All hell is breaking loose
Hell Pizza, that is. Get the scoop on this emerging pizza chain in New Zealand that is burning up that country's burgeoning pizza market.
It was back in 2003 when PMQ first heard of an up-and-coming pizza chain in New Zealand that was raising Hell and getting a lot of attention. Publisher Steve Green visited this emerging chain and then came back to tell me about it. After looking at the photos and concept, I was quite eager to get their story, but the owners asked that we hold off on it for a while until they were ready. Systems are now in place, franchises are being sold left and right and Hell Pizza is ready to tell about their deal with the Devil.
What really grabbed my attention about this franchise was not only the fact that they have sold 30 franchises in the past year and a half, but their attitude, energy and marketing strategies. Hell Pizza rose from the ashes in 1996 through the creative thinking of one guy with a vision. That vision was to create a fun, hardcore, elastic brand in what he thought was the boring world of mainstream pizza. In 2003, they sold their first franchise and the business was off and running. First, let's look at the owners and how Hell Pizza came to be and then we'll get into some really hot marketing ideas.
The owners of Hell Pizza are Callum Davies (age: 32), Stuart (Stu) McMullin (age: 33) and Warren Powell Otis (age: 37). The initial idea came when Callum, at the age of 20, bought a run down pizza shop. In 1996, Callum re-branded the concept as Hell and floated the idea past his buddy Stu.
"Playing the Devil's advocate, I trashed the concept, but he went ahead with it," Stu said. "In 1999, I approached Callum and we opened the second location, but we still weren't thinking of franchising at that stage, just having fun with a brand. The idea of franchising didn't happen until 2002, and that is when Otis became a partner in our company.
"Each of us has our own specialty and contribution to the company," Stu says. "Callum has been at the coal face of running a business from zero to hero. He does the branding, marketing, and recipes. Otis's specialty is franchising. He handles all of the legal aspects and occupational safety, HR, etc. I had an IT and corporate banking background, so I gave the company more structure, ops systems, and created the IT architecture along with a company called Spikefin for our in-house POS system. The brand is as strong as it is not only because of the strength of the directors, but also because of the types of franchisees we bring aboard."
Franchising and the Numbers
Stu said that the first step in creating their franchise was having a solid backbone. "We had a great name, great pizza and great marketing - our challenge was bringing these together whilst still being true to the original concept," Stu said. "The skeleton was having a solid IT and operations systems in place. We brought in a consultant at the cost of about $5,000 to $6,000. This was big money for a couple of pizza boys. He basically told us what we already knew - that we didn't have the structure or systems. He told us we needed to create operations manuals, structure in advertising and solid business plans. Some of the surprises we ran into along the way were setting up systems for food complaints. Before we started franchising, we handled them on an individual basis. As a franchise system, we needed a documented process to make sure every customer was satisfied. When it came to the IT stuff, we had to modify our systems, make sure everything was backed up with a UPS and have backup software, antivirus etc."
Once 80 percent was in place, they decided to start selling franchises. The guys at Hell Pizza aren't greedy like many franchisors. To buy a Hell Pizza franchise, the franchise fee is $26,500 and franchisees pay 5 percent royalty and 3 percent marketing fees. Stu says it costs about $220,000 to open the doors. The franchise fees give new owners a project plan to build their store, equipment lists, intensive training, systems (POS, Ops and IT software), but don't start writing that check just yet. Stu says they turn down nine out of 10 applicants.
"We look for people who are passionate about pizza," Stu says. "They also have to be committed to working in the shop. We don't want or need absentee owners. We also look for people who really get the brand and won't be scared of the concept or some of our marketing because we really push the envelope with some things. Some of our ad campaigns are fun and really out there. I am sure some of the things we do scare some people away and offend some, but get over it - any news is good news and a lot of those who are easily offended aren't our customers anyway."
Hell Pizza is only located in New Zealand right now with 30 locations, but the rest of the world needs to watch out. They are working on a test location and looking to move in to Australia. Stu said master franchises are ready to be sold right now. They are also aggressively looking into Korea, the UK and the U.S. Stu says it is their goal to be in the UK and Australia by the spring of 2005. Each store sells an average of 1,000 to 1,200 pizzas per week and pizza sales comprise about 60 percent of the menu. Hell offers takeaway, pick-up and delivery. Average order times Mondays through Wednesdays are 10 minutes for takeaway, 15 minutes for pick-up and 30 to 40 minutes for delivery. About 10 percent of orders come from the Web with some stores achieving as high as 23 percent.
"The foundation of Hell was built on producing high quality food that is Hell specific," Stu says. "All the sauces, pasta sauces, cheesecakes, bases, etc. are original Hell recipes. Flavor profiling is incredibly important in this business, so if a customer is hooked on your flavor they won't be going anywhere else. We want them in Hell for life!"
Now comes the fun part. I have to say, out of all of the pizza marketing I have seen, I really loved some of the things Hell Pizza does. As Stu said, many of the things they do can be a bit edgy and offend some, but only those who don't get it. I love the idea of getting attention through cutting edge marketing, so here are a few of the strategies Hell has employed.
