Source: Admap, January 2017

Downloaded from warc.com

How Domino's repositioned itself from pizza delivery tomealtime solution

This article examines the journey undertaken by the UK branch of pizza brand Domino's as it reacted to the rise of brandsdisrupting the food delivery sector by reimagining itself as a digital-first mealtime solution.

As part of this rethinking of the brand, Domino's looked closely at what consumers would wish to buy from the companyand sought to build propositions against audience needs.Creating an app, allowing X Factor viewers to order direct through the show, and letting consumers save theircustomised pizzas were some of the innovations in Domino's successful expansion bid.By meeting the challenges head on, rather than waiting to see what the disruptors would do, the brand transformed itselfto one capable of competing for customers with the aggregators, creating a strong position for future growth.

Ben Esseniris

Domino's reacted to the new food delivery competitors by repositioning from pizza to a full mealtime solution forspecific occasions, days of the week and TV viewing events, with new products, an easy order app and a new socialmarketing strategy.

Marketing Food

This article is part of a series of articles on marketing food. Read more

Uber, the world's largest taxi company, owns no vehicles. Facebook, the world's most popular media owner, creates no content.Airbnb, the world's largest accommodation provider, owns no real estate. Add to that list Deliveroo, Just Eat, Grubhub,hungryhouse, UberEATS and the other aggregators disrupting the food delivery sector with the same digital differentiators ofpersonalisation, convenience and range. None of whom make any food.

As in so many digitally disrupted sectors, this new breed of brand has been adding to existing price pressures to put a squeeze onthe traditional fast-food and delivery companies. Ultimately, they have caused a shift in consumer expectations that helps enhancethe ordering experience, but commoditises the end product of the meal itself.

Domino's UK realised that the best way to meet the emerging technology threat was head-on – by itself thinking more like atechnology company. Domino's needed to become a digital-first brand that visibly enhances, enriches and positively participatesin the culture of mealtimes. The brand needed to embed itself in the lives of its audience by delivering not just pizzas, but feel-goodmoments.

The idea

The first step for the brand was to stop thinking about what it wanted to sell and instead understand what people wanted to buyfrom the company. The dominant marketing strategy in the fast-food sector has long been the 'product and promotions' approach– mass market, templated communications that promote new product variants, with support from regular discounting.

But what people are really looking for when they press the 'order' button is a solution. It's Wednesday night, it's been a tiring week,there's no food left from the weekend shop. It's Saturday night, the family should be spending quality time together but everyone isstuck in their screens. People don't just want pizza, but a solution to the problem of 'mediocre mealtimes'.

So instead of leading with product and promotions, the brand built propositions against the specific audience needs andoccasions that most required the Domino's solution. In effect, transforming from a pizza delivery company to a mealtime solutionscompany.

This meant a fundamental change in all aspects of the marketing mix, starting with the product. New product development focusedmore on whole meal solutions, including new drinks and desserts. Meanwhile, value-led 'pizza deals' were enhanced throughinsights into how Domino's unique combination of product, value and service could enrich occasions. These included the'Midweek Rescue', 'Winter Survival' and 'Big Night In' platforms.

The overall shift was from a strategy built around a fixed calendar of new pizza product releases, to one that flexed new products,services and communications around people, occasions and popular culture. The media strategy was recalibrated to becomeoccasion-led – focused on identifying the right-time, right-place opportunities to capitalise on 'pizza intent'.

We identified these opportunities by layering social insight over purchase data to determine specific passion points that alignedaudience interest, consumption occasion and brand narrative: football, gaming and weekend 'event TV' that brought the familytogether.

These rich, interest-led territories then empowered us to trial new experience propositions, such as allowing X Factor viewers toorder pizza directly from the show's app on a Saturday night, and permitting gamers to order from within the Xbox Live platform(the first Xbox app to enable delivery of a physical product). Domino's contributed to consumer culture around these passionpoints, through social content, topical PR stunts and events.

