In the book "Professionalism", Kenichi Omae, the "father of Japanese strategy", pointed out that the competition between individuals, enterprises, and countries has crossed national borders, and the distinction between winners and losers has become clearer, and only experts with both professional skills and professional qualities can gain a firm foothold in the globalized economy and society.
As he said, all walks of life compete to the end, compared to the spirit of professionalism.
For example, in the watch industry, when mentioning Switzerland, everyone will immediately stand in awe, because people are professional; in terms of windbreakers and umbrellas, when it comes to the United Kingdom, people will immediately look up to three points, because people have professional bonuses; and sushi, everyone will think of Ono Jiro, because he is the "god of sushi", and has been focusing on sushi for more than 80 years.
If you're looking for "professionalism" in the pizza sector, Pizza Hut may be able to give you some inspiration.
Pizza Hut was born in 1958, and this year marks its 31st year in China. A brand that can stand up after decades of baptism is a story worth writing about, because in China's restaurant industry, the average closure rate is as high as 70%, and the average life expectancy of restaurants is only 508 days.
What is even more valuable is that even at such a stage of development, Pizza Hut still maintains its growth momentum. According to Yum China's second-quarter financial report, in the second quarter of 2021, excluding the impact of foreign currency conversion, Pizza Hut China's same-store sales increased by 11% compared with the same period last year, system sales increased by 16%, restaurant profit margin increased by 1.9 percentage points year-on-year to 13.1%, and operating profit doubled year-on-year.
Due to the ravages of the new crown epidemic, the catering industry has been affected, but Pizza Hut has been able to improve its performance for two consecutive quarters. And this is the return of "professionalism".
<h1 class="pgc-h-arrow-right" data-track="10" > the market of 100 billion pizzas and calls for professionalism</h1>
Since Pizza Hut opened its first branch in Chinese mainland in Dongzhimen, Beijing in 1990, pizza, a catering category, has experienced 31 years of development history in Chinese mainland.
Although with the continuous improvement of Chinese per capita disposable income and living standards, the pizza industry is growing into an industry with a market size of up to 100 billion, but the interior of the entire market has long been different.
On the demand side, under the increasing wave of consumption upgrading, consumers' requirements for food have long departed from the basic value of "delicious management and fullness", but have advanced towards challenging new tastes and expanding new maps of taste buds.
At the same time, with the explosion of information brought by the Internet and the "Internet natives" becoming the main force of consumption after 90, people's demand for the entire dining experience has also been iteratively upgraded: eating out is no longer just a meal, but a social gathering between friends and family, an experience activity that highlights personality and creates a unique memory, so it will be very concerned about the beauty of food, the popularity of the circle of friends, and the added value of the restaurant's store image, design style, value proposition, and low service.
In addition, the rise of the sinking market of 1 billion people has also promoted the cost performance and takeaway has become a new demand growth point in the pizza market.
In short, driven by the ever-changing market demand, pizza as a subdivision category has gradually faded the label of being once high-end, from a synonym for white-collar business meals of foreign companies and middle-class family dinners in large cities to a catering category with a high-end, high-level, low-level, and richer and more diverse taste.
On the supply side, a foreign pizza brand that entered China in the late 90s and early 2000s has gradually gained strength after gaining a foothold, coupled with the emergence of more and more Western restaurants, foreign forces have set off a fierce competition. At the same time, local pizza companies have also mushroomed, and enterprise investigation data shows that since 2015, more than 2,000 new pizza companies have been established in the Chinese mainland market every year, and 7869 new ones have been added in 2017.
The rise of foreign pizza companies and the influx of local pizza companies have brought not only blowout pizzerias, but also distinctive category innovations. For example, in recent years, durian pizza, crayfish pizza, etc. have been loved by more and more consumers.
It can be said that in recent years, the Chinese pizza market has become increasingly attractive to the eye.
But change is not far from its origins. Delicious and beautiful food, a pleasant dining process, and a valuable consumer experience are the eternal pursuit of food for new and old gourmets. Therefore, the more the market booms, the more the era of a hundred flowers blooms, the more it calls for professionalism that can deeply understand customer needs, keep up with market changes, and corporate strategies, products, services, and experiences.
