Casey's, a Midwestern gas station chain, is emerging as a significant force in the U.S. pizza market, outperforming major competitors like Domino's in sales growth and market share. With over 3,000 stores across 19 states, Casey's ranks as the fifth-largest pizza purveyor nationwide, according to Bank of America research.

From Fuel Stop to Pizza Powerhouse

Tom Brennan, Casey's chief merchandising officer, noted that while larger pizza chains may not often mention Casey's, the company's growth indicates it is steadily capturing market share. Bank of America research highlights that Casey's prepared food and dispensed beverage same-store sales growth has surpassed Domino's in 18 of the last 20 quarters. The company's stock price has seen a 50% increase over the past year, with a market capitalization reaching $58 billion.

Casey's success stems from its commitment to quality ingredients and unique offerings. Unlike typical gas station fare, Casey's pizzas, which debuted in 1984, are made with scratch-made dough and cooked in in-store pizza ovens. The menu features distinctive options such as taco pizza and breakfast pizza, which have gained traction on social media platforms like TikTok and YouTube. Travel influencer Tony Cu expressed a preference for Casey's over Little Caesars in a popular TikTok video.

This social media buzz has contributed to a six percentage point increase in Casey's exposure to Gen Z over the past three years, based on engagement metrics. Brennan attributes this enthusiasm to years of delivering quality food and integrating into local communities.

Strategic Advantages

Casey's also offers a competitive price point, with a large pizza costing around $13.99, compared to roughly $20 for similar offerings from Domino's, Papa John's, and Pizza Hut. This value proposition is particularly appealing to consumers impacted by inflation. The company has managed to maintain lower prices despite rising operational costs. As smaller convenience stores increase fuel prices to cover expenses, larger chains like Casey's can leverage higher food margins to keep pizza prices accessible.

Geography plays a crucial role in Casey's strategy. Over half of its stores are located in towns with fewer than 5,000 residents, areas often lacking national pizza competitors. Brennan refers to this as "competitive distance," stating that about half of their stores operate without a significant national pizza competitor. This allows Casey's to offer a popular product in underserved markets.

Future Expansion

Casey's is now targeting Texas for expansion, a state with approximately 30 million residents, which represents a consumer base ten times larger than its home state of Iowa, where it operates 550 branches. Brennan views Texas as a key growth market, calling it "Casey's country."