GIVING PIZZA A WHIRL

KATHLEEN MENDOLA

Supermarket pizzas in the deli and food-service sections are just about as ubiquitous as roasted chickens, with new and revamped programs, hot and cold, getting tossed into most new stores and remodels.

But while they keep garnering prime store space, are these pizza programs holding their own in a competitive market crowded with low-cost frozen pies and legions of independent and chain pizza specialty outlets?

The answer varies widely, according to retailers and food experts, and for the most part depends on how each supermarket is positioning its products and executing its program in terms of product quality and merchandising. For certain, there is no guarantee that a fresh-pizza program won't be more trouble than it's worth -- and as a community, supermarkets are still trying to get pizza right.

"If it's correctly done, an in-store pizzeria can be a successful program," said Jim Reisenberger, a Rochester, N.Y.-based supermarket consultant with expertise in fresh prepared food. "The downfall is an unattractive display. Pizzerias need to make a statement of opulence, mouth-watering scents and product-heavy visuals. Those committed to such requirements are seeing results."

A lot of operators keep trying to catch that pizza ring. In the past year alone, there's been a rush of retailers spinning their pizza strategies. At its new stores in Tampa, Fla., Kash n' Karry Food Stores introduced programs selling pizza by the pie or slice. Grand Union Co., Wayne, N.J., tried its hand at in-store pizza inside its new hot-food format. Harris Teeter opened pizza bars in stores near its company headquarters in Charlotte, N.C.

Buttrey Food & Drug Stores Co., Great Falls, Mont., and Pay Less Supermarkets, Anderson, Ind., went the turnkey route, with Orion Concepts' Moose Bros. Pizza as part of in-store food courts.

Fleming Cos., Oklahoma City, developed and introduced a turnkey program for its clients, called S'Italian, which incorporates pizzas with Italian specialties and sub sandwiches.

In other instances, leased food-service operators have even opened co-branded pizza operations, such as Popeye's inside a Kroger Co. store in Cincinnati.

It's not hard to see why. Ninety-four percent of the U.S. population consumes pizza annually, according to the National Association of Pizza Operators, New Albany, Ind. Pizza also makes up 17% of the total restaurant business, according to the trade group.

With 5% to 6% growth reported each year and over $30 billion in sales nationally, it's a food category not to be ignored.

Russo's Stop-N-Shop, Chesterland, Ohio, is one operator that gives in-store pizzas the thumbs up.

"We're doing really well, and more markets want to pick up on it," said Amorita Daley, bakery manager. "Having pizza on a baking stone creates an old-fashioned crunch, which is appealing to customers. They also like the atmosphere of a wood-burning oven," she said.

The company builds a whole theme section around pizza, which may help. "We round out the pizza offerings with related items, such as pepperoni rolls, garlic breads, pizza bagels, pancetta breads, lasagna and calzones," Daley told SN.

The result? Pizza sales at Russo's average about 20 pies on weekdays, and jump to about 30 pies on weekends.

Balls Food Stores, Kansas City, Kan., also is placing fresh pizza in the center of an Italian-themed section in the chain's newest unit under its Hen House Market banner. The store, opened in Lee's Summit, Mo., last month, offers pizzas cooked in a hearth oven and merchandised alongside other specialties, such as calzones, panini sandwiches and Caesar salad.

The program is a good example of what appears to be an emerging trend for in-store pizzas -- high-quality crusts with toppings from the gourmet end of the spectrum, often being cooked in specialty ovens.

But it is not the chain's first shot at pizza.

"We've been around the world with pizza, trying to find the concept that works for us and this market," said David Gryszowka, executive director, sales and marketing/store development. "We've had Godfather's Pizza in, Moose Bros. Pizza in, and others. But we have not thrown in the towel yet on pizza. We still think it is an important element, and this time we are going with hearth-oven pizza, using fresh dough.

"For the first couple of weeks, pizza was the No. 1 food-service item here," he said. "But it is the hardest to execute and be successful with. You are competing against delivery, and that is hard to beat.

"We are taking the tack of offering a high-quality pizza at a reasonable price, such as a 16-inch cheese, sausage and pepperoni pizza for $5.99 on special."

The in-store pizzerias in Sutton Place Gourmet, Rockville, Md., pull fresh ingredients from throughout the store -- Sutton Place-branded olive oil, fresh tomatoes and herbs, house-made mozzarella cheese and sausages.

"It's a great way of showing off the food that we create and sell in the store," said Betsy Garside, communications director. SPG customers look for fresh herbs and boldly flavored toppings, such as smoked chicken and asiago cheese, she added.

Gourmet is becoming a popular descriptor when it comes to pizza, according to Michelle Berberet, a spokesperson for NAPO. She said toppings such as artichoke hearts, white and pesto sauces, tuna, Cajun shrimp, oysters and eggplant are competing with the old standbys pepperoni, sausage, Canadian bacon, peppers and onions.

Gourmet is attractive, but flexibility and speed are what counts in supermarkets, said Garside of Sutton Place.

