From small establishments to restaurant chains, the pandemic has badly hurt many food service industry businesses. But one segment has notably bucked the trend: Americans are eating more pizza.
When called upon by Forbes magazine to offer expert business insight into the current pizza boom, Shan Li, PhD, says she had to “do her homework.” An assistant professor in the Zicklin School’s Narendra Paul Loomba Department of Management, Dr. Li studies operations management with an emphasis on how human behavior, including that of managers and customers, impacts firms’ operational decisions. “So it was my natural instinct to pursue the customer-behavioral angle when I started to look at the pizza industry,” she explains.
Li, who earned a PhD in industrial engineering and operations research at the University of California, Berkeley, and worked for Amazon, Philips Research, and American Express before joining Baruch in 2013, proved to be a quick pizza study.
According to the professor, the rise in demand for food delivery in the lockdown should come as no surprise and neither should pizza’s capitalizing on this moment. “The pizza industry has been equipped to deliver and fulfill carryout service for decades,” she says. Add the pandemic’s impacts to the economy, employment, and customers’ constrained budgets: “It’s natural that customers sought out pizza. It’s a top choice for feeding a family at low cost.”
But not all pizzerias and pizza chains have benefited equally. According to Li, before the pandemic Pizza Hut and Papa John’s were struggling, with Domino’s the strongest of the big three. “With the growing opportunity provided by the lockdown, Domino’s winner advantage, which was brought about by its long-term investment in advancing its delivery capabilities, has been accelerated.”
Will pizza’s gain—especially Domino’s—stick once the virus is under control? Yes, predicts Li. “Whenever the pandemic winds down, the focus on health, safety, and convenience is going to remain.”
As for Li, she’ll likely be enjoying her own favorite: “The Thai chicken pizza from California Pizza Kitchen, because of its unique flavor and toppings. I like its pleasingly sweet and spicy taste.”