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2019 Pizza Power Report

To stay competitive in the pizza business in 2019, independents will have to meet customers’ growing demand for speed, customization, delivery and convenience.

Some Key points from the 2019 Pizza Industry Report:

-To stay competitive in the pizza business in 2019, independents will have to meet customers’ growing demand for speed, customization, delivery and convenience.

-Consumers are increasingly insisting on the freshest, healthiest ingredients, a trend driven largely by younger segments of consumers, who also demand the highest technology available to facilitate ease of ordering and delivery.

-Domino’s now commands a price of $266. In that article, Kelly Garcia, Domino’s SVP of e-commerce development and emerging technologies, states that execs had to start thinking of themselves as heading up an “e-commerce company that happens to sell pizza.” Kelly says that Domino’s success is due to two critical factors—fundamentals and “surprise and delight.” Domino’s correctly identified that the industry was moving to mobile, which contributed to half of their digital sales, while digital sales now make up the majority of overall sales.

-A full 43% of pizza customers say they find online ordering and tracking technologies “appealing or extremely appealing,” according to a Technomic study, while the same study found that 24% of consumers felt similarly about pizzas that can be ordered from a smart TV.

-A November 2018 study by eMarketer Retail found that 36% of U.S. internet users ordered restaurant delivery in the past year, the majority of which were those under 35. The survey found that younger users have higher adoption rates and tend to use delivery services more frequently. Irving notes that younger pizza consumers want online ordering, as well as information on your ingredients. “You have to recognize that and adapt your business,” he says. “If you don’t change now, it might not affect your business today, but five years from now, you’re going to look back and say, ‘I wish I had online ordering then, because now everybody else has it.’”

Topliff echoes the demands of those who prefer to do things right from their computer or phone for ease and convenience. But she also identifies an unexpected upside to online ordering: privacy. “There is a tendency to order more online, because no one is watching what you’re ordering,” she explains. “You have the ability to order in the privacy of your own home and by yourself. But some people still prefer to order in person, so you have to be prepared to go in any direction that is going to be most convenient and make your customers the happiest.”

-Third-party delivery and ordering services have been game-changers in the pizza industry. For the first time, restaurateurs have the option of not hiring drivers and paying costly insurance bills for the luxury of delivering their product. However, these services come at their own cost.

A June 2018 Morning Consult poll reported that “31% of U.S. adults order delivery at least somewhat often, and 67% ‘hardly ever’ or ‘never’ order in.” The study also indicated that 82% said they prefer to order directly from a restaurant, while only 13% utilize a third-party delivery service; 26% stated “quality of the food delivered” was the deciding factor in choosing a third-party delivery service. According to PMQ’s 2018 Pizza Industry Census, 67.46% of respondents reported not utilizing a third-party delivery service.

-“There have been recessions, but pizza always seems to do well even during those times, because we’re the one food that families can depend on—that can feed a family for a fairly decent price, that helps celebrate football games and birthdays and kids’ parties.

-And, if there’s one more trend that doesn’t look to be slowing, it’s the increased focus on technology. Looking ahead to 2019, remain on the lookout for new innovations, whether it’s a new ordering app, a piece of equipment that can lower your labor costs, or an upgraded POS system. History shows that those who fail to adopt new technologies may be left behind, especially given the youth market’s affinity for all things high-tech.

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