One of the first things I was told about Hell Pizza was their hearse. When I asked Stu about it, he said we could take a ride. When I first saw it I was floored. What they have done is taken an old 1970's Cadillac and converted it into the ultimate mobile marketing tool. The car is decorated with the Hell Pizza logo, racing wheels and it has "The Quickest Way to Hell" painted down the side with their Web address. There is even a coffin in the back! They deliver special orders in the car and drive it around town gaining attention wherever they go. I have never had so much fun taking an afternoon drive. As we cruised, everyone we passed, both walking and in cars, were pointing and smiling. Now, that's marketing. But this isn't all they have done with the car. They equipped it with nitrous (NOS), making it the world's fastest hearse-certified by the Guinness Book of World Records. Talk about fast delivery.
They also have two 1970's police cars, complete with police lights and sirens. They also have the Hell logo and it has "To Protect and Serve Damned Tasty Pizza" painted on the side. It is an attention-getter as well, but I asked Stu how they used it. "We just purchased the cars locally," Stu said. "We plan on driving around near other pizzerias and pulling over their drivers and people walking out with pizza from our competitors. We'll be issuing tickets for serving or eating bad pizza," he laughs. I mention that he is sure to get tickets for impersonating an officer. "Yeah, I know," he returns. "But the publicity, media attention and word of mouth we will gain will be worth so much more than the tickets we pay. We are also in the process of getting an old ambulance from the U.S. We are gonna call it the Satanbulance!"
Hot-rod hearses, police cars and ambulances aren't the only mobile marketing tools they use. They also have beach buggies, Mini Coopers and three wheel scooters that are painted with their logo they use to deliver pizza. The scooters are a great way to deliver pizza in that they are very fuel-efficient and attract a lot of attention with the logoed shells they have. Stu says they import them from Japan and have a sign company (Cannon Signage) that hot-rods them up. He says each scooter costs about $3,000 each and only use about $5 in petrol a week. They are also easy to park on sidewalks, making deliveries faster.
Stu said one of the fun things Callum did with the beach buggy was to load it up with water balloons, dress the shop staff up in devil masks and drive around water bombing Eagle Boys Eagle mascots in front of their stores. "Yeah, we would pull up with one guy filming and nail the guy dressed in the costumes," Stu said. "We made a video out of it (on the Web site). It was hilarious - you have to have some fun in business."
The Hell concept just begs for catchy and flashy signage and this is one area they have not overlooked. In addition to catchy signs with "Meet Your Neighbors from Hell" above most locations, they also have the number 0800 666 111, which they advertise as The Number of the Feast. Their themed stores feature industrial interiors with pumping sounds. They have also used edgy promotions in billboards in other areas. In one location they found a sign with a woman on her hands and knees advertising a company. They bought the sign next to it and put two Hell Pizza employees holding a pizza paddle behind her getting ready to - well, put the pie in the oven. Needless to say, they were forced to take it down, but not before it captured a lot of attention. "Yeah, we p*ss a lot of people off, but they don't order from us any way," Stu says.
Thinking out of the box, Hell ran a promo for their popular meat lovers pizza. It illustrated a broken condom wrapper with a slice of pizza sticking out of it. The byline read "Our pizza for Meat Lovers". It is unorthodox, but still a good way to burn their name in customers' minds.
"Everything in Hell is for sale," Stu says. "We have Evil Beenies, T-shirts, Devil Ducks, boxer shorts and other stuff for sale. Our customers have driven us to do it. Our shirts have things like "Giving oral pleasure since 96," "Bitchin in the Kitchen," and "Eat Me" on the backs. Customers kept asking if they could buy them, so we now offer them. I had a friend in the UK who told me he saw one of our shirts there. We are about to run a promotion where when you order our hottest pizza you get a free pair of boxer shorts - you may need them later in the evening! We are constructing coffin display cases to showcase the merchandise. Everything in the shop is for sale, even the artwork. I also love bumper stickers. We have a lot of different stickers made up and you will see them all over town."
One of the most successful things Hell employs is their Web site (www.hell.co.nz), which was created by Spikefin (www.spikefin.com). Up to 23 percent of their orders come through their Web site. The site updates the wait times for orders every 30 seconds so customer will know how long it will be before the pizza arrives. If orders are backed up, customers can choose another location to get it there faster. Stu says that Web orders take top priority and are sent through first. The site was the #1 food and beverage site in New Zealand, out-performing pizza giant Pizza Hut.
Exploring Hell Pizza was one of the most fun assignments I have had. Sure, they are a bit out there, but that is what I like about them. The company was built by a group of young, energetic guys and their concept reflects that energy. They understand the value of getting attention and use every opportunity to get people talking. They have created their own in-house POS system that employs humor and the Hell concept to train employees. They have shocked consumers into paying attention. In the process, they have forced other pizza chains to pay attention. It's not to say you have to go to these measures, but it does demonstrate how thinking outside the normal boundaries and trying new things gets your name out there to the public and your pizza in their mouths. All I can say is, if you see one of their locations - go to Hell.