TABLE OF CONTENTS
CONFIDENTIALITY AGREEMENT..................................................... 2
AUTHOR CONTACTS............................................................... 2
TABLE OF CONTENTS............................................................. 3
EXECUTIVE SUMMARY............................................................. 4
BUSINESS BACKGROUND AND FINDINGS.............................................. 5
CONSUMER EXPERIENCE MAP AND FINDINGS...........................................8
CONSUMER REAL VIRTUAL EXPERIENCE...............................................10
CONCLUSION.....................................................................12
REFERENCES.................................................................... 14
EXECUTIVE SUMMARY
The United States
has a very wonderful pizza restaurant chain, neither the single-minded research
and development pizza products, nor minded the store experience to achieve the
ultimate. It was able to miraculously become the world’s second-largest pizza
restaurant chain. Domino means: they want the business can develop as dominoes
knock-on effect. In the report, I would like to share Domino’s unique business
model – not focus on products but involve in advance technologies innovation
with creative marketing ideas; Domino’s use social networking and digital tools
to engage with consumers, and how these help it solve the public relations
crisis; after review the feedback of Domino’s three loyalty customers, probably
Domino’s success keys could be revealed, it’s an unique company with an ahead-thinking,
forward-looking and industry market insights to improve customer experience and
enhance customer’s loyalty.
BUSINESS BACKGROUND AND FINDINGS
About Domino’s Pizza
Domino’s Pizza is
multinational’s pizza delivery chain, headquartered in the United States,
Michigan in Ann Arbor, founded in 1960. It is the outside world recognized
pizza in the United States and international markets operates a network of
company-operated stores and franchises constituted. Domino’s Pizza’s vision
revealed the company’s outstanding employees with the mission – to be the
world’s best pizza delivery company outside. Domino’s Pizza is the world’s
leading pizza chain brand and has operations in more than 80 countries and
regions, more than 13,000 restaurants and the annual income is $2.2 billion in
2015 (Domino’s, 2016) and entered into New Zealand market in 2003.
Unique Business Model of Domino’s
Pizza
From the product
point of view, as an American-style pizza, it is neither tenacity delicious as
Italian handmade pizza, nor aftertaste as cracker pizza. From marketing,
Domino’s Pizza focuses on take-away business model, neither focus on new
product development as Papa John’s, nor emphasize store experience as Pizza
Hut. However, it realized 22 years of continuous growth, the stock market rose
by 50 times.
Why concentrate
until a development is neither pizza nor the experience to achieve the ultimate
storefront pizzeria, would be so crazy?
First, focus on takeaway areas, store marketing only 20%
Up to now,
Domino's Pizza is 80% sold by the takeaway, and 20% rely on offline stores. In
the United States, 90 percent of the pizza delivery market is Domino's
occupation, while the offline stores more play is a showcase platform (CMO,
2016).
What makes
customers more willing to order the takeaway pizza of Domino’s? And rarely book
competitors’ pizza? The answer is: fast enough! Since 1973, Domino's
made a special slogan: “30 minutes served, otherwise free"
(Mitra, 2013).
Domino's thinks,
due to the low barriers of doing take-away business, only faster serve can
support the company to be more stable in the market. 30 minutes is the
people's psychological endurance pole and deliver the pizza to customers within
30 minutes is the fast standard.
Therefore,
Domino's stores in every location are extremely accurate, detailed analysis of
the surrounding main takeaway consumer groups, communities, streets, roads,
etc., and stores in the area carefully plotted in detail to the position of
each intersection and traffic lights in order to find the best takeaway
delivery route.
During this
period, staffs and managers of stores will work together to optimize the
planning of takeaway route. Specified delivery time is 8 minutes per takeaway,
reserved for 7 minutes to prepare the traffic jam or any accidents. More than
99% of the Domino's Pizza can be delivered within 30 minutes.
Second, not only sell pizza, but will itself into an IT company
As a pizza
company, the largest department is neither the R&D which develop and taste
the pizza, nor the marketing department, the largest one is the IT department. Even
Domino's marketing director has joked: "Domino's is actually a technology
company, but it just selling pizza." (Pathak, 2015)
Why sell a
traditional pizza business will turn into an IT company?