<h1 class="pgc-h-arrow-right" Data-track="97" returns > "pizza expert": the power of professionalism</h1>
In the book "Professionalism", Kenichi Ohzen said that there are four abilities that a true professional must have: the ability to see, the ability to conceive, the ability to discuss, and the ability to adapt to contradictions.
Foresight: The ability to see beyond the immediate affairs and do the right thing at the right time. The cause that anyone can foresee will not develop again.
Conceptual ability: Not only to seize the opportunity, but also to have the ability to make the opportunity a reality with the fastest speed and the best way possible.
The ability to discuss: When companies can't see the path forward and the model of success, it is crucial to have a full discussion in theory.
Ability to adapt to contradictions: Management also contains contradictory things, so it is necessary to have the ability to think about problems from the perspective of the overall situation.
If translated into words in Chinese Simplified context, the above four abilities can actually correspond to each other: strategic forward-looking ability, layout ability, organizational communication ability and innovation and iteration ability.
As an external observer, it is difficult for the media to fully understand pizza hut's internal organizational communication work, but through the external changes in pizza hut products, brands, stores, etc., it can restore its strategic foresight, layout and innovation and iteration of its ability and performance.
Strategic card slot: innovation, localization, cost performance
In economics, $8,000 per capita GDP is a watershed. The experience of European and American countries proves that when a country's per capita GDP exceeds this value, it means that people's disposable income increases, their purchasing power increases, the scope of purchase increases, and the quality requirements for goods and services become higher. This is actually the consumption upgrade that Chinese familiar with.
Chinese average GDP roughly exceeded $8,000 in 2015. The media, capital and entrepreneurs must say that the consumption upgrade began 1-2 years before that.
But any commercial success can not be achieved overnight, those who can accurately grasp the market dividend, must be based on a sufficiently forward-looking judgment, timely strategic card slot, and do the right thing at the right time, otherwise when everyone realizes the consumption upgrade, and then adjust the strategy, it will fall into passivity.
As the pioneer of casual dining in the Chinese mainland market, Pizza Hut did not limit itself to pizza, but expanded its category to pasta, steaks, soups, salads, desserts and so on long ago.
Since 2008, due to the insight into the "new" needs of Chinese consumers for taste diversification and exploration of new taste buds, Pizza Hut has changed its menu twice a year, introducing at least 25% of the new products each time.
Pizza Hut's menu upgraded in March this year has as many as 40% of the new products, including grilled sea bass and steak platters, freshly grilled espresso cabata, tapas tapas, curry baked rice, spicy crayfish pasta and more. In the second quarter of this year, 5 new series and 13 hand-clapping pizzas were launched in one go.
Taking the 13 new hand-clapped pizzas launched in the second quarter of this year as an example, the first thing is to show the ingenuity of the pasta and show the style of "pizza experts". It selects wheat imported from North America and grinds it with its essence to make high-quality wheat core powder, and the wheat aroma is pure and rich.
At the same time, the exclusive recipe, low temperature sufficient fermentation, soft and chewy, the bottom of the cake is thinner, the filling is more sufficient, and on the spot, each cake base is made on the spot after ordering, which is delicious and healthy, and the safety and hygiene of the visible.
The 13 flavored pizzas include a new upgrade to classic flavors, as well as the combination of exclusive recipes and high-quality ingredients selected from all over the world, and there is no shortage of innovative products with explosive potential.
Among them, the chef's Portuguese curry series pizza, which is in line with the taste of Portuguese curry, is through dozens of spices and pure coconut milk to create a milky Portuguese curry, with fatty seafood, tender texture of filigree beef and tender and juicy chicken, coupled with a soft and chewy bottom, not only delicate taste, but also milky, mouth-watering; cheese pizza and durian pizza not only continue the return of classic taste, but also innovative upgrades.
As a foreign catering giant that has been in China for 31 years, Pizza Hut is also implementing a localization strategy and innovating products to meet the needs of different localized consumers, such as crayfish hot dry noodles launched for Wuhan diners, Xi leng steak Parmesan cheese knife cut noodles in Shanxi, etc.; for example, for customers who like spicy food, the launch of the fresh spicy series.
