The Dominos’s story starts in 1960 when two brothers Tom and James Monaghan bought a a small pizza store in Michigan named Domi-Nick’s for only $900. After operating the business for only 1 year, James sold his half of the business and left Tom as the sole owner, who in 1965 renamed the business to Domino’s Pizza, inc, the name which is still used today. The Domino’s business began franchising almost immediately and by 1978 had 200 stores across the United States.
In 1983, after 20 years of expansion in the U.S, Domino’s opened its first store in Australia. Since then, the branding rights for Domino’s in Australia were sold to a domestic company who have since steadily grown the Domino’s distribution network and now has ambitions to expand to over 900 stores in Australia in the near future.
It is important to note that although all Domino’s stores in Australia are franchised, most of the marketing activity is driven through national campaigns. These campaigns allow head office to maintain consistency in the brand messaging when communicating to the consumer. In the Fast Moving Consumer Goods (FMCG) market such as the made-to-order pizza market, having a clear message is crucial as it helps support a “pull” distribution strategy. When an organisation adopts a pull strategy, consumers are actively pulling the product from the supplier and directly control the consumption velocity of each product.
By having each store create and cook pizzas at the time of order, they become both the manufacturer and retailer of the product. This significantly reduces the chance for any conflict in the distribution channel.
Domino’s distribution strategy is quite unique as they have recognised that in this market the distribution of the product can be in two very different ways;
When a consumer selects Pick-up both the creation and distribution of the product is conducted in their mind at one location – in-store. This is a reasonably simple distribution method for the store as the consumer comes to a specific location and transacts at that point.
Delivery however, is a different product offering all together and Domino’s has recognised and innovated in this area. It is crucial to ensure that the brand experience Domino’s have created for Pick-up orders is also felt through the delivery channel. By bringing brand, product and customer experience together Domino’s has introduced initiatives such as the driver tracker program which allows consumers to track their order from the store to their location.
DRU and the focus on delivery orders epitomises how Domino’s understands the consumer’s needs in relation to convenience. The introduction of a 15 and 20 minute service guarantee for an extra 3 dollars, demonstrates the cost trade off they present to the consumer in this area.
It is clear that Domino’s continues to be at the forefront of the fast food industry when it comes to distribution of their products. They are continuously striving to develop new methods of engaging with their consumers in a convenient way whilst not compromising on their core values.
Deakin ID: 900209063