May 5, 2015 | Customer Loyalty Research

Four PMQ Pizza Industry Stats, Interpreted

Divya Narayanan by  Divya Narayanan

Americans spend over $38 billion on pizza annually. No surprise: we’re obsessed with pizza. Here are four important pizza industry stats from PMQ (and what they mean for your pizza business).


1 - 2 - 3. In those three seconds, Americans ate 1,050 slices of pizza (mark me down for a slice). 1,050.  But are you surprised? Americans are obsessed with pizza.

At Thanx, we’re consumed by pizza. We’ve been thinking about pizza every day: how customers buy pizza, when they do, and, most importantly, what brings customers back. After countless hours of research, here are the four pizza industry stats we’ve found most noteworthy from PMQ's Pizza Power Report (interpreted for your business).

1. Enormous Opportunity, Intense Competition 

There are 73,097 Pizza Stores in the U.S. that made $38.5 billion sales in 2014 alone

Let’s put these numbers in perspective: 1 in 8 Americans eat pizza on any given day. Over a year, Americans spend almost $39 billion dollars on pizza - roughly equivalent to the 2014 GDP of Panama. That’s a lot of, ahem, dough.

At the same time, customers have countless options every time they decide where to have pizza (over 73 thousand shops across the U.S.!). Customers aren’t just choosing between price points, but crusts, styles, ingredients, and oven temperatures. And that’s just one piece of the pie: there are a total of 630K restaurants in the U.S. vying for dining-out dollars.

The reality is that the pizza market is mature and, shall we say, saturated. According to the CHD expert PMQ cites, sales have slowly grown at an average of just 1.2% annually since 2009. Customers are already eating pizza incredibly often and in huge quantities — they’re not going to start eating pizza more often. Every time a customer chooses pizza at one shop, they directly take a sale away from another restaurant.

Remember – this isn’t bad news! It just means that pizza marketers need to think outside the (delivery) box and innovate to entice customers to return. So, develop a competitive marketing strategy (yesterday) to (1) increase sales-per-unit and (2) make sure customers choose your brand — every time.

Better yet – here’s a comprehensive guide explaining exactly how to get started.

2. Chains Steal Share From Independents

Independent pizza restaurant market share dropped 10 points from 2009 to 2014

Any pizza connoisseur worth his salt will tell you the same thing: the pizza conversation has changed over the last decade. The choice has expanded from Pizza Hut or Domino’s to that deep-dish chain, or that independent neapolitan pizzeria downtown.

Wait a minute, is that really true? Let’s break down the numbers. The reality is that some independent pizza restaurants (fewer than 10 locations) struggled and shut doors during the crisis. Bigger players rose to the occasion, grabbing 10 points of market share. The upper-crust: Dominos, Little Caesars, Papa John’s, and Other Top Chains. Little Caesars and Papa John’s aggressively opened franchises and prospered with fast, fresh, and affordable pizza. Meanwhile, Domino’s had a 'turnaround', growing almost 8% last year, over 2x the national average.

Want to guess the common thread between the three very different chains? All brands executed purposeful, millennial-focused marketing campaigns to great success, embracing radical transparency and hassle-free digital experiences (more on that later).

3. Fast Casual Pizza Rises

55% of pizza customers buy fast casual pizza at least once a month

The talk of the pizza industry is fast casual pizza - the low-priced, high quality, customizable “Chipotle” of pizza. Business is booming as competitors like Blaze Pizza, PizzaRev, and Uncle Maddio’s race to open franchises. Last year, Pieology was the fastest growing chain in the U.S., growing a whopping 230%.  

With the fast-casual frenzy, pizza operators in every state are asking themselves, “do I try to beat fast casual pizza? or join?” While the answer to that question is intensely personal, the best, no-regrets strategy will always be to make changes that appeal to loyal customers. Oh, and offer delivery!

4. Mobile Matters

46% use mobile devices to look up restaurant location and directions

We are addicted to our smartphones. No surprise, nearly 90% of millennials keep their smartphones by their side, day and night. Today, customers of all ages increasingly rely on their phones to look up restaurant locations, menus, and order food online.

For today’s pizza restaurant, a mobile-optimized site and hassle-free mobile experiences are no longer an optional side, but the main course. Did we mention that mobile notifications have 50-80% engagement? That’s 29x more effective than email.

A Final Word

Here’s what we take away from these four important PMQ stats. Yes, growth-seeking pizza operators face challenges: the pizza industry is mature, and highly competitive.  But pizza is also incredibly lucrative. Marketers who develop a competitive strategy, execute millennial-focused marketing, and use mobile innovatively can stand out from the crowd. At the end of the day, we all win with more, delicious pizza to feed our obsession.

(p.s. pizza pun count = nine, did we deliver?) 

Free Download:  The Definitive Guide to Competitive Pizza Marketing


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