Innovative products, while accurately penetrating more and more subdivided taste consumers, have also further widened the moat of "pizza experts".
Because of the limited disposable income, the student body, young white-collar workers who have just entered the society and consumers in the sinking market pay much attention to the cost performance of the product when consuming pizza. However, many casual dining restaurants that provide pizza on the market, the per capita consumption is basically in the range of 80 to 150 yuan. Such prices have also led to many working-class, young white-collar and sinking market customers spending less frequently on Bisa.
In addition, with the increasing richness of pizza taste, the consumer population of pizza is increasing, which also promotes the entire pizza category into the era of popularization, and cost performance has become the key point of market competition. Pizza Hut adjusts the price of its products in a timely manner, continuously introduces cost-effective products, and has stuck in a favorable position in the popular pizza market.
For example, in the Pizza Hand Auction series pizza, more than 40 yuan to 60 yuan of price segment products have been added. Young and sinking consumers don't have to save as much money for a week as they used to, but are ready to enjoy Pizza Hut's delicious pizza at affordable prices.
This, in turn, will not only enable Pizza Hut to attract more mass consumers, but also continuously improve the repurchase rate of consumers, so that Pizza Hut can truly retain customers.
Layout: Upgrade experience and accelerate digital transformation
Whoever captures the young middle class, who occupies the market initiative, is the consensus of the entire consumer industry. So how to better plan the layout and truly occupy the consumption habits and minds of the young middle class?
The demand for the scene of catering consumption in this new middle class is mainly reflected in two aspects.
First of all, in addition to enjoying food, friends gathering, going out for leisure, punching in popular restaurants, celebrating holidays/birthdays, couples dating, not wanting to cook, etc. have become the mainstream scene needs of the current young middle class, which means that restaurants need to better fit young consumer groups in image design, service concept, and value proposition.
While some pizzerias are also actively improving the dining experience, they don't always do it perfectly.
As a "pizza expert" who has been a white-collar worker of foreign enterprises, a place for urban middle-class families to dine and a business meeting place since the beginning of his entry into China, Pizza Hut continues to improve the dining experience in stores.
On the one hand, the pace of store opening has been accelerated, and in the first half of this year alone, Pizza Hut has added 70 new stores, the highest number of net stores in the first half of 2016. Among them, there are a large number of satellite stores that have sunk to lower-tier cities and small shops that are "short and fast". Not only that, but the cash payback period of Pizza Hut's newly opened stores also maintains a healthy level.
On the other hand, we continue to renovate and renovate stores to bring consumers a fresh dining experience. Since 2018, Pizza Hut has refurbished more than 1,100 stores, nearly half of the total number of stores. Among them, the newly launched three design theme stores of "Star Chef Covenant", "Urban Encounter" and "Flower Escape" have become a large number of new middle-class and new Internet celebrity punch card holy places.
Secondly, in addition to the digital natives such as the post-90s and Generation Z, a large proportion of consumers have basically lived a digital life. Through mobile phone apps, they will find delicious restaurants, review stores worth punching, receive discounts, and share food punching experiences in the circle of friends. Therefore, digital construction has become whether the restaurant can seize the winner and loser of today's new middle class.
In recent years, Pizza Hut has comprehensively strengthened its digital layout and transformation with the goal of online business, user digitalization and operation digitalization.
On the one hand, we continue to improve the user experience through digital empowerment. Among the most representative projects are the Iketchen Smart Kitchen and the CIA Deep Customer Insight System. Ikitchen intelligent kitchen system can use algorithms to combine the order type at the front desk and the products ordered by customers, and automatically carry out dynamic scheduling management of kitchen production to ensure product quality and meal efficiency by considering factors such as real-time pressure in each store. The reason why the hand-patted cake base made on-the-spot can be eaten in a short period of time is to save customer waiting time and maintain delicious taste, and this system algorithm is the greatest contribution.
At a time when consumer tastes change so quickly, if you just follow, you can only be in a passive position, and insight into customer needs in advance is more able to retain customers. With the CIA customer depth insight system supported by big data and word cloud, Pizza Hut has the ability to accurately understand consumers, understand user voices and lead consumer demand through digitalization. That's why Pizza Hut's new products are always popular.
