customers
2. Manage its cost efficiently

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 However, this new pricing mechanism that Pizza
Hut implemented,

as mentioned in the text, will require some time to

prove itself. rctino
References
Kotler, P., & Armstrong, G. (2012).
Principles of Marketing, Global Edition.
(14th Int. E. ed.). Boston: Pearson.

Elliot, S. (2010). Pizza Hut Cuts Prices

Again to Counteract the Slow Recovery.
The New York Times. Retrieved from
https://www.nytimes.com/2010/08/19/b
usiness/media/19adco.html