"In seven minutes, your fresh, made-to-order pizza comes out of the wood-fired oven," she said. Phone and fax orders add to the convenience factor.

Set menus with daily specials reflect the willingness of Sutton Place to respond to consumer tastes, Garside said, as does seasonally changing menus -- heartier in winter and lighter in summer -- which highlight the program's versatility.

The pizzeria idea works well with the Sutton Place traiteur (a prepared-food kitchen). Most of the kitchen is open to customers who can already watch their salad being tossed or their salmon being cooked, according to Garside.

To stay in sync with their fresh-food appeal, Sutton Place pizzerias don't serve slices. "We don't want a partially served pie sitting under warming lights for most of the day," Garside explained.

What's their marketing strategy? Aroma, Garside said. "Customers are able to see their pizza made and placed into an oven. Smelling hot, fresh pizza is a compelling marketing tool," she added.

Many supermarkets are still searching for the right formula for achieving compelling levels of sales, however.

"We're struggling with pizza as a category," said Tom DeVries, director of food service at D&W Food Centers, Grand Rapids, Mich. "We're trying to elevate our parbake product over frozen pizza offerings with higher-quality ingredients and more ingredients."

So far, most of the sales have been coming from the company's slice program, which is more successful than whole-pie sales, said DeVries. While six of D&W's 24 stores operate in-store pizzerias, he said the chain is still looking for the most effective way to market pizza.

"We need to categorize parbakes as one business, and hot-to-go pizzas as another. Now, they're lumped together with general supermarket pizza," he explained. "They need to be marketed in two different ways. Unless we do something to discern a difference, we'll be fighting an uphill battle. It's difficult, when frozen pizza offers a similar product."

He ascribes the challenge to marketing because, he said, his problematic sales of pies are "not due to poor quality, because our fresh pizzas are of equal or better quality than frozen offerings. We just haven't figured out yet how to market it or convey that to customers."

D&W is now working on a new program that will rely on a personal-sized cafe pizza. "We'll focus more on pizza as an individual entree, and use more gourmet toppings -- such as smoked chicken and artichokes and other toppings -- which draw a distinction from frozen."

Some supermarkets leave the pizza to the experts, relying on turnkey operations to set up shop and bring in customers.

At Byerly's in Edina, Minn., Wolfgang Puck is the pizza operator of choice. Mary Lou Long, director of deli operations, said the key selling point of Puck's operation is fresh ingredients. From the hand-kneaded dough to the fresh herbs and sauces that top the pizzas, nothing is canned, frozen or processed.

"Instead of offering fast food, our goal is to provide restaurant-quality food," Long said. "To reach this goal, we have brought in more chefs. That's also why we went with Wolfgang Puck's in-store pizzerias. If someone can do it better [than us], we want to use that expertise. Wolfgang Puck fits with our store profile and what our customers demand -- fresh, high-quality ingredients showcased in an innovative trend."

Byerly's sells several other Wolfgang Puck items to support the line, such as butternut squash, Tuscan bean and tortilla soups; Caesar salads and hot pasta to go. The chain also sells Wolfgang Puck fresh refrigerated pasta, sauces and dressings bottled on-site.

Moose Bros. Pizza is a turnkey operation that has had success typically in stores serving nonurban areas.

"The draw with a Moose Bros. set-up is the total system package," said Matt Ditmanson, national brand manager, for Moose Bros., Sioux Falls, S.D. "We take it a step further than just providing raw materials. We offer everything the retailer needs from set-up to installation, and we offer services above and beyond with marketing support, and sales and operation training.

"It's expensive for retailers to work with advertising and marketing personnel, so we put it all in one affordable package."

Moose Bros. provides options for all three meals, with a scrambled egg, mozzarella cheese and bacon breakfast pizza, slices for lunch, and hot carry-out or take-and-bake pizzas for dinner. He added that what's big in pizzas now are "gourmet pizza with barbecue chicken or beef, and taco pizza. We're testing different varieties in different areas so we can tailor to the needs of varied markets.

"I believe in regional taste preferences more than anything. In the East, people lean toward white pizzas, while Chicago-area pizza aficionados may reach for authentic sausage and thick-crust pizza," Ditmanson said.

Moose Bros. operations take phone and fax orders and have tested delivery in some areas, but it's not their primary focus, according to Ditmanson. "In the smaller rural markets, we may have an opportunity to deliver."

To help market the product, Moose Bros. offers licensees a monthly marketing plan tailored to their price points. Posters, ad slicks, flyers, and regional coupons are supplied.

In Ohio stores, Moose Bros. employed a marketing gimmick that attracted attention -- the "Moose phone." A full body moose costume draped on a mannequin held a phone that customers could use to call in their order while they shopped.

Beyond reaching customers, the challenges for in-store pizzerias include employee turnover and training, and retraining. Another persistent challenge is sanitation, the personal hygiene of employees, as well as the preparation surfaces, Ditmanson said.

But it all comes back to fresh, ingredients that attract customers.

"Pizza will always be driven by the quality of the product," consultant Reisenberger said. "You have to have a competitive advantage, and that edge is quality."