Pizza Hut expands beer delivery service

Pizza Hut is leaning into its beer delivery service to get an edge over Domino's.The pizza chain announced on Monday that it is expanding its beer del...

Posted: Jan 7, 2019 9:45 AM
Updated: Jan 7, 2019 9:48 AM

Pizza Hut is leaning into its beer delivery service to get an edge over Domino's.

The pizza chain announced on Monday that it is expanding its beer delivery program to 1,000 locations by the summer.

Beer delivery will be up and running in nearly 300 locations in Florida, Iowa, Nebraska, North Carolina, Ohio, California and Arizona by mid-January. Pizza Hut is the only national pizza chain that delivers beer.

Delivery has become increasingly important for restaurants trying to reach their customers outside of the store and learn more about their preferences. For pizza chains, the stakes are higher. Unlike other fast food companies, pizza restaurants have been successfully offering delivery for years. To stay competitive, they have to up their game.

Pizza Hut tried out beer delivery for the first time in late 2017, and rolled the program out to nearly 100 locations in May. The chain has about 7,500 locations in the United States, according to the chain's website.

Customers have responded well to the option, said Marianne Radley, Pizza Hut's chief brand officer. The "positive feedback ... is a big driving force behind this expansion," she told CNN Business in an email, adding that new customers have started ordering from Pizza Hut because of the service.

For years, Pizza Hut outsold competitors Domino's, Papa John's (PZZA) and Little Caesars. But recently Pizza Hut has been losing ground to Domino's. Last year, Domino's sales exceeded Pizza Hut's for the first time.

Same-store sales at Domino's (DPZ) have increased over the past few quarters, but slumped slightly for Pizza Hut.

Both Domino's and Pizza Hut have poured funds into delivery and run flashy promotions to advertise their capabilities.

Domino's delivers to outdoor locations like parks and beaches through its hotspots program, and has tested delivery by drone, robot and reindeer.

Pizza Hut developed insulated pouches designed to keep delivery pizzas up to fifteen degrees hotter. It's also made bluetooth-enabled "pie top" sneakers that let you pause your TV and order pizza with the push of a button.

"Our customers have come to expect a top-notch delivery experience," Radley said. Tossing beer into the mix "has upped the ante." Pizza Hut is deliberately rolling the service out in time for the Super Bowl.

A wide variety of beers, including Blue Moon, Bud Light and Corona Extra, are available for order.

All participating locations have liquor licenses. To make sure that its not serving underage customers, Pizza Hut employees will check ID when the order is delivered. Customers also have to fill out a form for Pizza Hut's records, Radley said.

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