The PepsiCo unit's achievement upsets the neatly drawn niches the three chains have held in recent years: Little Caesars has owned takeout, while Domino's dominated delivery and Pizza Hut ruled dine-in. But national market share figures obtained from an industry source show that for the first eight months of 1995, Pizza Hut is No. 1 in all three categories.
The shakeup illustrates not only Pizza Hut's success with Stuffed Crust, but the difficulty its competitors have had broadening their brands. As Domino's seeks an identity after forfeiting its 30-minute delivery guarantee, Little Caesars has stepped outside its value-driven carryout niche, adding an upgraded line of Pleasers! pizzas and launching a nationwide delivery program.
In reaching outward, however, both chains appear to be losing their core positioning. Based on dollar sales for the first eight months, Little Caesars' carryout share fell to 21.5% from 26% a year earlier; Pizza Hut went to 27% from 23%.
Determining absolute market share is difficult. Some chains track share internally, while many use figures from NPD/Crest tracking customer visits. Based on NPD/Crest figures through May, Pizza Hut confirmed it leads delivery and said it may have topped carryout during the summer. NPD/Crest, Rosemont, Ill., will report summer results soon.
"The trend is definitely there. Our carryout has been growing rapidly ....Little Caesars' has been declining rapidly," said a Pizza Hut spokesman.
Since June, when it began offering delivery, Little Caesars has devoted virtually all media spending to the service, in ads from Cliff Freeman & Partners, New York.
A spokeswoman said Little Caesars believes it still tops carryout, but it "wouldn't be unusual to see some market share shift as new products and services are introduced."
History proves that: When Pizza Hut entered the delivery fray in 1986, it lost the carryout lead to Little Caesars. And until Pizza Hut began delivering, Domino's consistently had 50% of that market.
Domino's share of delivery slipped half a point to 31% in the first eight months. More significant is Pizza Hut's gain, up to 34% from 31.5%.
Domino's positioning has been in flux since it ended the 30-minute delivery promise in December 1993. The chain is on its third marketing director in as many years. Current VP-Marketing and Product Development Cheryl Bachelder will sack the "Gotta Be Domino's" campaign early next year for ads focusing on food quality.
Ms. Bachelder hand-picked a new creative and account team for Domino's at Grey Advertising, New York, ending speculation about a review.
Responding to the shift in market share, a spokesman for Domino's cited Pizza Hut's heavy summer ad spending. "We aren't happy about it and we do plan to regain our No. 1 status in delivery, but we understand why it happened," he said.
For first-half 1995, Pizza Hut spent $88 million in measured media, up 7.3% from a year earlier. The chain this fall remains aggressive with Stuffed Crust ads from BBDO Worldwide, New York, planning to spend another $25 million to $30 million on line extensions. Domino's spent $41 million in the first half; Little Caesars, $33 million.
Little Caesars is testing its own stuffed crust pizza in a few markets including Detroit.
Launched in March, Stuffed Crust helped reverse Pizza Hut's sliding dine-in sales and bolstered carryout and delivery, said Manny Goldman, an analyst with PaineWebber, San Francisco. To keep dine-in sales healthy, Pizza Hut in '96 will double its kids marketing budget to $10 million, bringing back the Pizza Head character from Goodby, Silverstein & Partners.
Alice Z. Cuneo contributed to this story.