Dominos Marketing Strategies And Technology Commerce Essay

Dominos Marketing Strategies And Technology Commerce Essay According to Dominos corporate website (2010), Dominos pizza was founded in 1960 by Tom and James. It was bought and started as a small pizza store in Michigan. With $500 as initial investment, Tom joined forces with his brother and together they opened a pizza delivery store in Ypsilanti, Michigan. Initially it was known as Dominicks. As Monaghans operations grew, the original owner of Dominicks decided to maintain rights to the name. Under deadline for a Yellow Pages ad, driver Jim Kennedy came up with the name Dominos Pizza. The three dots of Dominos the fact that Tom initially started 3 stores. In February 1968 a fire accident took place in Monaghans original pizza store. Advertising manager Bob Cotman had a narrow escape from the building, climbing down a firemans ladder. Although the pizza shop started operations within two days, Dominos lost stored goods worth $40,000. (information from the UK site (2010). The staff pulled together, with each existing store location responsible for producing one pizza item cheese, dough, chopped toppings which drivers then ferried from one store to the next to keep operations running. After that a very difficult situation arose that he had to cover not only the total fire losses of $150,000, of which only $13,000 were paid by insurance but also had to pay leases of five new franchises and recruit five new store operators as soon as possible. In 1975, the trademark lawsuit was launched by Amstar against the company. Furthermore, they started preparation to launch themselves on an international scale. In 1989, the Dominos Pizza changed ent irely when the Deep Pan pizza was launched for the very first time in twenty five years as the company had the urgent need for reacting to market demand. This step proved vital in providing strength to the financial foundation and made certain the growth of Dominos Pizza because they started operating their five thousandth store. The chain of Dominos Pizza grew quickly as they were operational in all varied places. Despite Dominos Pizza grew up at diverse locations and started doing good business, they were still a very traditional company. (History of Dominos pizza) Tom retired in 1998. He was the one who expanded Dominos chain around the world making it the worlds largest pizza delivering company known for quick service restaurants around the world. In addition, he gave majority of the $1bn earned through the sale of Dominos to charity. Marketing Strategies In 1973, Dominos Pizza introduced the policy that customers must be receiving their pizzas not later than 30 minutes of placing their orders, or if not they would take delivery of the pizzas free. The guarantee was condensed to $3 off in the mid 1980s. In 1985, Advertising Age placed Dominos ad among the fastest-growing money makers in the restaurant industry. The company had to keep pace not only with its own growth but also with that of its competitors, including the industry leader, Pizza Hut, which had more than 4,000 units to Dominos 2,300.In the previous year, Dominos spent 249% more in advertising, media. On the other side, the biggest threat for Monaghans empire entered in delivery business that is Pizza Hut in 1986. (Advertising age, Dominos inc. 1985) In 1992, the company settled a case filed against it by an Indian family whose lady was killed by a Dominos delivery driver. The company paid the family US $2.8 million. In 1993, Dominos settled yet another case in which the company was sued because a Dominos delivery driver ran a red light and collided with a ladys vehicle. The woman was paid almost US $80 million. The guarantee was dropped the same year because of the public perception of reckless driving and responsibility, according to Monaghan.(Founder of Dominos) Dominos Truck Kills 2 En Route to Delivery, (Chaudhury,1998) In December 2007 Dominos introduced a new slogan, You Got 30 Minutes, sticking to the earlier promise but getting short of promising delivery in a half hour. (Dominos corporate website 2010) In addition to this, Dominos changed their menu in 1992 and introduced for the very first time a non pizza item to their menu. Being Domino Pizza already on hand, the making of bread sticks was not so different which was the introduced item. The company kept on advertising for many years that if the delivery of their pizzas took longer than 30 minutes, the pizza would be delivered at no cost. This was also copied by the Ninja Turtles movie and cartoons. The benefits to Domino Pizza were enormous as millions of kids heard the name of Domino Pizza out of their favourite cartoons and they were the prospective customers. In 1993, Domino Pizza discontinued this policy and came up with a new one stating that if a customer was unhappy he could on his will have a new pizza or a refund. By 1994, Dominos Pizza marketing policy winded and they introduced chicken wings also in to the menu. Not only this, the company hit the African market as they opened a new store in Egypt. 