Marketing Strategy Report: Pizza Hut, Consumer Behavior and Strategy

This report provides a comprehensive analysis of Pizza Hut's marketing strategy, examining various aspects of its operations and consumer behavior. The report begins with an executive summary and an introduction to Pizza Hut, detailing its history and global presence. It then delves into market segmentation, including geographic, demographic, psychographic, and behavioral segmentation, to understand Pizza Hut's target market. A market analysis of the New Zealand restaurant market is conducted, considering factors such as location, age, social class, and education. The report also explores promotional strategies, advertisement techniques, and market trends. It analyzes consumer buying habits, identifying internal factors such as perception, attitude, personal needs, and motives, as well as external factors like culture, social class, and reference groups. The report further discusses Pizza Hut's marketing strategies, including place, distribution, promotion, product lifecycle, and pricing. It concludes with an ethical communication slogan and a summary of the findings.

Running head: MARKETING STRATEGY
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Marketing strategy
Institution
Student name
Date

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Executive summary
Success in business is a reflection of the marketing strategy the management installs. Proper
marketing strategy increases the rate of reach to the potential customers hence increasing the
volume of sale thus generating higher profit. This article is a report on the analysis of buyer’s
decision making and the associated factors influencing buying habit. The report also analyzes the
behavior of the potential customer in response to internal and external factors affecting the
market. Lastly, the report describes the design and proposal of ethical marketing communication
strategies and tactics in business.
Table of Contents

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Executive summary.....................................................................................................................................2
Introduction.................................................................................................................................................5
Market segmentation..................................................................................................................................5
Geographic segmentation.......................................................................................................................6
Demographic segmentation....................................................................................................................6
Psychographic segmentation...................................................................................................................6
Behavioral segmentation.........................................................................................................................7
Market positioning and target.....................................................................................................................7
New Zealand restaurant market analysis....................................................................................................7
Location...................................................................................................................................................7
Age..........................................................................................................................................................8
Social class...............................................................................................................................................8
Education factor......................................................................................................................................8
Promotion................................................................................................................................................9
Advertisement.........................................................................................................................................9
Positioning graph.....................................................................................................................................9
Market trend...........................................................................................................................................9
Competition...........................................................................................................................................10
Influences of consumers buying habit.......................................................................................................10
Internal factors affecting customer’s decision.......................................................................................10
Perception and attitude.....................................................................................................................10
Personal needs and personality.........................................................................................................11
Motive...............................................................................................................................................11
Taste..................................................................................................................................................11
External factors......................................................................................................................................12
Culture...............................................................................................................................................12
Social class.........................................................................................................................................12
Learning and reference groups..........................................................................................................12
Marketing strategy....................................................................................................................................13
Place......................................................................................................................................................13
Distribution........................................................................................................................................13

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Wholesale and retail mechanism.......................................................................................................13
Promotion..............................................................................................................................................14
Advertisement.......................................................................................................................................14
Product......................................................................................................................................................14
Product lifecycle....................................................................................................................................14
Pricing........................................................................................................................................................15
Premium pricing....................................................................................................................................15
Profit margin..........................................................................................................................................15
Penetration pricing................................................................................................................................15
Ethical communication slogan...................................................................................................................16
Target market........................................................................................................................................16
Conclusion.................................................................................................................................................17
References.................................................................................................................................................18

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Introduction
Pizza Hut fast food store in Kansas in 1958 is the first establishment of this organization. The
organization underwent franchising a year later and established 12000 other stores in more than
80 countries. Today, the organization has about 40,000 branches in 125 countries. In Australia
Pizza Hut have a hundred and twenty-five well established and organized restaurant’s branches.
The restaurant offers customer services like delivery to customers upon placing an order. The
restaurants have a variety of customers who are of diverse backgrounds, social class, age, and
religions. The fact that food is a basic need and the urge for food can’t get postponed increases
the number of customers attending the restaurant. The branches established in many countries
increases the volume of the potential customers the restaurant can meet hence increasing the
number of sales; hence the profit and efficiency in conducting the organization’s management
works (Kimes, 2017).
In New Zealand, the market size of Pizza Hut is significant in terms of the number of customers
accounting to its many investments across the state. Being a food industry, the flow of customers
seems to be consistent in search of food satisfaction. The market has a large number of raw
products suppliers. The competitors in the industry exist in large number therefore only the most
efficient restaurant in service delivery thrives well in the market.
Market segmentation
Pizza Hut market comprise of the general population of the land. The need for the basic need of
food cut across the community and hence the demand. The restaurants have facilities for children
games; hence the children are also part of the targeted customers. At the evening the restaurants
offer movies session targeting the movie lovers as part of the market. The market has no

