Domino's digital volume keeping prices down

 
July 24, 2014 | by Nicole Troxell

Domino's Pizza reached over $1 million in sales in the first four weeks of the launch of its iPad app, according to a company announcement.

Since then, the company has amped up its digital initiatives with an iPhone and Android voice ordering app called Dom. In the first quarter, the company debuted its group ordering tool online, which helps customers determine how many pizzas may be needed for a large group. 

Domino's also introduced a responsive screen that changes page layouts to fit desktop, laptop, tablet and mobile screens. During the company's earnings call earlier this week, CEO J. Patrick Doyle said technology is a core part of its global strategy and contributed to Q2 traffic and ticket growth.

Digital initiatives have risen to nearly half of total sales, with 45 percent coming through digital channels. Of that, 20 to 25 percent come from mobile and 20 to 25 percent come from desktops or laptops. On the international stage, Domino's digital sales growth has been slower than at home, at 40 percent on average. However, some markets, including Australia, Japan, Korea and the UK, have experienced 50 percent or greater digital sales and continue to grow, according to the company.

Digital has contributed to volume growth, and due to these increases, the company has determined it will not raise prices despite the rising cost of cheese and pork. 

"The volume growth has offset those increases in food costs. They've taken a little bit of the price, which we think was appropriate, but not a lot. And so that’s keeping the order count growth going." Doyle said.

The company will also continue one of its signature promotions, two medium, two topping pizzas at $5.99.

"Two medium two tops for $5.99 have been our primary promotion for four plus, almost five years now, and clearly it's done very, very well for us," he said. "We like the fact that we've been able to be consistent with that because frankly it means that the price isn’t the news. What we're doing with the brand really becomes the news."


Topics: Cheese , Domino's Pizza , Franchising & Growth , Marketing / Branding / Promotion , Online / Mobile / Social


Nicole Troxell / Nicole’s work has appeared in business, education, technical, and travel publications. She is currently the editor of KioskMarketplace.com and SelfServiceWorld.com.
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