How Domino plans to interrupt the meals supply increase
Though Domino & # 39; s Pizza didn't know, the Michigan-based company has been preparing for a pandemic for years, investing in online ordering, contactless delivery, and roadside collection.
Now these investments are paying off.
In the quarter ended September 6th, US revenue increased 17.5%, according to the company. Total revenue increased to $ 968 million, exceeding analyst estimates made by S&P Global Market Intelligence.
At the same time, demand for grocery delivery apps like Grubhub, DoorDash and Uber Eats skyrocketed after the Covid-19 outbreak and subsequent lockdown measures. Consumers have never had more options to eat at home, but despite this increasing competition, Domino & # 39; s has succeeded.
To fight back against the rising tide of grocery delivery services, the chain launched a campaign aimed at competition. Behind the scenes, it remains committed to controlling customer data and turning to an agency model to keep up with the pace of change.
A rush for delivery
As sales increased, Domino's competitors positioned themselves better in the food industry to meet demand. DoorDash, whose sales rose more than 225% to $ 1.92 billion in the nine month period ended September 30, was traded on the New York Stock Exchange this week. In June, European grocery delivery company Just Eat Takeaway agreed to buy Grubhub for $ 7.3 billion. More recently, Uber has completed the acquisition of Postmates delivery service for $ 2.65 billion, a deal originally announced in July.
Figures from data analytics firm Earnest Research, which tracks credit and debit card transactions, show US adults spend twice as much on third-party delivery services in April than they did in the same month last year, and have continued to use them at an increased rate since.
Other forms of bringing pizza to people at home also heat up. Philadelphia-based delivery service goPuff, which delivers housewares from snacks to detergents to 500 cities across the country, reports that frozen pizza sales are up 139% year-over-year.
The dominoes game book
Over the past decade, Domino has built its reputation as a supplier through extensive marketing efforts. Long-time agency partner Crispin Porter + Bogusky (CPB) created ads for the pizza tracker, delivery hotspots, delivery insurance and the chain's AnyWare initiative, which allows dominos to be ordered from virtually any internet-connected device. Although the DXP (Delivery Expert) vehicle, an innovative machine with a built-in oven, could only be used to a limited extent, it was able to consolidate the brand's status as a delivery company through its appearances in commercials.
Despite past success, Domino recently ended its 13-year CPB relationship and appointed the independent agency WorkInProgress in Boulder, Colorado as its new agency.
During a meeting with analysts on November 12, Dominos CMO Art D & # 39; Elia, who took over his current role in July, discussed the company's need for a swift transition to the new agency in early 2021.
"One of the things that we all learned during this crisis, but certainly were a trend in marketing before the crisis, is that consumers will accelerate faster," explained D & # 39; Elia. "We want to continue to be able to implement marketing initiatives and campaigns faster."
D’Elia believes the smaller WorkInProgress is better suited to "getting more news to consumers faster than in the past".
However, don't expect Dominos News to undergo a drastic change itself. WorkInProgress was founded by veterans in CPB's account who have a deep understanding of the brand, and their earlier time with the brand appeared to coincide with the tenure of Domino's US President and Chief Operating Officer Russell Weiner as Domino's CMO.