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distinction in terms of gender classification, age, and social class. The following are some of the
market segmentation used by Pizza Hut.
Geographic segmentation
Pizza Hut has branches in the towns and the areas of high population. The high number of people
living in these areas provides an environment productive with potential customers. The location
in the cities is conducive and enables Pizza Hut to remain competitive through all the seasons of
winter and summer.
Demographic segmentation
Pizza Hut demographic segmentation lacks a formal specification of the particular group of
people as the primary market. Both the low income and high income generating individuals have
their place in the organization, and the sum pay determines the services level. Aged people have
a preference for a diet that differs from that of the young people. The organization offers
foodstuffs suitable for the population of all ages. The fact that most of the members of any
community have are educated; there is no distinction in the services offered on the grounds of
education level (Khan, Yusuf, Hakeem, & Naumov, 2018).
Psychographic segmentation
The branches of Pizza Hut are located in different geographical across the world where
individuals have different beliefs, values and personality traits. To this reason, the foodstuffs and
services offered in the various branches are determined to suit these requirements. These factors
determine the products and services provided at different branches; hence all branches don’t
provide uniform products.

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Behavioral segmentation
People of different places have different behaviors and ways of life hence affecting what they
need to satisfy their needs. Pizza Hut considers this aspect and changes the products and the
services offered with the change in people’s behavior to suit their needs.
Market positioning and target
Customers of Pizza Hut restaurant have the conviction that the services offered by the
organization are the most efficient and affordable. The restaurant position in the market has
happened by the fact of providing quality food and services at an affordable price. The services
of the restaurant are provided on individual requirement basis as opposed to the assumption of
the competitors that; the market is uniform (Litvin, & Romo, 2018).
New Zealand restaurant market analysis
In New Zealand, the population of the state members provides an adequate market for food,
beverages and restaurant services. The customers for restaurant services can be categorized as
follows:
Location
The highest number of customers to restaurants in New Zealand constitutes a significant number
of people living in towns and cities. The restaurants also have a commendable size of customers
from overseas when they are on tour of the state. The availability of conference halls in the
restaurant also gathers customers from a distant location. The changes in seasons also draw in
customers from both rural and urban areas as they aspire to spend the given season in the
restaurants.

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Age
The restaurants in New Zealand accommodate people from all age groups. The provision of
children games facilitates accommodation of children in their services. However the middle-aged
and the aged population forms the highest constitution of the customers as they tour and have
fun.
Social class
Restaurants customers are mainly the people of the middle class and those of high social class.
These people have enough to sponsor and pay the bills for fun. The people of the low social class
lack the financial ability to pay for the exponentially high prices of the services offered.
Education factor
Majority of the less educated population forms the highest percentage of the people in the low
social-class. They, therefore, cannot raise the cost of the bills and prefer eating at their homes.
The educated people tend to conduct meetings in the restaurants hence constituting of the
customers. Educated people also have a deep awareness of the existence of a variety of food
products thus flowing to restaurants in numbers .The restaurant targets customers at the
individual level without a cutline or specification of the people it will give the service to.
However, the restaurants have conference halls that enable it to reach groups of customers as
they hold meetings in their conference halls. The restaurants have facilities for children games
and swimming pools. The prior allows the market to the restaurant to target the children as
customers to the restaurant. The swimming pool targets the population seeking for fun during the
holidays and the weekends. The following are the major market positioning approaches:

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Promotion
Pizza Hut has a routine of giving gifts to the customers who are identified to be loyal to the
restaurant. The loyal customers get a discount on the total purchases and other awards like the
umbrellas, t-shirts and hand band printed with the Pizza Hut logo (Goryushkina, Shkurkin,
Petrenko, Demin, & Yarovaya, 2016). The customers henceforth acquire a feeling of belonging
and thus paying more visits and in the company of the friends and family increasing the number
of sales.
Advertisement
The organization adopts to various mode of advertisement both the print media as well as the
audio and audial, visual products publications. Only in rare cases a week will go without the
organization airing an advert in the newspaper radio or the TV. The advertisement works well
along with digital push and pulls strategy of using blogs and social networks aiming at creating
awareness of the product to the people who did not know of its existence and reminding those
who knew of the product existence. The strategy helps the organization to draw customers hence
increasing the volume of sales (González, & Gidumal, 2016).
Positioning graph
The consumers have different perceptions of the product especially when the issue of the cost is
put on the board. The organizations have made all the efforts necessary to sensitive the
customers on the effectiveness of their services hence unifying the satisfaction of the customers.
Market trend
Restaurant market has been changing over time. Initially, people visited the restaurant to meet
their demand for food, in the current state, people view a restaurant as a place for rest, food, and
entertainment. To this understanding Pizza Hut has fitted its branches with entertainment

