Bake Up Sales for Pizza

Americans love pizza. According to a recent study conducted by Coppel, Texas-based CiCi’s Pizza, the average American will eat around 6,000 slices in his or her lifetime.

Yet, disappointingly for retailers, current pizza sales aren’t showing all of this love, according to “Pizza — US,” a June 2014 report from global market research firm Mintel. The report forecasts flat sales for pizza at retail between 2014 and 2019.

One reason for the growth slowdown is that many shoppers are turning to restaurants more often for pizza procurement. However, retailers will find pockets of growth and strategies for gaining more store brand pizza sales.

Offer better-for-you pies

As much as we love pizza, it’s not usually considered to be good for you, and for a good reason: Pizza is often filled with artificial ingredients plus excess fat and calories — a reality hurting pizza sales.

“Our analysis of consumption trends for 14 different foods/food types, including frozen pizza, suggests that pizza is losing ground to options that communicate the positive momentum of ‘real foods’ — such as fresh fruits/vegetables and home-cooked meals — and that it faces challenges related to its association with processed foods,” says David Morris, an analyst for the Packaged Facts division of Rockville, Md.-based MarketResearch.com.

Nevertheless, retailers could still get health-conscious shoppers into the frozen pizza aisle by offering store brand pizzas they feel better about eating.

“The ‘healthy halo’ and ‘better for you’ trends continue to be fast-growing in retail pizza” says Justin Ring, director of sales for Schaumburg, Ill.-based Nation Pizza and Foods.

The use of ingredients such as whole-grain or whole-wheat pizza dough and premium or fresh toppings and artisanal cheeses could have shoppers seeing store brand pizza as a higher-quality food even if it is still pizza.

“Store labels can continue to improve quality while simultaneously improving the health of pizzas. This is not to suggest store brands should go create completely healthy labels, but slowly eliminating artificial ingredients or slightly improving nutrition facts will resonate,” Ring says, adding that despite growing interest in healthier pizzas, sales for them represent only “a small fraction of the consumer market.”

The market could potentially get bigger, though.

“Among the 30 highest-growing brands and line extensions, generating more than $1 million in sales during 2014, 10 are closely associated with health and wellness, including Amy’s Light and Lean, Annie’s Homegrown and Bold Organics,” Morris notes. “Brands like these are a hot commodity.”

In terms of what labels to have on a better-for-you store brand pizza, according to Jimmy DeSisto, CEO of El Segundo, Calif.-based Venice Bakery, “non-GMO” is one of the most important.

“Non-GMO is the most significant trend for retailers to pursue since consumers are always reading labels, claims or descriptions on each product,” he says.

With the gluten-free trend continuing, “gluten-free-certified” is another trend worth pursuing.

“Retailers need to find a co-packer that understands the importance of meeting consumer needs and who is willing to work together as their partner,” DeSisto adds.

“No additives,” “no preservatives” and “all-natural” also are popular claims, according to Alessio Lucchese, sales director for Meduno, Italy-based Roncadin, who adds that it is “good to see retailers increasing their focus on both where food is coming from and the health effects on consumers.”

Variety counts

Despite the growing interest in more healthful pies and unique flavors, retailers need to make sure they don’t pay so much attention to trends that they forget the basics.

“As boring as it may be, people still like their cheese, pepperoni and sausage pizzas,” says Mike Pytlinski, brand director at Milwaukee-based Palermo’s Pizza, noting that based on sales, the top pizza toppings are cheese, multi-meat, pepperoni and supreme.

Instead of focusing largely on trends, “retailers need to think of the category as a pyramid,” advises Pytlinski, emphasizing that retailers need to have a strong foundation of store brand pizza offerings, including thin crust pizzas and rising crust pizzas, in both the mainstream and premium segments. Only once retailers have laid a strong product foundation in the pizza aisle should they start looking into the more trendy pizza products such as flatbreads.

“A lot of times retailers are chasing what they perceive to be the hot trend, and it is really the marginal opportunity,” he says.

But Ring says variety counts, too.

“Store labels that want to create loyalty and attract new customers to their store brand pizzas must ensure there is a significant presence on their shelf. There must be a wide array of store brand pizzas for consumers to choose from, as there are many different pizza consumers in the marketplace,” he says.

Variety means more than just frozen offerings, however. Two areas of the retail pizza market that are bright spots for private brands are refrigerated pizzas — aka “take-and-bake” pizzas — and kits. According to Packaged Facts, private label leads both of those areas with an 80 percent sales share. Whatever pizza products retailers choose for their store brands, though, the key consideration should be taste.

Retailers also could score with pizza in the prepared foods section. While consumers in the 18-to-34 age bracket are top users of pizza delivery, they also over-index in purchasing ready-to-eat pizza from retailers, presenting a sales opportunity. But according to Pytlinski, they are buying frozen varieties, too.

“They are inclined to shop the category,” he says. “They may spend on takeout, but on an everyday basis, they are looking for value.”

With many millennials interested in adventurous cuisine and ethnic flavors, ingredients beyond the traditional might help to catch these consumers’ attention. Plano, Texas-based Pizza Hut is an example of one pizza provider connecting with younger consumers through ingredients such as sriracha sauce, curry and pretzel crusts.

Promote your pizza

Having the right mix of store brand pizza products is critical, but marketing them can be just as important for retailers looking to grow store brand pizza sales. One effective means of marketing store brand pizza is pairing it with complementary products.

“Bundle it with other items in different categories such as soda, alcohol, wings and salads,” Ring suggests.

Promoting the store brand pizza side-by-side the leading brands can also be a sales driver.

“You have a price advantage, even when they are [on] sale,” Pytlinski says of store brands versus the competition. “Why not highlight that?”

But in the end, Pytlinski states, perhaps one of the best ways for retailers to sell store brand pizzas is to make sure the offerings fit the overall image the store represents to shoppers.

Do offer better-for-you store brand pizzas to appease health-conscious shoppers.

Don’t forget the basic — cheese, supreme, pepperoni and other classics sell well.

Do provide a variety of own-brand pizzas across tiers to satisfy all types of shoppers.

Don’t forget to pair store brand pizzas with complementary items.