Domino's Marketing Plan: New Products and Strategies Explained

MARKETING PLAN 1 Marketing Plan Mallory Moore Western Governors University C212 Marketing Maryann Lamer

MARKETING PLAN 2 Marketing Plan A.1 New Products In Ypsilanti, Michigan in 1960 Dominoes was founded. Dominoes opened a stored in Canada. Owner of Domino’s Tom Monaghan had purchased two additional pizzerias by 1963. This company has grown exponentially having over 17,200 stores, in 90 global markets, and in all 50 states. Dominos has over taken Pizza Hut and Little Caesars, and is the first largest pizza chain. Two products that I will propose are soda fountain systems and a breakfast pizza. A1a. Three Methods to determine product needs The first method used to determine product was a focus group comprised of Domino’s customers. The first method is a research technique uses group interaction to collect data. A small group of people are carefully selected to discuss a given topic. This method is used to discuss how people behave or think, using how, what, and why questions. 15 carefully selected Dominos members from all parts of Canada. A third-party moderator was utilized to being selected. Data from the focus groups showed that participants found the new displays suitable. The data collected from the focus groups showed which regions would be the best to roll out the new menu items. Direct observation was the second method we will utilize. The best method to use to gather information without impacting outcome is Direct observation. This method is one of the most powerful tools to gain the insight of customers. The new menu items were launched in two specific locations where we measure our customers responses to the new products. Through direct observation we were able to gather information on the products were viewed by

MARKETING PLAN 3 customers. The data gathered showed that there was enough of a demand for these new products in Canada to expand our roll out. The final method utilized was customer surveys. This method is used to collect date from predefined groups of participants to gain insight and information into topics of interest. To facilitate this method surveys were provided online and in Canada. On the surveys we provided customers with a list of items that customers would potentially like to see added to the current menu. To facilitate the usage of the surveys by customers we implemented a discount of 15% off the next order when surveys were completed (1 per order per customer). It was concluded that adding an incentive would encourage customers to provide applicable data regarding the addition of the new menu items. Data collected from this method showed a sufficient demand for the new menu items. A1b Competitive Advantage Pizza Pizza and Pizza hut are Domino’s top competitors in the Canadian Pizza Market. The new menu items proposed are not offered by the competitors. Adding the breakfast pizza and soda fountain system too Domino’s can forge further ahead than its competitors. By displaying these items Domino’s takes advantage of people that prefer multiple options at their favorite restaurants. These new products attract not only adults but teens and children to try the new breakfast pizza and cup of soda. A1C. Product Launch Risk The launching of new products always comes with risks. In order to ensure the success of new products it is imperative that these risks reduced. The firs risk would be the inconsistency in the quality of finished products. Consistent quality is required to ensure that a product does not fail. To ensure that Staff are appropriately trained in how to make the breakfast pizza and use

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MARKETING PLAN 4 the soda machine a new training program is being developed. The training program will consist of videos that show the process of making the breakfast pizzas and using the fountain soda machines. This training method will ensure that training is cohesive and performed with the same quality across all of the branches. A trainer will follow up with each branch to supervise all trainings prior to the launch of the new menu items across all the branches. This training program will help Domino’s obtain a greater market share and enhance the potential for success. The second risk is the disparity in the supply of fresh ingredients for the breakfast pizza. There will need to be fresh ingredients such as eggs for the breakfast pizza. To help alleviate any risks associated with fresh ingredients Domino’s should source from two or more of Canada’s largest suppliers. Should the main suppliers have any issues Domino’s will have a backup supplier. A2. Customer Relationship Management (CRM) In order to manage interactions with potential and current customers a CRM will be utilized. To build customer relationships to increase sales, increase profitability, and improve customer service Domino’s will use a CRM. My CRM recommendation is salesforce. Salesforce is an integrated CRM platform gives all departments such as commerce, marketing, sales, and services a share single view of all customers. This system allows the management and storing of prospects by saving customer information such as accounts, leads, contact information, and sales opportunities in a central location. Salesforce is a fully cloud-based program. Salesforce is mobile, allows pnline ordering for customers, is mobile, and easy to train new employees. Salesforce provides continuous updating for inventory management and helps to tack employee performance and sales in real time.

MARKETING PLAN 5 A2a.CRM Practices Salesforce provides sales tracking data. This information allows Domino’s to ascertain which items will be more popular at which locations. Salesforce will help Domino’s determine what products are selling well, and how to advertise menu items at each location. It will also help Domino’s determine how their menus should be organized and which menu items to focus on. Salesforce assists customer service management to understand customer needs and ensure customer satisfaction before, during, and after ordering. Salesforce allows Domino’s to track opportunities and contacts, increase sales, and manage teams. Salesforce provides multichannel marketings campaigns. Salesforce allows direct customer contact with Domino’s and helps with productivity tracking. A3. Distribution Channels Domino’s Pizza will be utilizing direct distribution channels for its products. Sales will be made in person, online, or over the phone to customers directly through carry-out, delivery, and Dine-in. Some items will be sourced from the US, and some from Canada. Fresh ingredients will come from Canada. The soda fountain system will be sourced from the US, from the main supply station to each store. Should issues arise with the Canadian supply chains the ingredients can be sourced from the US. A3a. Key Considerations The trade agreement between the US and Canada is the first key consideration. A free- trade zone in North America was established by the North America free trade agreement. The elimination of all tariff and non-tariff of trade and investment between Canada and the US is the reason NAFTA was founded. NAFTA makes it possible for Domino’s to export ingredients without any tariff raising prices.