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elements like the movies and swimming pool as a mechanism of ensuring the organization
remains relevant in the industry.
Competition
Every industry is a competitive arena. Pizza Hut has the desire and the urge to remain in the top
of the market. The organization evaluates the competitor's means of production mechanisms and
services and adopts the efficient method of operations to counter the undying competition in the
market.
Influences of consumers buying habit
The decision of a consumer to buy a product or a service from a given supplier has to pass
through a thorough evaluation of various factors. For efficiency, the supplier must be ready and
vibrant in the assessment of the factors affecting the decision of the consumer to buy the product
he offers. Failure to evaluate the factors affecting consumer decision making to buy a product is
likely to lead to a situation where the supplier provides what he thinks is competitive in the
market whereas it is not as per the customers stands. The factors affecting this process of
decision making has internal and external factors (Pelsmacker, Tilburg, & Holthof, 2018). The
decision of the consumer is determined by the consumer's perception of the consumer to the
product, organization and the services offered.
Internal factors affecting customer’s decision
Internal factors are the personal factors that influence an individual to buy a given product.
Perception and attitude
Perception and attitude is the individual’s feeling and thoughts about something. Research claim
once an individual’s habit gets formed, it is tough to change it. If a customer has a negative

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attitude is negative, changing it is difficult and almost impossible. The negative attitude of the
customers affects the volume of sales of the organization negatively.
Positive attitude, on the other hand, makes the customer call infrequently even when the similar
services are readily available from the competitors. The positive attitude of the customers attracts
a high volume of sales hence the profits. The attitude of the customers helps Pizza Hut to
evaluate how well the organization is established in the market (Han, & Hyun, 2018).
Personal needs and personality
Taste, motives and personal needs are the most substantial factors influencing the buying
decision of a customer. The customer need is the lack of something the customer need if the
customer needs something available in the market is likely to create an urge and decision to buy
the product. If the customers have a view of product inability to satisfy his wants, he has high
chances of deciding not to buy the product. If the products have the possibility of fulfilling his
wants, the chances of deciding to buy the product are high.
Motive
The motive is the desire of an individual to satisfy a given need. When a potential customer has a
strong and enough encouragement to but a given product then he will go for it, and if the urge is
not competitive in the list of other needs, the potential customer is likely to postpone satisfying it
and thus affecting the volume of sales recorded by the Pizza Hut (Yang, 2015).
Taste
Variant people have different taste and preference for products. When a customer develops a
taste and preference to a given product, it becomes habitual thus increasing the volume of sales
made by the organization. On the other hand, if people develop taste and preference for the
product offered by the competitor, the organization will record low sales over time.

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External factors
The decision to buy some products is likely to be determined by the ways of life of a given group
of people. The factors include; culture, social class, and reference groups.
Culture
Different communities have behaviors and products whose use is taboo. This collectively affects
the decision of the individual to buy a given product. For instance, the decision to offer bacon as
part of the fast food offered in Muslim dominated land should be relooked at. However, some
cultures encourage the use of a given product. This difference in cultures affects the decision to
buy a given product; hence the volume of sales made. Cultures that encourage the use of a given
product positively affect the decision to buy the product thus increasing the volume of sales
made.
Social class
The decision to buy a given product is affected by the social class of the customers. Customers of
a higher social class are likely to go for expensive products, hence increasing the volume of sales
made on costly products. On the other hand, people of the low class are expected to decide to
buy low-cost products in the account of their buying power. However, these criteria don’t apply
all products. For instance, the decision to purchase salt is likely not to be affected by the social
class of the society.
Learning and reference groups
In every community, there exists a group of individuals of high influence that significantly
affects the decision to buy or not to buy a given product. These groups’ plays a role in the
learning points of the attitude, beliefs and the behavior associated with a particular product.
When these groups react in favor of the product in question, it will record high sales, and if on

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the other hand, the influence to buy the product is negative, the organization offering the product
will record low sales volume.
Marketing strategy
Marketing strategy is defined as the general game of reaching out a population and making its
fraction of your customers. The approach has four main building blocks, that is; place,
promotion, product, and price (Rahimi, & Kozak, 2017).
Place
The place is a marketing strategy meant to increase the rate at which the customers view the
product. The assumption of these criteria suggests that, if the customer sees a product several
times in duration, it is likely to persuade the customers to buy the product. For instance, if the
customer visits a showroom and sees a product several times, he is expected to purchase the
product.
Distribution
Distributing the product to several different places increases the number of people who creates
contact with the product as compared to when the goods are sold at the point of production.
Meeting potential customers persuades them to buy thus increasing the number of sales.
When a product is only sold at the point of production, only the population around the end of
production has an awareness of the existence of the product. On its distribution to various places,
the community aware of the product increases hence increasing the number of potential buyers.
Wholesale and retail mechanism
Pizza Hut offers the product in divided small quantities to ensure that people of low incomes can
afford the product from the retailer at the affordable supply.

