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SUNSHINE NESTOR / scroll staff
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Impact of the $5 pizza
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In the year and a half since the Hot and Ready promotion has come out, Little Caesars has “increased sales by over double chain-wide,” said David Morris from Rexburg, co-manager of the Rexburg Little Caesars. Morris said this same result was seen on a local level, with Idaho sales also doubling. “The Hot and Ready is here to stay for a long time,” Morris said. The Hot and Ready pizza is the same exact pizza that Little Caesar always makes; it is the quality and the fact that it is “ready now” that attracts customers, Morris said. “If consumers are going to respond to changes in the price, then usually firms will respond also,” said Ronald Nate, professor in the Economics Department. Nate said that when it comes to $5 pizzas, because there are just a few pizza firms, Little Caesars may exercise “price leadership”meaning the lower price of Little Caesars Hot and Ready pizza will cause an impact on the other pizza companies in the same market. Recently Craigo’s Gourmet Pizzas came out with a Grab-n-Go pizza. Offered only at the Craigo’s Pizza Outlet located in Broulim’s, this promotion includes pepperoni or cheese pizzas that are ready at any time for only $5. A variety of options is one technique companies may use to combat competition. The Craigo $5 pizza is not limited to just pepperoni or cheese. The choices include “three different types of crust, four different sauces and ten toppings. You can choose any combo you want and for only a dollar more you can get another topping, up to [a total of] four toppings,” said Alison Barnes, a sophomore from Rexburg, and manager of Craigo’s Pizza Outlet. A pizza with a choice of crust, sauce and topping is available for $5 or $6 and is made on the spot or can be called-in over the phone. Due to this promotion, Barnes says business has been more than double. At Domino’s Pizza, “we sell a large one topping for $5 [that’s] carryout only,” said Caleb Maher, a freshman from Pahrump, Nev., and a customer service representative for Rexburg’s Domino’s Pizza. The Hot and Now pizza offered by Domino’s Pizza is a pepperoni pizza available as soon as it’s ordered. Again, the $5 special is not limited to pepperoni only. Any one topping pizza can be ordered for $5 and would be ready in seven to ten minutes. Maher said customers most interested in this special are usually college students and those not looking to wait a long time. Another local player in the pizza market is Mama K’s Pizza and Salad Buffet. Offering an “all-you-can-eat” buffet for $4.99, Mama K’s tries to appeal to a little bit of everyone. “One of the really cool things we are doing is [every] Thursday we have a pizza eating contest. Contestants try and eat a whole pizza,” said Amy Haymore, a senior from Marietta, Ga., and an employee of Mama K’s. The contestants eat the pizza for free, but bystanders have to pay the normal buffet cost. There are other ways to combat competition besides lowering prices. “[Companies can] keep customers by varying products. Papa Murphy’s [might] not have to do a $5 pizza because it’s a ‘luxury’ pizza,” Nate said. Papa Murphy’s may be considered a luxury pizza because people can take it and bake it whenever they want to. Pizza Hut differs in regard to many of the other local pizza stores in that it has not implemented a $5 pizza. “I think that it takes away partly from our business because we don’t offer that,” said Terren Pyeatt, a senior from Selah, Wash., and a server at the Rexburg Pizza Hut. Instead, Pyeatt said there are other ways that Pizza Hut competes with the competition. These include quality, such as putting more toppings on the pizzas, offering dine in service and having national and international brand recognition. “Something we try to [do is] focus on our service,” Pyeatt said. |
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