Propelling Pizza Sales with Third-Party Platforms
Key Takeaways
Pizza merchants that invest in their presence on third party platforms, like Papa John’s, are seeing rapid growth.
Pizza Hut has lost share since the start of the pandemic, as many of their customers are buying from Papa John’s and Little Caesar’s on third party platforms.
Pizza Hut cedes share to competitors while Papa John’s grows
Relative Pizza Market Share
United States, Third Party and Direct, January 2020 - January 2022
Over the past 2 years, we’ve seen a shift in the dynamic between some of Pizza’s biggest national players. We’re seeing Pizza Hut lose significant share over 2021 while Papa John’s has gained momentum. Papa John’s focus on third-party marketing could have a role to play here, as we see a strong correlation between third party sales and overall growth. In January 2022, Papa John’s third-party sales were more than 3 times that of Pizza Hut’s.
Pizza Hut customers buy more often from competitors on third-party platforms
Pizza Hut Customers - 3P Pizza Wallet Share
United States, Third Party, January 2021 - January 2022
When Pizza Hut customers are shopping for pizza on third-party platforms, they are most often buying from Papa John’s or Little Caesar’s, even more so than Pizza Hut. Part of this is likely due to how Pizza Hut has approached third-party; not all of their stores are uniformly listed on third-party websites, unlike competitors like Papa John’s. Additionally, Domino’s doesn’t feature on this list as they have eschewed third party platforms in favor of their own direct channel, but it's not uncommon for Pizza Hut customers to buy directly from Domino’s as well.
Merchants like Papa John’s, who have been particularly active on third-party platforms may have an early mover advantage that will be hard to overcome. It’s clear that the old days of calling for pizza are starting to shift, as customers are becoming increasingly comfortable ordering their pizza through third-party platforms like DoorDash, Uber Eats, and Grubhub. It will be interesting to see how this dynamic change will affect the strategy of some of the QSR (Quick Service Restaurant) pizza players moving forward.
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