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Promotion
Pizza Hut has employed a strong promotion marketing strategy by creating awareness of the
existence of the product. The management conducts promotion events like the road shows to
sensitize the population on the existence of the product.
Advertisement
Pizza Hut has a strong advertisement strategy using the media and the billboards. The
management ensures consistency in publication aiming at attaining a higher number of customers
frequently. The radio, television, the newspaper and the use of billboards are the most used
media of advertisement. Advertisement creates awareness to the population hence increasing the
number of buyers. Advertisement is one of the most used promotion strategies due to its
effectiveness. Advertisers manipulate the advertisement and make it look like an entertaining
article hence making them more attractive and popular. They are also able to meet a large
number of people on the go hence economical and reliable.
Product
Product is market driven in the industry; however, offering the best product in the market is not
an assurance of making the most sales if the customers are not aware of its existence. The
business should strive to make the population aware of the product (Guillet, Kucukusta, & Liu,
2016).
Product lifecycle
Product lifecycle is defined in four stages, the introduction stage, growth stage, maturity and
decline stage.

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Introduction stage happens to be the toughest in the industry in terms of cost and effort. At this
stage, the management struggles to introduce the product in the market sensitizing people on the
cost-effective and all other advantages accrued to the use of the product in comparison of the
existing products (Dwivedi, Kapoor, & Chen, 2015).
The growth stage is the second stage of the product lifecycle. At this stage, the customers are
aware of the existence of the product, and the numbers of sales are exponentially growing.
The maturity stage is the stage where the product is well established in the industry, and it is
capable of competing fairly in the industry. At this stage, promotion becomes less effective as
compared to the modification of the product. The market is already saturated, and competition is
likely to be stiff as other firms in the industry adopt your production method.
Pricing
Premium pricing
The management uses this strategy to introduce the product at a higher price to create a
perception in the market that, the price must be of high value. Lowering the cost later attract a
high volume of customers thus increasing the size of sales hence profit (To, Martin & Billy,
2015).
Profit margin
The management uses the cost of producing the product to calculate the value at which the
product sales. This minimizes the chances of making losses or customers exploitation.
Penetration pricing
In this criterion, the management introduces the product at a low price and increases it gradually.
The initial low price attracts customers who eventually become loyal and can’t stop being

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customers after the costs have been raised (Ekpo, Riley, Thomas, Yvaire, Gerri, & Muñoz,
2015). Market penetration is effective where the customers have fear on the effectiveness of the
product and fear to spend on what can’t satisfy their wants. The first few customers who are
lucky to buy the product at the low price acts as the brand ambassador spreading the
effectiveness of the product and the low price its offered on. When the price is increased,
customers have less consideration on the price, but the effectiveness hence rushes to buy the
product before a further increase in the price of the product.
Ethical communication slogan
The organization slogan “strong like a lion, you are what you eat” creates a sensation to the
public that the organization offers the best food hence countering the market competition. Slogan
acts as the brand of the organization. it should be strong and easy to remember for effectiveness.
Target market
The slogan will attract anybody to the restaurant with the perception, after eating in the
restaurant, the person will become stiff. Restaurants target market usually is the general public,
people of all social classes, age, gender, and race. The argument behind this fact is that both the
rich and the poor can’t postpone the need for food. Also, children get hungry in the same manner
their adult's counterparts do. Neither is anyone hunger proof one the basis of gender, or race,
both the black, white and reds have the desire to eat when the need arises. Likely food industry is
one of its type and customers are the general members of the community aware of the products
offered and are willing and able to buy them.

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Conclusion
Introducing a new product in the market or promoting the existing one is the most critical thing
in the counter of competition. Establishing stable placement, pricing, promotion, and the product
is an assurance of success and fair combat of competition in the industry. The growth of an
organization has a direct and proportional relationship to the efforts and input deployed to the
most effective marketing strategy of the organization. Establishing a business is important but
creating the customer's awareness on what the organization deals with and the effectiveness of
the product offered is vital. Marketing is the step a business should take to attract customers. In
some cases, marketing before launching the product is recommended. The mechanism is
effective as the customers will have the attraction to know what the benefits of the product are.
Study of buying habits of customer’s claims customers always wants to be the first to taste the
product, making this marketing strategy more effective.

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