Subway is to sandwiches what Dunkin’ is to doughnuts. So why are both chains exploring — pizza?
It’s because fast foodies find it tough to resist sticking a gooey finger in the $28.5 billion pizza industry at a time when the pie biggies — Pizza Hut, Domino’s and Papa John’s — have seen growth stall.
More than a decade ago, even McDonald’s tested pizza before tossing in the apron. But with consumer interest in pizza high and pizza-dominated chains’ sales lagging, the temptation to roll out the dough is once again peaking.
Of all meals eaten at restaurants, 9 percent now include pizza, reports NPD Group. “The demographic of pizza eaters is about the same as oxygen breathers,” says Steve Green, publisher of PMQ’s Pizza Magazine, a trade publication.
Recent pizza growth has been in artisan, take-n’-bake and rising-crust pizzas, Green says. Now, Subway and Dunkin’ think faster, smaller pizzas may find a niche.
Subway is dishing out personal-size pizzas at about half its stores nationally, and Dunkin’ Donuts is testing personal pizzas at 15 prototype stores in six states.
“Everyone in the industry is keeping an eye on the new entries,” says Mandy Detwiler, managing editor at Pizza Today.
Particularly the “Big Three.”
• Domino’s: “We pay attention when formidable brands want to enter our sandbox,” says spokesman Tim McIntyre.
• Papa John’s: While folks may grab a mini-pizza at lunch, “They will continue to look to Papa John’s to feed their families at dinner,” says spokesman Chris Sternberg.
• Pizza Hut: “Imitation is the sincerest form of flattery,” says Bill Ogle, chief marketing officer.
So far, Subway and Dunkin’ have been low-key about pizza plans.
Since summer, Subway has sold pizza at nearly 13,000 of its 21,136 U.S. locations. It wants more but is not requiring franchisees to do it, says spokesman Les Winograd.
Subway’s $2.99 thick-crust pizzas arrive frozen. They’re defrosted, then baked in the toaster ovens in about 90 seconds. Meat toppings are a buck each. Veggies are free.
Winograd won’t discuss sales but says franchisee feedback “has been positive.”
Dunkin’, too, is coy about plans.
The test began late last year in a handful of units and is now in 15 stores. The made-to-order pizzas, at $2.49 to $2.99, are oven-cooked in about three minutes.
The chains are likely serving pizza to build up dinner business — when consumers prefer hot meals, says Sherri Daye Scott, editor of QSR magazine, a trade publication.
Dunkin’, however, is even serving pizza for breakfast. Customers and franchisee response will determine “if and when the pizzas are launched in all of our restaurants,” says spokeswoman Margie Myers.
Experts aren’t sure about the idea. “I don’t quite get the idea of going to a doughnut shop to get a pizza,” says restaurant consultant Ron Paul. “Why would I do that?”
