Building Better Pizza Melanie Zanoza Bartelme | November 2016, Volume 70, No.11

To appeal to today’s informed consumer, pizza makers are drawing on global inspiration to create uniquely flavored, high-quality pizzas with a better-for-you twist.

Building a Pizza
Who doesn’t like pizza? Americans consume 350 slices every second, according to CNBC, and a recent Harris Poll found that 15% of Americans deem it their top comfort food. Pizza is equal parts convenience and indulgence, and it’s appropriate for easy weeknight meals and special celebrations alike. “People have a lot of joy around pizza,” says Kendall Bruns, creator of the Chicago-based U.S. Pizza Museum, which collects and presents memorabilia related to the cheesy dish.

Pizza “is ideally suited for nearly universal appeal,” writes Euromonitor. Depending on an individual’s likes, nearly everything about pizza can be modified to fit his or her desires, from the shape and style of its crust to the sauce that’s slathered on top to the plethora of meats, veggies, and cheese that crown it. While there’s no chance that pizza’s going anywhere, it does face competition from healthy alternatives and other convenient offerings. To ensure that sales remain strong, more and more companies are experimenting with crusts, sauces, and toppings to provide consumers with exciting, innovative, and delicious offerings.

Pizza at Home
Dollar sales for frozen pizza sold in mainstream retail channels reached nearly $4.7 billion, according to IRI data for the 52-week period ending Aug. 7, 2016, up 1.3% over a year ago. Private label frozen pizza is performing well; sales were up 13.5% in 2015. The U.S. frozen pizza category appears to be somewhat stagnant when it comes to product innovation, however (Packaged Facts 2015); new pizza product launches in the United States have dropped by half since 2011, accounting for just 10% of new pizza launches globally in 2015 compared with 19% in 2011 (Mintel 2016). In addition, the percentage of consumers eating frozen pizza in the past 30 days dropped 3% from 2010 to 2014 (Packaged Facts 2015).

As in most other food categories, pizza consumers are looking for more premium options, and according to Mintel, 58% of U.S. pizza eaters say they would buy more frozen pizza if it had more premium or gourmet ingredients (Mintel 2016). Frozen pizza may also be losing momentum as people look for healthier food and options that don’t feel processed, says Packaged Facts, but Sanjay Gummalla, vice-president of regulatory and technical affairs for the American Frozen Foods Institute, argues that frozen pizza is the opposite of processed. “Other than mixing the dough, there’s nothing else processed. Ingredients are literally put on the base,” he says. “Freezing … makes sure it’s safe till it’s cooked. I don’t think frozen pizza should ever be connected with the word processed.

Table 1. Dollar Sales and Percent Change in Frozen Pizza. From Infoscan Reviews, IRI
Table 1. Dollar Sales and Percent Change in Frozen Pizza. From Infoscan Reviews, IRI

Refrigerated pizza may enjoy more opportunity for growth, according to Packaged Facts. While sales for refrigerated pizza sold in supermarkets, drugstores, mass merchandisers, convenience stores, club stores, and dollar store chains are down 3.6%, per IRI figures for the year ending Aug. 7, 2016, Packaged Facts sees growth potential for chains like Papa Murphy’s as well as private label grocery store offerings (Packaged Facts 2015). If this growth happens, though, it will likely be slow. These categories may be slowing because of the availability of healthier options in the grocery store, as well as home-cooked meals (Packaged Facts 2015).

In addition, a stronger economy means more people are dining out, and increased restaurant visits hurt frozen and fresh pizza sales. Frozen pizza is competing with all the other ways consumers procure pizza, says Gummalla. This now includes a growing number of fast-casual restaurants such as Persona Pizzeria. “I want [the frozen pizza] demographic,” says founder Glenn Cybulski. “I want the people who can’t afford to take their kids out for pizza.”

Eating pizzaPizza in Restaurants
While frozen pizza consumption may be slowing, consumers are still choosing pizza when they dine out. Chain pizza restaurants are growing because of the value they deliver to consumers, according to the online publication Eater. According to Technomic, pizza consumption in restaurants is trending at its highest level in the past four years and showing growth across channels (Eater 2016, Technomic 2016). Seventy-six percent of consumers have eaten at a pizza restaurant in the past 12 months, suggesting broad appeal and a strong value proposition (Packaged Facts 2015).

In restaurants, unique toppings are increasingly key; 39% of consumers say new and innovative toppings are highly important (Technomic 2016), and restaurants have an advantage when it comes to selling their creations, says Dax Schaefer, director of culinary Innovation at Asenzya. There, a detailed menu and knowledgeable servers can explain the intricacies behind an unusual concept, while frozen pizza makers are limited to what they can fit on the box. Restaurant chefs can also more easily repurpose ingredients from poorly selling experimental pizzas than packaged goods manufacturers can, he claims.

At fast casuals—restaurants similar to Chipotle where consumers craft their own pizzas while walking along a counter—consumers get an opportunity for customization and creativity. Customers at Pasadena, Calif.–based Blaze Pizza can include unlimited toppings from the prep bar on their pizza, giving them the freedom to try something new, be as healthy or indulgent as they desire, and see exactly what they’re ordering. “Fast pizza that you can build yourself has been an eye-opener for people,” says Greg Dunn, owner of Persona Pizzeria’s Chicago location.

This uptick in restaurant visits may have some positive points for retail manufacturers, though. “Restaurant brands continue to enter the retail landscape as a way to keep consumers engaged with the brand when dining at home,” says Packaged Facts, and Schaefer agrees. “When people know a restaurant, they’ve already been educated about the quality of its products and trust it, so they may be more willing to try its retail products,” he observes.