Domino’s Journey to Digital Transformation

Domino’s Pizza started out in the 1960s as a small pizzeria by two brothers Tom and James Monaghan. Since then, Domino’s Pizza has grown substantially and managed to emerge as a synonym to pizza. Today, Domino’s has 16,000 outlets worldwide, with more than 290,000 employees.

The success of Domino’s Pizza can be attributed to their willingness to change and transform as needed. Digital Transformation has been a key element of their successful journey in the past decade.

Domino’s is a company that has always tried to have an edge on the market by introducing various unique incentives. It has the famous-“Delivery in half an hour, or its free” campaign which actually started out in the 70s as a “Half hour, or half a dollar off” advertisement. Sometimes it focuses on these things more than the actual product i.e “good pizza”. This led to the downfall of the pizzeria in the 2000s. The company was in huge debt and the stock prices plummeted hard.

Around 2008, Domino’s brand reputation stooped really low. Everyone claimed to hate their pizza, but still ordered it because it was cheap, and tasted “okay”. Basically, it was no more than college-student staple food. Critics called their pizza dry, rubbery, tasted like cardboard, and whatnot.

But, at the end of 2009, Domino’s addressed these claims and took it as an opportunity to rebuild their reputation. They took the criticism in a positive way and started a better campaign: make delicious pizzas! They started making a better recipe from scratch and advertised themselves in a unique way as “new and inspired” Domino’s Pizza.

Let’s look at some of the things that Domino’s did to become one of the best examples of digital transformation and setting high standards for great product management.

Having a technological edge

This fast-food giant has been really stepping up their game in the technical aspects. Though this is not a technological company, it has befriended the latest tech in the most innovative and unique ways.

Making your product different from your competitors

There are a lot of other pizza chains, like Pizza Hut and Papa John’s, that have the same dynamic as Domino’s. That means they are also delivering cheap and fast pizza to the same targeted market. They all have to compete for the same market. In such cases, you must have a certain edge to your product.

Domino’s answered this question by integrating technology deeply into its brand. One of its first advances in the world of technology was a simple delivery app. From that point on, they have never looked back and have managed to use tech as their friend wherever possible.

Being best friends with tech is Digital Transformation

They had the innovative idea of a “pizza tracker” on the app. It allowed the users to see every step of their pizza journey, from the moment the order was placed up to the pizza arriving at your door.

They also had a simple pizza maker that allowed you to design your own pizza, you could select the toppings and literally pour your favorite sauces and everything.

Another great innovation was the “zero-touch” delivery app. You just have to open it and if you don’t do anything for 30 seconds, the order for pizza will be placed immediately. They also had a “tweet to order” campaign where if you tweeted the pizza emoji and tagged Domino’s, your order would be placed.

Changing things for the better

Being open to criticism

Most companies have a tendency to get defensive about their products. When you have been doing something a certain way for years and years, and suddenly one day somebody starts criticizing it, it is definitely hard to take.

What Domino’s did by changing their entire core product in 2010 was quite an impressive feat. One thing we can learn from them is to give the customers what they want, even if it means changing up a 48-year-old recipe. They followed the basic principle of product management: “If it doesn’t work with the people, it has got to go”.

New people = New ideas

When the iPhone app for pizza delivery came out, it was kind of a big deal at that time. It was a definite change in the way that things were being done before. But not long after, the number of online orders surpassed the offline orders.

By 2016, almost half of the employees working there were actually tech people handling the software and analytics. When you think of a fast-food company, you generally don’t picture this. But, Domino’s went a step further than any of its competitors by going through this huge digital transformation.

Asking for help

Another takeaway is that they were not afraid to ask for technical help. Although their core product had nothing to do with the software industry, they collaborated with new people and hired a completely new team to handle those technical aspects.

So, even if your company is unconcerned with technology right now, hiring a new team of technology experts like us to digitally transform your company will always be a step in the right direction.

Involving the consumers

When the people who are eating the pizza are being involved in every step of making it, there is this sense of emotional attachment.

If you know what is happening to your pizza, or where it is at every moment, you won’t complain even if they are slightly late. It’s almost as if you were there. You understand the process because you are informed along the way. Customers become more accepting of slight delays or mistakes when they themselves are involved in the process.

When the customers build the pizza themselves, it is almost as if they co-created the pizza with the actual chef. When the pizza arrives at your door, there is this sense of gratification. Even if the pizza doesn’t taste that good, now you can’t be mad because you are a part of the problem.

It doesn’t just have to be about Pizza either. At Leapfrog, we help businesses with their digital transformation journey and we do the exact same thing. We involve our customers every step of the way to build products that bring the most value.

The cost to quality trade-off

Let’s say, someone orders a cheap pizza from a fast-food chain. It’s fair to say that they’re not expecting any gourmet style, mind-blowing pizza. Mostly they expect a cheap pizza, which is not *that* bad and has a decent taste.

But there is always an imaginary threshold of the core product that cannot be crossed. If you consider a graph with cheapness at the X-axis and quality on the Y-axis, it must be a linear graph. Meaning that there must always be a balance in terms of quality of the product vs the cost that is invested.

Learning to ride with the tide

Domino’s is kind of an expert on making the best out of every situation it is put in. If we look at the history of this company, it started one of the first online delivery services ever. And later, right when the iPhone started booming, they started this mobile app which was a much convenient option for the users.

So more and more people were using iPhones to order from their mobile app. Therefore, they succeeded in having a spot on timing and used something else in a way that was beneficial for their own business. This later proved to be one small step in their huge digital transformation journey.

Riding the tide has always been one of  Domino’s top tactics. Learning from this, all product managers should try and make the best out of every situation.

Being on the right channels

One might think that once you have a nice, decent business going on, you don’t need to be on different channels to grow. But being on appropriate channels is actually a great way to stay ahead of the competition.

In the case of Domino’s, they are pretty self-sufficient and it would seem like they don’t need to be on these other delivery systems like Postmates or Grubhub. But, it is about expanding wherever you can. There might be a whole group of people who like your pizza but don’t want to download another app just to order it.

So in order to target that bunch, it’s just safer to be on the right apps. Instead of competing with other popular apps, you can collaborate with them and increase your reach even more.

For example, if Domino’s decides to collaborate with Slack, it would make so much sense business-wise. Because most offices use Slack workspaces already. And it would be really easy to order lunch for everyone with just a few clicks, rather than going online to search a whole bunch of other pizza places.

Domino’s is a fast-food company, which had nothing to do with technology. But, somehow it has succeeded in being deeply associated with tech, with many of the employees working in software and analytics. It managed to completely reverse its brand and overcome its huge debt in a short amount of time. It is the perfect example to burst the myth that to have a digital transformation, your business must be at least somehow related to tech. Which is simply not true.

In this deep dive into the crazy transformation of Domino’s, we got to learn that associating with tech can do wonders for a company. You must learn to take criticism, embrace the changes, learn from your mistakes, and ride with the tide!

To unpack more questions related to product development dive into our Product Podcast.

Product Management Podcast

Book a Free 30 minutes Consultation about how Leapfrog can help you bring digital transformation to your business.

Drishya Bhattarai

Drishya is a Digital Marketer at Leapfrog. She is interested in SEO, digital marketing, content creation and Designing.

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