Kids that grew up in the '70s and '80s remember Yum Brands' (YUM) Pizza Hut for its cozy booths with red faux leather seats, the seemingly endless salad bar, those amazing arcade machines, and of course, its delicious pan pizza.
While the Hut has changed to keep up with the times and most of those retro delights are gone, the nostalgia remains, keeping the chain alive for 64 years and counting.
The pizza market is a very different place than it was when Pizza Hut first opened its doors back in the late '50s. With competition from Domino's (DPZ), Papa John's (PZZA), and Little Caesars (not to mention all the non-chain pizza joints all over the world), the chain has to think competitively in order to keep people interested.
While still serving up its staple pizzas, Pizza Hut has continued to try to innovate with inventions like the Italian Taco. It also introduced Oven Baked Pastas and Hershey's desserts earlier this year. And now it has something new that ought to appeal to those with a soft spot for calzones.
What's New At Pizza Hut?
Chewboom reports that Pizza Hut's newest product is called Melts and, at a glance, looks like a really big slice that someone folded in half.
Melts launch on Oct. 18 and will retail for $6.99. These cheesy delights are available in four varieties: a Pepperoni Lover's served with marinara for dipping, a Buffalo Chicken that comes with both buffalo and ranch to dip, a Chicken Bacon Parmesan that also comes with ranch, and a Meat Lover's that comes with marinara.
Pizza Hut/TS
Pizza Hut's whole push on the Melts is that they're ideal for people eating solo who don't want to order an entire pizza. And while there's never been a single thing wrong with doing that, because leftover pizza is always a delight, there's a clever angle to the promotion: offering a cheaper option during a time when inflation fears are high.
To promote Melts, the Hut has a contest going as well where 250 entrants have a chance to win $100 each. The company invites people to visit its new website meltsarenotforsharing.com and sign an "MDA" (Melts Disclosure Agreement" to agree that people will not share images of the new melts with friends or on social media. This contest is limited to U.S. participants and runs through Oct. 31, 2022.
Operational Challenges for Pizza Hut
Things have been good for Yum Brands on the whole as of late, but Pizza Hut's U.S. market is in need of a boost. David Gibbs, Yum Brands chief executive officer, addressed the challenges the brand is facing during the company's Q2 earnings call on Aug. 3.
"At Pizza Hut U.S., which represents 7% of our operating profit, system sales declined 3%, driven by flat unit growth and a 4% decline in same-store sales, driven in large part by continued operational challenges in our delivery business," he said.
To address the problem, Yum adopted the use of third party delivery-as-a-service options to supplement its delivery workforce, which now is functioning in 55% of its locations.
