The heads of two of the biggest players in the market, Domino’s and Eagle Boys, believe the lines between gourmet and fast food are certainly blurring.

“What some of the boutique chains offer today is what the masses will eat tomorrow,” says Don Meij, CEO of Domino’s.

Pizza companies that belong in those other, more upmarket segments of the industry are on the radar, but according to Meij they are not direct competitors. “Our direct competitors are the other major chains in the greater market, and then other people like McDonald’s, KFC and Subway. People can’t afford pizza for $50 every week. Our average meals are 40 per cent of what a gourmet chain would charge,” he explains.

Eagle BoysÕ CEO Todd Clayton agrees with Meij. “We’re in the chain segment, there’s no doubt. But with a gourmet trend,” he reiterates. “We will always be seen as a chain because of our size, but I think with the locations that we have, the quality of the product offering, I think what’s going to happen over the next five to 10 years is that we’ll be able to offer so much more value that people will really question whether they have to pay $20 for a pizza when we can produce the same thing for $12 to $14.”

Hell Pizza fits into the gourmet segment of the industry, offering pizzas for about $18 and focusing more on good quality service and produce than affordability. Wayne Patterson, marketing consultant, is aware that the

larger, cheaper chains are starting to offer gourmet-style pizzas, but is still confident that Hell offers a product that isn’t easy to duplicate cheaply.

“The outlets that have been around for a long time; Domino’s, Pizza Hut and Eagle Boys, they’re trying to extend their reach into our space to a degree,” he says. “I don’t know how successfully they are doing that. Their business model, it does inevitably sacrifice a little bit of service and quality of product to get that price back down to where it is. So I think they can see that the market space we’re in is a desirable one because we attract the general, blue collared person who wants a quick meal but we’re also good enough to appeal to people who, if they wish to be eating out a couple of nights a week at fine dining restaurants, they could do that. We can cross those boundaries.”

Crust has paid special attention to promoting its product as gourmet quality, and co-founder Logos agrees that certain franchises are trying to have their cake and eat it too, but are inevitably confusing their customers.

“[In the future] I think the industry is going to be segregated in regards to customers who want a low cost option and customers who want a premium option, they don’t mind paying for quality. There are a lot of places out there that are dabbling in different spaces, but the customer wants to be able to understand what your business is and what the brand is about. Are you a gourmet player? Are you a volume player?”

Points of difference

With so many competitors, pizza franchises need to create a point of difference and market it well to stand out from the crowd. Like most of its opposition, Sarpinos, which has 10 stores in metro Perth and two in Melbourne, prides itself on offering quality pizza at an affordable price. The company has, however, differentiated itself from others by being based in shopping centre food courts.

“In Perth, there are no pizzerias operating in food courts of major shopping centres, which generally attract high customer traffic,” says Sarpinos’ franchisor, Guan Kiat Soh. “We operate in the day hours, unlike most pizzerias which operate in the evening hours.

“Our price level does not compete with high-end fine dining restaurants, nor do we try to compete at the price war levels of the major pizza players such as Domino’s, Eagle Boys and Pizza Hut. Our philosophy in the food courts is to present our products so that our customers eat with their eyes before they eat with their mouths. We do not wait for a customer to order. The product is ready for a customer to take away within seconds of their decision.”

Pizza Hut has been operating since 1958 and has a very well established, loyal customer base.

“Certainly, Pizza Hut has a lot of heritage and a lot of history,” says Craig Mason. “You may have seen our tag-line recently, Famous For a Reason. A lot of what’s in the Australian market, we brought to the market. Pan pizza, stuffed crust, super supreme, all that sort of stuff was brought to Australia by Pizza Hut. So there’s a lot of heritage there and brand awareness and brand loyalty.”

The company does, however, understand the importance of changing with the times, and for this reason has made efforts to reduce the salt content of its meals. Health is an increasing priority for Australians, and most if not all pizza companies in Australia have done something to respond to this. Pizza Hut is no exception, but taste is still the company’s main concern.

“We’re providing messages around salt reduction. We are always looking at options around lower calories et cetera, but our message is that it’s a good tasting product, and people need to make a choice on when they eat it,” says Mason. “We can go for the whole calorie-controlled pizzas and so on, but the core message of our brand is taste and quality. We won’t sacrifice that to achieve something that just doesn’t get great taste.”

With tombstones on the front registers, coffin-shaped windows, a devil-sounding character as the telephone operator and pizza flavours that include Brimstone, Purgatory and Damned, Hell Pizza’s brand personality is clearly its point of difference.

“We’re very marketable and I think people affiliate with us because of that,” says marketing consultant Wayne Patterson. “We’re not just a Domino on a sign. We do have a bit of personality to our brand and to the people that work in our stores as well.”

Patterson says that the company’s unique identity helps it to distinguish itself from other players in the market and simply complements Hell’s “great food offering”.

Customers ranging from young families to the elderly all share a sense of humour and, says Patterson, appreciate good food.

For Pizza Capers, pizza toppings are the main priority. “We’d like to say that the closest product is the best, but it’s not always the case,” reveals co-founder Anthony Russo. “When putting the pizzas together, some people put feta on a pizza, and they just get the cheapest feta, but we go through a trial of tasting fetas from multiple companies and then if we can’t get it right then we normally discuss it with that company to make it the way we want it and brand it as our own, and it has our own unique structure.

“If we can’t get a company to produce it to the quality or style that we would like then we would purchase the machinery required to do it ourselves,” Russo adds.

He says Pizza Capers tries to avoid bombarding the public with messages of how healthy its pizzas are because of the perception that if a meal is healthy, it might not taste good. While the company’s pizzas are made in a healthy way, this isn’t made into headlines.

“I guess because we focus on quality, it [the pizza] ends up being healthier as well,” he says. “In saying that, weÕve also done our sums and weÕve got the 97 per cent fat free range and weÕve only got 10 per cent of our menu that is actually over 10 per cent fat, which makes us the healthiest pizza company on the Australian market at the moment.”

Pizza Cutters, which opened its first franchised store in May this year, has a similar focus, offering six pizzas which have the Heart FoundationÕs Tick of Approval and preparing all of its produce in-house every day. The company makes its own dough and sauces and, according to co-founder Simon Lumbroso, all of the meats and vegetables are fresh cuts.

Crust, which also offers a range of Heart Foundation approved pizzas, has a number of distinguishing factors, says co-founder Michael Logos. “The image that we initially tried to portray, or the brand identity that we tried to put out to the customer, was one of offering a restaurant quality experience at home,” he says. “That sort of shifted, although we are still trying to maintain that core appeal, to a health conscious image. We were probably one of the first in the market to target the health conscious consumer.

“We also shifted to the female demographic as well, because the females really make the decisions in terms of what the husband is going to eat and what the kids are going to eat and so forth. TheyÕre the decision makers. So that’s who we tried to target with our brand and our positioning as well. No one went after the female pizza connoisseur … so thatÕs where weÕre at today.

“I’d say our point of difference is one of many things. Number one is the way weÕve positioned our stores – strategically. Not to cannibalise each other, not to put them too close to each other so the stores arenÕt as profitable as they can be. Number two is making sure weÕve got the right franchisees on board who follow the system,” Logos explains.

“Number three is making sure the customerÕs experience is one of enjoyment, so they can make the transition from being a one-off customer to being a repetitive customer, to create that brand loyalty. TheyÕre things that all businesses try to do. ItÕs how you implement these things that really makes the difference.”