1996 was the year when Dominos Pizza website was launched. That year the company declared global sales to be nearly $3 billion. In the 1980s, Dominos Pizza was well known for its advertisement campaign featuring The Noid. (Dominos corporate website 2010) In the same way, the Super Bowl Sunday was the most hectic and very busy pizza delivery day of the year and Dominos Pizza sold over a million pizzas, which was forty-two percent more as compared to normal Sunday trading volume. According to Dominos marketing director Robin Auld (Noelle McElhatton, marketing director management) Dominos franchisees pay a 5% royalty of their net sales into Dominos National Advertising Fund (NAF). Thats centrally managed and used to maximize sales and grow brand awareness. He said door-dropped menus are very effective for prosperity of ordering pizza and we use news paper and royal mail. Dominos also launched new offers that can be ordered by national hotline (087 12121212), in-store and online at www.dominos.co.uk. or SMS ordering system, which was the first time in UK in 1999. The Dominos text service requires only five minute initial online procedure. Firstly customers register and create their favourite menus giving them each an easy to remember name, delivery address and mobile number for order. Secondly, the chosen menu is typed directly from mobile phone. Customer can put their credit card details while registering so that they can use their card when they order and pay with cash upon delivery. In February 2003, the company announced multiyear partnership with the National Association for Stock Car Auto Racing (NASCAR) through which Dominos became the Official Pizza of NASCAR. According to news paper article (Detroit News, March 26, 1997) Dominos delivered $2.8 Billion in world wide sales last year. By 2011 the value of the home delivery food market was estimated to have reached  £1,474 million in the UK and expects to grow 30% to  £1,918 million. At Dominos Pizza, the values are summed up in a chant thats sung in the Sell more pizza, have more fun! DPZ Dominos Pizza Inc (NYSE)   12:00 AM ET, 03/04/2010     Last:  13.70   Change:  -0.36   %Change:  -2.56%   Volume:  2,982,700  Ã‚     Open: 14.06     High: 14.06     Low: 13.36     Previous Close: 14.06     Market Cap: 805.0M     Shares Outstanding: 58.8M     EPS: 1.38     52wk High (3/3/2010): 14.13     P/E Ratio: 9.93     52wk Low (3/9/2009): 5.61     Dividend: 0.00     Dividend Date: N/A     Yield: 0.00     Average Volume: 572,000.00   Figure 1 : Marketshare (Dominios corporate website) Financial information Dominos Pizza UK IRL plc financial results.[1][9][11][12] Year to December1 Revenue ( £Ã‚  million) EBIT ( £m) Net profit ( £m) Earnings per share (p) 2008 136.0 22.5 15.7 10.9 2007 114.9 18.3 13.2 8.4 2006 95.0 13.7 10.0 6.2 2005 81.7 10.4 8.3 5.1 2004 74.2 9.1 6.7 4.1 2003 61.6 6.0 4.6 2.8 Note 1: Accounts to 2005 prepared according to United Kingdom Generally Accepted Accounting Principles. Accounts from 2006 onwards prepared according to International Financial Reporting Standards. Figure: 2 Performance of the Dominos pizza 2007 2006 2005 2004 2003 2002 2001 System sales ( £m) 293.6 240.1 200.7 174.3 142.3 118.9 98.4 Stores at start of year 451 407 357 318 269 237 215 Stores at year-end 501 451 407 357 318 269 237 (Dominos corporate website) Figure: 3 SWOT ANALYSIS STRENGTHS 3,500 global operating franchises in over 50 countries Well-built brand equity maintained by intense marketing campaigns Effective supply chain distribution network  with fast operations WEAKNESSES Slow further growing and decreasing existing-stores sales OPPORTUNITIES Growing presence in emerging markets, particularly in India, China Leverage supply chain distribution system to introduce new products   THREATS Ever-changing consumer food tastes Adverse effects due to foreign currency Tough multi-national competitors Hard competition with local pizza shops and small chaons Conclusion Like any other thing, there is a positive as well as a negative point and the negative point of Dominos is that it can be a burden on ones finances. The large pizzas can have a price of  £14.99. The side orders also can cost on average  £4 each and that in anyways not cheap. Occasionally, there are offers introduced by Dominos.   However, one can say that dominos is great because the food is fresh and always warm when delivered and the taste is fantastic. The group invests a lot of time and money in upholding the positive reputation of their brand and has remained successful quite a lot. Dominos brand marketing activity is financed through a National Advertising Fund (NAF) which is made up of franchisee contributions. Dominos pizza sells hot and freshly backed. There is neither a deep frying nor for any forms of cooking like baking on a gas-fired conveyer oven. Furthermore, Dominos believes to meet strict quality standards to ensure food safety measures that meet or exceed any applicable government guidelines and that is the reason it has come forward as a strong competitor of pizza hut and has outclassed it in many countries. Today there are over 8,000 Dominos Pizza stores in more than 50 countries, employing over 145,000 team member and involving over 2,000 franchisees. Globally Dominos Pizza delivers more than one million pizzas every day. So, it equates 25 to 30 part time or full time jobs in every new store. In the same way, conc ept of home delivery means its reduce noise of store and traffic. Bibliographies History of Dominos available from htpp://www.Dominos uk.com [Accessed June 22, 2010] Financial data available from http://Dominos_Pizza_UK__IRL and http://www.domino-s-pizza-inc#cite_note-19 Dt: 21-Aug-09 [Accessed June22, 2010] http://www.brandrepublic.com/Discipline/DirectMarketing/News/926816/Britains, Interviewed with Dominos marketing director Robin Auld [Accessed June 22, 2010] QSR Magazine, (27January 2006) Dominos pizza delivery in 8000 store.(Accessed June 22, 2010) Dominos Delivered $2.8 Billion in Worldwide Sales Last Year. (Detroit News, March 26, 1997.) Dominos Truck Kills 2 En Route to Delivery, (Chaudhury, 1998 Nations Restaurant News, August 29, 1988.) (Accessed June 22, 2010) Hume, Scott, and Raymond Sera fin, Dominos Burned Up Over Pizza Hut Spot, Advertising Age, January 7, 1991. (Accessed June 22, 2010) Food information from http://www.recipepizza.com/the_history_of_dominos_pizza.htm Dominos Franchises information available http://www.dominos.uk.com/franchising/ Dominos Information available from http://www.domino-s-pizza-inc#cite_note-19 httpp://www.dominos.co.uk.