The strategy/campaigns

Fundamental to this whole approach was an expansion of the role played by marketing. Rather than just spending marketinginvestment telling people how good the product was, the marketing team invested in making it better – through a series ofcategory-breaking innovations which became service-led marketing propositions in themselves.

Significant product developments were introduced to alleviate pain points in the experience, such as 'Dom', a device that lets youtrack your pizza from order to arrival on your smartphone or Apple Watch. More than a piece of utility, Dom was a branded robotthat brought a distinctive Domino's character to the digital experience, such as by delivering meme-based content to heighten thesense of anticipation before the Domino's order arrived.

In a step to make pizza ordering even simpler, Domino's then developed an Easy Order Button that, far from being a PR stunt, was

a full-scale loyalty programme for influencers and high-value customers. Mobile users could download a 'Tummy Translator' appthat could tailor their pizza order to the sounds coming from their stomach. Domino's was the first pizza brand on Tinder, acting asthe perfect match for singletons for the twenty-four hours of Valentine's Day.

It even announced the world's first autonomous pizza delivery vehicle and a John Lewis-inspired delivery to the man on the moon.This blend of tangible product development and branded storytelling created the overall feeling of a brand constantly pushing theboundaries of customer experience.

The most significant and effective driver of growth has been the Pizza Legends social commerce platform. Pizza Legends is amobile-first platform that allows users not just to customise their own pizza, but to name it, brand it, tell the legendary story behindit, and make it famous within the Domino's League of Legends. Customers could order their friends' pizzas, vote for theirfavourites and see their own creations featured in advertising.

The platform was particularly effective in driving frequency, value and love from Domino's customer base. The value of a Legend is38% higher than a menu pizza and the platform has delivered a 44% repeat purchase rate.

Further, with over half a million Pizza Legends customised and 2.2 million YouTube views to date, the platform has also achievedpresence and penetration in the sector. One in every five Pizza Legends sold has been to a lapsed customer.

One of Domino's greatest success drivers has been rapid development and testing of a diversity of marketing solutions. But thedanger of such an approach is that it lacks a sense of consistency and focus. They needed an idea to make the whole greater thanthe sum of its parts, and add a sense of momentum and meaning to their diverse marketing output.

As part of the original audience scoping research, an ethnographic study found that strong emotional needs were experiencedaround take-away occasions. Domino's not only answered them but positively enhanced them. In consumers' words, Domino'smade mealtime experiences great.

'Greatness from Domino's' became the brand's mission to turn mediocre mealtimes into feel-good moments. This passionatepurpose became the glue that connected the brand's all-out commitment to innovation with a wider brand story.

The latest campaign tackles the familiar food sector topic of 'taste', but in a way that remains faithful to the emotional extremescaptured in the idea of 'Greatness'. The campaign's insight came from a bespoke piece of social listening that explored thelanguage currently used by pizza fans to describe the taste of Domino's pizza. We found that rather than using words, pizza loverswere expressing their response to Domino's through the emotive, visceral internet language of GIFs, memes, emojis and CapsLock. This led to the insight that 'Domino's is so overwhelmingly tasty that people are lost for words'.

The 'lost for words' platform combined meme-inspired TV advertising with a custom Snapchat filter and branded GIPHY channel,all built to help pizza lovers express how they felt about eating Domino's. Triggering 2.5 million GIF views and a Channel 4 parody,the campaign crossed over into popular culture to drive a 20% year-on-year uplift in net sales.

Results

The greatest lesson that Uber, Airbnb and the rest have taught us is that in a digitally powered age, the winner takes all. This hastended to mean a new challenger coming in, turning the market on its head and 'growth hacking' its way past the sluggishincumbents. But the Domino's story reminds us that it's also possible for an established category leader to itself pivot andaccelerate growth. The brand's accelerated performance since becoming a digitally powered participation brand has looked morelike that of a young start-up than an established franchise business and category leader.

Most importantly, the change in strategy has enabled the brand to shift focus from short-term, reactive sales spikes to consistent,long-term growth. Twelve consecutive quarters of double-digit growth have seen Domino's outpace the category, even as categorysales have grown post recession. The number of monthly customers served has almost doubled, from 1.3m in January 2013 to2.4m by December 2015, and the brand's share price has also doubled in this time.