Domino's said: the
traditional business model of take-away is answering phone orders, and delivery
food is a physical work, all of these are do not have the competitive strengths.
When imitators are booming and diving into the market, Domino's advantage will
not be able to keep. So they began to invest large sum of money in the high
technology, and leverage technologies to maintain its core competitive
advantages.
For example: In
2007, when other pizza companies are answering telephone orders, Domino's
introduced the computer and a mobile terminal ordering page, customers can
order food online directly.
In April 2012,
when the UAV
(Unmanned Aerial Vehicle) just popular, Domino's UK subsidiary began to
experiment with UAV delivery.
In 2013, the
United States began to launch of music robot food delivery service.
October 2015,
Domino's has introduced pizza car - DXP, it usually traveling in every
stronghold. When a customer places an order, the final processed food can be
completed directly in the car, and sent food to customers more quickly (NDTV,
2016).
In March this
year, Domino's launched a new delivery robot which is the world’s first
automatic pizza delivery robot and New Zealand becomes the first country to try
it. (Sachdeva, 2016)
Technology is
changing people’s habits, which generate the market gap. A quote from Domino’s
executive: Domino’s did not create the demand, it just creates customer
experience and appreciate customer to accept these kind of experience
continually. The use of combination of technologies and digital, Domino’s can
perform well in the field of the convenience of ordering, customer satisfaction
and data evaluation on its capability.
The industry
believes that, Domino’s is a technology company, just happened to selling a
pizza. The engine of its development is leading new technologies, new
experience, new tools and new creative ideas. Whether Domino’s wants to sell
burgers or burritos in future, it is not a problem seemingly.
CONSUMER EXPERIENCE MAP AND FINDINGS
Digital Customer Experience of Domino’s Pizza
Domino’s used not only
in scientific and technological means to enhance customer experience on
ordering benefit, but also to build-up an amazing image in the most active
social medias: it is often made a number of “appalling” and “fanciful” topics
in social medias, even said to open branches on the moon, “customer can enjoy
the earth sights when eating pizza.” (Ryall, 2011).
First, enhance customer experience via social medias
Domino’s delivery
of unmanned aerial
vehicles and posted” movement. Domino’s once sluggish sales in the UK market,
it launched a random drone delivery service in London. Many young people want
to be served pizza via UAV, so the UAV become the master and be the focus of
everyone’s expectations. Many lucky guys will take a photo with the delivery of
unmanned aerial vehicles when enjoying the services of UAV, and upload to
Facebook. Within months, Domino’s fans rose 100,000, sales rose by 12%
(Youtube, 2013).
“50 million people
involved in the production of social Pizza” contest. Domino’s has launched the
production of social activity on Facebook. Customers can vote “social Pizza”,
from bread, sauces, vegetables, and any step of the production chain.
Ultimately, this “social Pizza” has placed in menu. And the advisors whose
opinions were adopted has owned thousands of dollars as prize. The event
attracts hundreds and thousands of fans to participate in interactive.
“Fun social
interaction with discount” activities. Domino’s Japan branch to promote a
discount activity – customers can receive discount coupons once they finish a
task, the tasks are: keep a beard, or tie pigtails, even or speak a local
dialect. Once complete it, just shared on social networking and a coupon will
be delivered to the customer. There have been the abundance of strange instant online
cute videos and pictures and became a hot topic on social networking.
“Free weekly
pizza” activities. Domino’s fans are strongly encouraged to recommend friends
to join Domino’s business community, every Friday 17:00 the recommendation king
could be elected to acquire free pizza. Weekly Domino’s will host a variety of
incentive programs to return customers.
“Share friends,
get commission” activities. Domino’s American branch have had such an event: to
share their predetermined pizza page to a friend, or share personal page or
space, and if the friends order the pizza via these channels, the sharer can
get a small proportion as commission from the order of the friends.
In 2009, Domino’s
appeared in the history of its very serious crisis. The dough slapstick of two
employees in Houchu was released, the video
uploaded to the network quickly and caused an uproar (York, 2009). The video
sparked consumer boycott and the criticism of Domino’s overwhelmed overnight.