MARKETING PLAN 6 The next consideration for Domino’s is the management of global distribution channels. Dominos has the option to either use a central system directly managed by Domino’s or allow the country franchiser to manage the distribution channel. The distribution centers globally, unlike US operations use the chief franchise model. The supply chain and distribution centers needed for all branches is set up by the franchiser. Domino’s has knowledge of current laws in Canada and less overhead. A3b. Supply Chain Dominos already has an existing supply chain between the US and Canada. Dominos ingredients are either imported form the us or sourced in Canada. The current supply chain will be used for the new menu items. The main supply channel in the US can ship the soda fountain system to each branch. Eggs and a fresh assortment for the breakfast pizza will be sourced from Canada distributors to ensure freshness. NAFTA assists with keeping supply chain downtime low and allows Domino’s to stay resilient. A4 Pricing Strategy For the two menu items Domino’s will use penetration-based pricing. Penetration-based pricing can be used to help Domino’s grow its market share quickly, assist Domino’s in offering the products uniquely over its competitors. The new products will be offered at a price low enough to discourage competitors from offering identical items due to low profit margins. The breakfast pizza will be priced at $5.50, and the soda will be priced at $1. A4a. Cost of Developing Products The development of new products comes with multiple costs. The costs for the new menu items include marketing, training, materials, research, initial and final ingredient testing, and development. Marketing costs cover all activities before and after the launch of the new menu

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MARKETING PLAN 7 items. All the ingredients and equipment needed to prepare the menu items is included in Material costs. The training program will be included in the training costs. A4b. Consumer Acceptance Data for the focus groups indicated that customer are prone to pay more for better quality products. Initial surveys data indicated the acceptance of the new products by most customers. Questions presented on the surveys included quality of new products and pricing. Selected prices are as follows $5.50 for the breakfast pizza and $1 for the sodas. The new price points were found to be acceptable per the initial testing launch data. A4c. Competitor Pricing Pizza Pizza and Pizza Hut are the main competitors to Domino’s in Canada, as they do not offer any products that could directly compete with new items Domino’s now offers. Neither competitor at this current time offer a breakfast pizza. They both do however offer wings priced at around $6.29 depending on order quantity. Pricing the breakfast pizza at $5.50 keeps it below the competitors’ prices. Pizza Pizza and Pizza hut both offer sodas at the price of $2, so Domino’s $1 sodas are cheaper and will attract customers to come and try their sodas. A.5 Promotional Strategy Domino’s will use a pull promotion strategy to promote the new menu items in Canada. Promoting and advertising the products can increase their demand. The objective of this strategy is to create loyalty to the products and attract customers. This strategy will help Domino’s to surpass their competitors and create long-term market growth. A.5 Media Channels A good toll for promoting new products is using media channels. The first media channels utilized by Domino’s will be radio and TV. Running dual advertisements on both

MARKETING PLAN 8 medical channels will assist with promoting the new products. Domino’s will also use social media advertising campaign. Domino’s will utilize Instagram, Facebook, and YouTube to product the new menu items. Domino’s will pay for advertising on the platforms to announce the launch of the new menu items. A5a. Channel Justification Media channels such as radio and TV have been selected due to a greater possibility of reaching a group of individuals. Channels such as radio and TV are time tested methods that are effective and able to be directed towards specific populations. To increase knowledge of the new menu items, Ads can be utilized and tailored to reach all market segments. An example would be broadcasting an Ad during a sports game to reach a specific demographic such as sports fans. While these mass media channels may come with higher costs, they can reach a large group of potential customers reinforcing a large demand fort he new items. To reach customers who use at least one social medica platform Domino’s will utilize Instagram, Facebook, and YouTube. The previously stated social media platforms are the most popular platforms in Canada and play a key role in increasing brand awareness and growing their brand. Social media platforms have the ability to reach various market segments. Customizing advertisements towards targeted groups of individuals can increase demands for the new products. A5b Sales Promotion Different promotional activities will be used to promote the new menu items. The first promotion used will be coupons. Coupons can be disseminated multiple ways including newspapers, physically passing them out to customers, and emails. The coupon will offer one

MARKETING PLAN 9 free small soda with the purchase of a breakfast pizza. This promotion could attract additional potential customers. The second promotional tool will be a social media giveaway. Dominos can run contest over social media. These contests would entail customers uploading pictures of their purchase of one of the new menu items and posting it to the Domino’s social media pages. Domino’s will then pick a photo randomly and post the winners and their rewards. This promotion can increase demand by bringing more awareness to the new products.

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MARKETING PLAN 10 References (n.d.). https://canadianinternet.com/2020-report-social-meida-use-canada/ (n.d.). https://www.cbp.gov/trade/nafta Bhat, A. (2018, October 12). Surveys: What they are, characteristics & examples . QuestionPro. https://www.questionpro.com/blog/surveys Cameron, J. (2005). Focusing on the focus group. (Qualitative research methods in human geography 2 no 8 ed.). Chen, I. J., & Popovich, K. (2003). Understanding customer relationship management (crm). Business Process Management Journal , 9 (5), 672–688. https://doi.org/10.1108/14637150310496758 Taylor-Powell, E., & Steele, S. (1996). Collecting evaluation data: Direct observation (Program development and evaluation. Wisconsin: University of Wisconsin-Extension ed.).

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