Domino’s where its pizza is going

dru-image-11

DRU – Domino’s future delivery robot

Domino’s (formerly Domino’s Pizza) is one company that has used innovative apps and technologies to improve the way it gets its products to its customers. Domino’s is currently the leading pizza chain in Australia and has transformed its position in the market by its “use of technology to sell pizzas in a way no other food retailer has been able to emulate” (Vesely 2016).

Part of its current success comes from its use of a GPS driver tracker that allows both the customer and store through the use of an app the ability to track a driver’s path from store to its eventual destination (Domino’s Website).This communication between buyer and seller is an example of distribution channels which are firms that work together to get products to where customers need them (Iacobucci:127). This use of technology enhances the service to both seller and customer to ensure timeliness and transparency through these channels. Not only this a customer can order food through the dominos app which once an order is placed the customer can see what stage their order has been processed from being made to being ready in store.

Channel relationship dispute between Domino’s and Precision Tracking

 

The use of online services or apps to make orders is a valuable channel because it provides a better service that saves time and money for both buyer and seller and is more convenient and efficient i.e. Stores don’t have to answer calls, less customer waiting time, easier to track orders and store data, payments can be paid online (through credit card or Paypal). In this case Dominos have channel relationships with providers like Paypal who can process online payments and Speedwell who have created their online apps. Many of Domino’s promotions are targeted solely to online customers and are not available through other channels e.g. pizza discounts, 20 min delivery etc. Domino’s CEO Don Meij admits the company want to streamline ordering to a single interaction and the company are currently using SMS ordering as another way to make ordering food as simple as possible (Domino’s Website).

Uber is another service that has really shaken things up in the taxi industry because it has shown how the use of apps and new technologies can improve existing logistics and distribution structures. Uber’s use of GPS technology enhances their service because you know the location of their cars, how long they will take to reach you as well as estimating costs and not having to call them.

 

Because Domino’s is a large scale franchise and is selling a relatively low-end product it would look to distribute its product intensively (Iacobucci:130). Because the product is simple and fairly inexpensive it would require a large volume of stock distributed through its various franchises to make profits. When a company can make enough profit through franchising its stores it makes it easier to fund all of its operations through economies of scale e.g. advertising costs, buildings, store operations, research and development etc. (ibid:139) This is where the company have excelled because they have invested their profits on innovation through easily accessible apps and ordering channels but also aggressively promoting their services through integrated marketing.

The company’s use of pull strategies are particularly noticeable compared to other fast food chains where I live (Geelong)(ibid:131). Every week I receive direct mail promotions (even free pizza’s/50% off deals) making me fully aware of the company’s presence not to mention their TV advertising and email marketing. This is far more than any other marketing I receive from other local fast food stores. The importance of direct mail marketing is emphasised in a case study by Australia Post (a company partner) who note that although online sales make up about 50% of sales customers interact more with direct mail promotions which have a higher response rate. These are important because franchisees in regional areas notice a direct drop in sales if mail is not delivered to these customers. Online emails can be more easily ignored but are still important because they are part of an integrated marketing strategy that show how different channels can impact sales but how they can work together to fulfil different customer needs (Australia Post).

 

 

References:

Australia Post, 2012, ‘How we helped deliver Domino’s Pizza direct to your post box’, Retrieved 16 May 2016 <auspost.com.au/media/documents/aus-post-case-study-dominos.PDF>

Domino’s, 2016, ‘Hungry? SMS your pizza order to Domino’s’, Retrieved 16 May 2016 <https://www.dominos.com.au/inside-dominos/media/dec-2015-hungry-sms-your-order-to-dominos>

Domino’s, 2016, ‘Inside Domino’s, Retrieved 16 May 2016 <https://www.dominos.com.au/inside-dominos&gt;

Fenech S, 2015, ‘How you can track your Domino’s pizza from the oven to your door’, Tech Guide, Image, Retrieved 16 May 2016 <http://www.techguide.com.au/news/apps-news-feed/how-you-can-track-your-dominos-pizza-from-the-oven-to-your-door/&gt;

Iacobucci D, 2014, MM4, Cengage Publishing, p.127, 130-1, 139.

Jager C, 2016, ‘Domino’s Is Launching A Self-Driving Delivery Robot. No Really.’, Lifehacker, Image, Retrieved May 16 2016, <http://edge.alluremedia.com.au/m/l/2016/03/DRU-Image-11.jpg>

 Vesely E, 2016, ‘3 shares you’d love to buy but shouldn’t’ , Retrieved 16 May 2016 <http://www.fool.com.au/2016/05/09/3-shares-youd-love-to-buy-but-shouldnt-2/&gt;

 

Aston Northfield

900168086

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