At that time, Domino’s neither to write public relations draft, nor to carry
out the disposal of the decision immediately, it only did two things:
First, Domino’s
CEO rented electronic screen at Time Square, all the dissatisfaction and
complain loop on the big screen (Wasserman, 2011). The commentators of industry
believed Domino’s CEO already lost the capability of control market. Script,
videos, pictures emerged constantly and became a social hot topic in several
days. Later, consumers discovered that there were a lot of funny jokes and
slowly began to compete who released funniest scripts. As the result, the
crisis turned into a mass entertainment.
At this time,
Domino’s CEO made an official apology and explained that Domino’s executive
level listened and acquired consumer voice through the electric screen and
social media, determined to change the 50-year old flavours. Welcome consumers
to taste and feedback the suggestion for further improvement (Gregory, 2009).
This strategy resolved
Domino’s public relations crisis, Domino’s stock price soared 40% in short
time, brand awareness was increased unprecedentedly and sales of stores grew of
750% (Agnes, 2012).
Until now,
listening customers’ feedback is Domino’s retention project. “Think
Oven” project is to let consumers appraise and evaluate company directly on
Twitter, Facebook. Domino’s constantly collecting feedback via social media, some
new ideas, complaints, feedback are collected by a dedicated person to review
and analysis, some new marketing promotion ideas and inspiration are come from
here. Domino’s leverages instant social media, encourages the
interaction with customers, especially increases consumer viscosity and loyalty
to extend distribution.
As
described above, Domino’s leverages new technologies and digital tools to
provide the completely different consumption experience for its customers, not
only increase sales revenue and enhance customers’ loyalty, but also improve
the brand influence and extend its marketing sharing. Here, to see how three
customers to evaluate Domino’s.
First Interview:
Interviewee: Mr. Godfrey
Occupation: Project Manager
Interview
Mode: via phone call
Q: Do you
often choose Domino’s for online ordering?
A:
Actually I am Domino’s loyalty customer more than 10 years and almost order
pizza, snack and drink every week. I prefer to place order via my mobile’s
Domino’s app, it so easy to handle with the friendly pages.
Q: Why do you choose Domino’s?
A: As you know, I am a project leader and our
team should meet together to discuss the projects process in every Wednesday
morning. If the meeting couldn’t finish till noontime, Domino’s pizza is our
best choice, because usually Domino’s is the most convenience, time-saving and not
affect work in meal time.
Second Interview:
Interviewee: Carmen
Occupation: Housewife
Interview
Mode: via phone call
Q: Do you
often choose Domino’s for online ordering?
A: Yes,
Domino’s food is one of my family favourite food – my kids really like fries
and chips, and chicken wings are my husband’s favourite. I usually order
Domino’s food via internet two-three times per week, their website’s design is
so convenience for order.
Q: Why do you choose Domino’s?
A: Although I am a
housewife, every day I am going to participate community activities and also to
take my kids to join some extracurricular event, sometimes come back home so
late. In this case, I will place the order via internet and book pizza, snacks,
they will be sent within 30 mins, so the family will not have dinner too late.
And sometimes, I invite friends to my home and Domino’s food can help me
entertain them very well. Domino’s often do some marketing promotion programs,
since I am loyalty customer and always can receive some coupons or if they
organize some related promotion, I will be noticed via email. I like this kind
of marketing approach, it’s so friendly.
Third Interview:
Interviewee: Andy
Occupation: Builder
Interview
Mode: via phone call
Q: Do you
often choose Domino’s for online ordering?
A: I quite
often place the orders through Domino’s mobile app, sometimes I also order via
internet. I am Domino’s funs and participate their Facebook and twitters.
Q: Why do you choose Domino’s?
A: I am a single
and work at Auckland as builder, usually so busy and tired after work. Domino’s
food can solve my dinner within 30 mins after place the order and with a
steaming hot pizza, snacks, I love hot food. I have been added to Domino’s
Facebook and Twitter in 5 years ago and have been focused on its performance
from that time. Based on local tastes, I always post some comments and
suggestions in these social networking. Moreover, if Domino’s launches some new
products, I would order and taste at first time.
