Guess what? Average per capita consumption of coffee is half of what it was in the 1940s. That’s right. Coffee consumption actually started declining in the middle of the last century in spite of lower and lower prices, and greater and greater availability. As coffee became available everywhere from convenience stores to vending machines, competition fueled plunging prices. Of course, lower prices were a direct result of mass-production and blending in lower quality coffee beans. Once the rush to cheaper coffee was started, it took on a life of its own. Ironically, cheaper prices didn’t inflate demand.
Then a strange thing happened. Coffee consumption began rising again in the mid 1990s. In fact, sales at coffeehouses like Starbucks increased 97 percent from 1998 to 2003. And overall coffee consumption is up 20 percent since 1995 and holding strong.
What this hints at is that just because prices are low, that doesn’t mean you will sell more. People will pay more for something they want. But if the product is inferior, they’ll quit buying it altogether.
Cutting quality in order to cut prices will simply, over time, lower demand for the product. Eventually, you’re making less and less.
Look at Domino’s, for example. Right now they’re stepping up quality in a rather dramatic way. They’re sharing customer complaints online and in their advertising, and showing the steps they’re taking to address these issues and make the pizza tastier.
Driving from warehouse to warehouse hunting for the cheapest ingredients or switching from a quality brand to a generic will eventually catch up to you. Then what? Find even cheaper ingredients?
I wrote the following ad copy for a new pizza concept here in Las Vegas. My aim was to paint a picture of quality ingredients, which connects the dots to great taste without the empty “best pizza in town” boast that even the discount shops use. Look this over with an eye towards your own shop. What aspect of great taste can you own?
“Somewhere between the brick ovens of Italy and the delivery cars of America, something went horribly wrong. Traditional pizza, made with homemade bread, rich, creamy cheese and handpicked tomatoes, is now tricked out with inflated “fast-dough,” skim milk, water-added cheese and sauce from factory-farmed tomatoes. Enough is enough.
“We didn’t set out to make the most expensive pizza, or the cheapest … but to bake a good, honest pizza … hand-made from scratch, baked in an old-fashioned flame-fired oven, and to also guarantee each pizza to be delicious – or your money back. “Here’s what you can expect from Ciao Ciao…”
I then went on in the copy to vividly explain what makes Ciao Ciao’s dough, sauce and cheese better than the competition.
I talked about the dough needing time to develop flavor through the interaction between the sugar and yeast. I talked about the tomatoes Ciao Ciao uses for its sauce being bold in flavor and aromatic. I talked about the cheeses being rich and made from whole milk. By using descriptors that pointed to quality, the copy demonstrated that Ciao Ciao in fact makes a premium pizza.
The ads based on this copy feature photographs of the owner to humanize the business — and they also offer up a money-back guarantee. A few pizzas are featured along with pricing, which is in the ballpark. Not expensive, not cheap.
The place opened last July, and business has been rock-solid so far. If each pizzeria owner put a little thought in “how to make a tastier pizza” and serve it at a fair price, the entire industry would benefit. The race towards the rat-hole of cheaper and cheaper just hurts the pizza brand in the long run. ?
Kamron Karington owned a highly successful independent pizzeria before becoming a consultant, speaker and author of The Black Book: Your Complete Guide to Creating Staggering Profi ts in Your Pizza Business. He is a monthly contributor to Pizza Today.