On the other hand, we will establish multi-matrix social touchpoints, including enterprise WeChat, WeChat public account and App, to provide members with richer rights and interests through digital interaction.
In addition to the social management of members through the enterprise WeChat, Pizza Hut also uses the AI engine to intelligently recommend member rights and interests through Platforms such as App and WeChat, including points as money to spend, Monday membership days, birthday gifts, discounts, etc., so that members can experience the benefits and benefits of members in an all-round way.
From both the offline physical store experience and the online digital experience, it can be seen that Pizza Hut has always kept pace with the times, fully adapted to the consumer needs of the new middle class, and successfully recognized by them.
Innovation and iteration: force new retail and takeaway
In the past, Pizza Hut was a scene of a middle-class family dinner or a white-collar business dinner. But now, the rise of "home culture" and "lazy culture", mobile payment is popular, and new retail and takeaway with online and offline as one have become a new battlefield that catering and retail enterprises are bound to win. If the flag is not planted in this new battlefield, it means that the entire consumption channel is incomplete.
In the new retail and takeaway tracks, Pizza Hut also added full horsepower and moved forward at full speed. In the core stores of Pizza Hut's first-tier cities where many office workers gather, online ordering and offline meal picking have become the collective choice of customers.
At the same time, Pizza Hut also conforms to the market development trend, launches take-away and takeaway, and launches new retail businesses such as fresh steak.
In the first half of 2021, Pizza Hut also received positive feedback on the above business innovations. Yum China's second quarterly report shows that in the second quarter, due to the popularity of scanning code ordering, Pizza Hut's takeaway revenue accounted for 35% of the overall sales. Pizza Hut's digital order rate reached 84%, an increase of 23 percentage points over the same period last year. The number of Pizza Hut members has reached nearly 100 million.
<h1 class="pgc-h-arrow-right" data-track="98" > the ever-changing casual dining market, what kind of "professionalism" is needed</h1>
Benefiting from more than half a century of consistent professionalism and more than a decade of reform, Pizza Hut has been able to record two consecutive quarters of rising performance under the background of the impact of the epidemic on the entire offline retail business and the decline in the performance of a large number of restaurant chain brands.
This is the return and victory of professionalism, the pattern and law that the consumer market should have, and it also points out the way forward for the evergreen foundation of various industries and major brands. Only professionalism can last.
Although pizza itself is not a new category, in the foreseeable future, the entire casual dining market will undoubtedly usher in a new change, and the test of Pizza Hut will only increase, not decrease.
First of all, China is a big country of food, and its food culture is broad and profound, with different styles and customs. This means that the combination of the entire casual catering category, including pizza, with local ingredients and flavors, still has endless imagination space.
Secondly, with the continuous improvement of the level of national income, the further penetration of urbanization, and the comprehensive rise of the sinking market population, the market size of the leisure and catering industry will inevitably usher in a longer development, especially the proportion of cost-effective products, new retail and takeaway in the entire industry will be further increased.
Third, when more and more post-95s, Generation Z, and even Alpha generation become the main consumer group, consumers will explore new tastes and new experiences in casual dining such as Bisa.
In addition, the intensification of consumption upgrading, the transformation of the Chinese people's lifestyle, the consumption period and consumer population of the entire leisure catering category will increase rapidly, and the market size will also usher in rapid growth.
All of this is both an opportunity and a challenge for casual dining brands. It is certain that the competition in the entire casual catering brand market will be further intensified, and the industry reshuffle will also accelerate.
In order to cope with the challenges of the future, Pizza Hut will continue to innovate in the future, such as continuing to focus on afternoon tea, supper and breakfast on the basis of existing lunches and dinners, and working hard in the direction of full-time restaurants to open a new business model; for example, it is constantly updating dishes, refining ingredients, iterating tastes, and accelerating the exploration of digital transformation, new retail and takeaway.
In short, Pizza Hut will never lie in the merit book to eat the old, but to consumer-centric, timely response, through the consistent and consistent professionalism, continue to provide more cost-effective exquisite casual meals and more comfortable catering experience, to meet the needs of consumers more diversified, more segmented.