Domino's has become a digitally driven business. While total sales have increased by 81% since 2010, ecommerce has becomethe engine for growth, increasing by 432% over the same period. By 2015, e-commerce accounted for 67% of all sales.

Mobile ordering, in particular, has increased dramatically since 2013. It is now Domino's single biggest sales channel – in 2015accounting for 48% of all online sales.

Econometric modelling shows that the 'Greatness' brand platform has driven year-on-year improvements in ROMI, making it one of

the key drivers of business growth. 'Greatness' communications have put an average of £284,000 profit back in the pocket of eachstore owner since 2013.

Learnings

Fight disintermediation by taking the digital disruptors head-on. It would have been all too easy for Domino's to waitand watch for market developments before deciding whether to invest in transformation. In difficult economic conditions,Domino's could have opted for consolidation, deciding its value existed in its retail stores, distribution network and coreproduct of pizza. By acting pre-emptively, the brand avoided handing its customers to the aggregators and effectivelybecoming suppliers in the distribution chain.Constraint can be the catalyst for innovation. As a franchise business, Domino's could only increase marketing spendin line with increased revenues. This has forced the brand to favour incremental, efficient experimentation over a heavyupfront investment in transformation. Trying to do more with less has taught it to be smarter, more agile and ultimately moreeffective.Keep the process simple and seamless. A consistent challenge has been the ability to combine agile innovation withbrand consistency. And the way Domino's has achieved this is through a tight, highly collaborative team. We at iris haveworked seamlessly with media partners Arena and the Domino's marketing team to create new solutions across an ever-widening range of channels and challenges. In a world where speed, efficiency and agility trump everything, it's this kind ofrole-swapping, hands-on team dynamic that can make the biggest difference of all.Blend utility, entertainment and value. Sometimes it can feel like a difficult choice for food brands: invest in distinctive,culture-shaping ideas that drive salience, or build innovative services that enhance the customer experience. Alternatively,do neither: focus on price competitiveness and offer straight commercial value. The Domino's story shows us that it'spossible – and optimal – to blend all three. Customer experience enhancements that give people value for their time andmoney alongside currency for their social networks. Because this is the magic formula that allows brands to embedthemselves in the lifestyle, culture and conversations of their audience.

About the author

Ben Essen is executive planning director at iris, where he started as planner in 2007. Before this, he worked at Leo Burnett andKLP Entertainment. He was the winner of the Admap Prize in 2015.ben.essen@iris-worldwide.com

Read more articles on marketing food

Marketing food: A matter of tasteColin Grimshaw

The six types of grocery shoppers who can shapeyour Big Food marketingPushpa Gopalan and Elizabeth Knapp

Eat it up: How experiences influence food marketingChris Marchegiani

How four grocery shopper types look at social statusthrough food buyingMarco A. Palma, David P. Anderson and Meghan L.Ness

Bring home the bacon: How food labels can distinguishthemselves in mega-categoriesNeil White and Scott Schraufnagel

Five tips to design grocery packaging that appeals on thesupermarket shelfRichard Taylor

The four steps tea brands must take to buck the downwardtrendNick Ward

How food brands can ensure their products launchsuccessfullyTim Eales

© Copyright Warc 2017Warc Ltd.Americas: 2233 Wisconsin Ave NW, Suite 535, Washington, DC 20007, United States - Tel: +1 202 778 0680APAC: 20A Teck Lim Road, 088391, Singapore - Tel: +65 3157 6200EMEA: 85 Newman Street, London, United Kingdom, W1T 3EU - Tel: +44 (0)20 7467 8100

www.warc.com

All rights reserved including database rights. This electronic file is for the personal use of authorised users based at the subscribing company's office location. It may not be reproduced,posted on intranets, extranets or the internet, e-mailed, archived or shared electronically either within the purchaser's organisation or externally without express written permission fromWarc.