CONCLUSION
Domino’s
is a precise positioning of its products, understand if they want to win
business, sometimes speed is more important than taste. It is so interesting
position in the industry. Pizza is one kind of food between a snack bar and
official meals, most restaurants can do not taste much worse. In this status,
it’s very important to find a quick, easy, simple position in the industry
market. According to customer research in the market, Domino’s intends to
increase investment in internet, mobile applications, digital interactions to
optimize customer experience. Meanwhile, Domino’s manages fairly social media
to crease spread of information and contents when it launches new products,
fully leverage the features of social networks and the internet functions. Accepting
negative feedback from customer and using the internet, social media to reduce
harmful effect are the best publicity strategies for the market positioning and
customer ethnic groups.
Meanwhile,
Domino’s biggest advantage is not speed of takeaway, not IT innovation, not
creative marketing and sales, but its ahead-thinking, forward-looking and
market insight. When rivals are focus on expanding stores in market, Domino’s started
doing takeaway; when rivals focus on how to improve customer service of answer
customer phone calls, enhance delivery efficiency, Domino’s started delivering
food orders via internet; when rivals focus on accepting orders via the
internet, Domino’s started to use new advanced technologies as much as possible
to improve customer experience.
Domino’s
implements a principle: “others haven’t, I have; others have, I am expert;
others are experts, I am professional.” Doing faster than others is the path to
excellent performance of Domino’s.
REFERENCES
Agnes, M. (2012), Domino’s Pizza: a look at the timelessness
of a social media crisis plan. Crisis Management Strategist. Retrieved
from: http://melissaagnes.com/dominos-pizza-a-look-at-the-timelessness-of-a-social-media-crisis-plan/
Chief Marketing Officer (2016), How
did Domino’s make a miracle? Retrieved from: https://www.fooads.com/post/573effdfd24e6d6224748044
Domino’s Official Website (2016), Domino’s 101: Basic Facts. Retrieved from: https://biz.dominos.com/web/public/about-dominos/fun-facts
Gregory, S. (2009), Domino’s YouTube Crisis: 5 ways to fight
back. Time. Retrieved from: http://content.time.com/time/nation/article/0,8599,1892389,00.html
Mitra, M. (2013), Domino’s adopts to deliver your pizza in 30
mins. The Economic Times. Retrieved from: http://economictimes.indiatimes.com/slideshows/corporate-industry/8-mantras-dominos-adopts-to-deliver-your-pizza-in-30-minutes/slideshow/19123621.cms
Pathak, S. (2015), Domino’s is now “an e-commerce company that
sells pizza”. Digiday. Retrieved from: http://digiday.com/brands/dominos-now-e-commerce-company-sells-pizza/
Ryall, J. (2011), Domino’s plans pizza on the Moon. The
Telegraph News. Retrieved from: http://www.telegraph.co.uk/news/science/space/8734456/Dominos-plans-pizza-on-the-Moon.html
Sachdeva, S. (2016), New Zealand could become first country to
use Domino’s pizza delivery robot. Stuff News. Retrieved from: http://www.stuff.co.nz/business/78022236/new-zealand-could-become-first-country-to-use-pizza-delivery-robot
Wasserman, T. (2011), Domino’s Pizza Runs Unfiltered Customer
Comments on Times Square Billboard. Mashable Australia. Retrieved from: http://mashable.com/2011/07/25/dominos-comments-times-square/#UboIXbbKmkqY
York, B.E. (2009), What Domino’s
did right and wrong. ADAGE. Retrieved from: http://adage.com/article/news/crisis-pr-assessing-domino-s-reaction-youtube-hubub/136086/
YouTube (2013), Dominos
DomiCopter - First Drone Pizza Delivery. Retrieved from: https://www.youtube.com/watch?v=ZDXuGQRpvs4
APPENDICES
Domino’s new
release in NZ: https://www.dominos.co.nz/inside-dominos/media
Domino’s technology and innovation in NZ: https://www.dominos.co.nz/inside-dominos/technology
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