domino's new marketing plan
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Domino's Pizza new marketing plan.TRANSCRIPT
Marketing Management
Part A
Marketing is about identifying and meeting human and social needs and one
of the shortest good definitions of marketing is meeting needs profitability (Kotler &
Keller, 2012). Before begin to marketing mix or 4p’s, understanding of STP is a must.
The terms of STP include market segmentation, target markets and positioning.
Segmentation is about identifying the segments for the products or services,
and grouping consumers by some criteria such as within a group which respond
similarity. The potential segmentation variables are such as age, sex, income, educational
level, marital status, culture and etc. Useful segments should be profitable, accessible and
measurable. The objective for segmentation is to find the attractive markets and strategy
involve select which segment to target, break market into components and regroup into
market segmentation.
Domino’s had targeted consumer who looking for inexpensive pizza quickly
because customer are very price sensitive, increase prices will led to decrease of sales.
Domino’s are more focus into delivery and carryout customer compare to dine-in stores.
Viewing in demographic, Domino’s seems not to have a specific target and just targeting
greatest number of people and to be the leader in online pizza ordering.
After segmentation, it will goes to the target market and to find out which
segment should be targeted. This is the real objective that marketer want to achieve in
market. A good target market need to understand the demographic profile of the product
category, must know to compare with competitors, the percent of the population and
segments must be identifiable.
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Domino’s started with targeting students which located near University of
North Carolina and had served 25,000 enrolled students. Domino’s identify the best way
to reach as many students as possible. In Malaysia, Domino’s target is trying to expand in
nationwide by 2014. “According to President and Chief Operating Officer Ba U Shan-
Ting, outlets will be launch in Kelantan, Terengganu and Pahang next year and enter
Sabah and Sarawak in 2015” (TheMalaysiaTimes.com).
Next, after target market will move on to the positioning which this is a vital
element and skill in a good marketing. In positioning, need to determine the way
consumer currently think about the products, decide how you want consumer think about
your product and form out how to reposition. Understanding the levels of competition are
very important because positioning apply in all levels of competition such as industry
level, product level and corporate level, so what is Domino’s positioning.
Domino’s positioning is to reach the customer who values a quick service pizza
by using the geographic information software to reach nearer locations. Domino’s trying
to serve a hot pizza in delivery therefore it created the 30 minute delivery guarantee and
use heat wave insulated delivery bag. In 2009, Domino’s achieve a 92% on time delivery
and achieve the growing segment in online ordering markets through website. Most of the
Domino’s domestic stores are placed in the mid-sized or large cities or nearby the college
or university campuses.
“Most of the companies which are successful are concentrating with the 4p’s
which are product, price, place and promotion” (Gregory Dean, 2010). Product is about
the quality, design, features, brand name, packaging, sizes and services. Domino’s had to
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focus on flavors to capture the market. Example, Butter chicken and the Masala were
confined to the North while Mutton Ghongura and Chicken Chettina confined to the
south.
Price is concern about the payment period, discount, credit terms and allowances.
Domino’s fixed a price of Rs 265 for a 12 inch pizza. Indians are value and not price
sensitive, Domino’s set the price high because the high quality of ingredients and offer
value to customer. In Australia and Spain, Domino’s reduce the price and give discount
to attract customer for the Pepperoni and Jalapeno pizza to compete with Pizza Hut.
Place is about the transport, location, inventory, coverage and etc. Domino’s has
the largest network of outlets across the world. Refer into the channel of geographic
region or industry which a product or services is sold to which segment such as adults,
family and business people are also refer into the environment which the product is sold
may affect the sales.
Lastly, promotion is concerning in the public relations, direct marketing, sales
force, advertising and sales promotion. Domino’s had use advertising, sales promotion
including the education publicity for promoting the services.
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Part B
1.0 Introduction
Domino’s started with one small store in 1960. Then, in 1978 the 200 th Domino’s
store opened and things really began to cook. Domino’s pizza can known as an
international pizza delivery company and the second largest pizza chain in Michigan,
United States.
1.1 History
In 1960, Domino’s Pizza was found by Tom Monaghan in United States in
Michigan and landed in Malaysia in September 1997. Domino’s can know as the delivery
expert company in pizza industry and have around 98 outlets in Malaysia which located
in different states such as Melaka, Perak, Negeri Sembilan, Kedah and Pulau Pinang as
well as seen in year 2012. In 2009, Domino’s establish their businesses to Singapore
because of the healthy growth in Malaysia and now, there have above 10 outlets in
Singapore which growing very well.
1.2 Mission Statements
The vision “Think pizza, choose Domino’s’ and the mission, ‘A passionate team
in pursuit of becoming the unrivalled No. 1 pizza company in Malaysia’. Domino’s Pizza
is passionate about delivering quality food and service. The product and service is all
about convenience, fun, sharing quality time together with friends and families over a
delicious pizza meal delivered from hot and fresh oven to customer’s doorstep.
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1.3 Goals and Objectives
The objectives for Domino’s Pizza are to become the No.1 delivery expert in the
world’s leading pizza and do their best all the time to give the good quality from the
products to the services in all aspects and maintain the current good reputation from
customer which is the quick delivery service.
1.4 Products and Services
Domino’s had come out with a ’30 minutes delivery guarantee’ to their customer
which mean Domino’s will give a free regular pizza voucher if they could not be
punctual to the destination. In addition, Domino’s also provide a ’15 minute’s take-away
guarantee’, otherwise will free a personal pizza on the next order for their customer.
Domino’s also offering free delivery to their customer which no additional charges and
has a product satisfaction guarantee with a Nett Pricing as well.
1.5 Core Competences/ Competitive Advantage
Domino’s Pizza have a special size of pizza compare to Pizza Hut and Papa
John’s which is 15 inch as known as extra large pizza whereby suitable for people who
celebrate party. The company competencies include the online GPS tracker which
allowed consumer to check their pizza delivery status which benefits the organization and
customer.
2.0 Market Analysis
Domino’s started trade common stock in the New York Stock Exchange with the
symbol of ‘DPZ’ in 2004. In Dublin and Ireland, Domino’s hit a turnover of $3 million
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per year. In 2008, an online application launch by Domino’s which the GPS Tracker. It
allow customer to check the status of pizza processing.
2.1 Industry Analysis
There are many pizza makers ranging to international franchises from local
pizzerias such as Domino’s Pizza and Pizza Hut. By viewing into the current health
issues, today’s society as well as economic recession most of the companies are being
forced to follow the healthier and cheaper products. Many companies had added salads
into their menu because consumer now is concern in healthier choices. The popularity of
Internet had become the market trend and market needs as well as the mobile because it is
changing the traditional ways of ordering a pizza.
2.2 Competitive Analysis
Domino’s competes with McDonald’s, Pizza Hut and Papa John’s in Malaysia.
McDonald’s own a very strong image throughout the worlds and Pizza Hut is the largest
competitor for Domino’s in pizza industry and both of this company trying to maintain a
good image to compete. Followed by Papa John’s recently are increasing competition to
Domino’s because of their rising popularity.
2.3 SWOT Analysis
This analysis is to identify Domino’s strengths and weaknesses and correlate with the
opportunities and threats in order to achieve to goals of the company.
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Strengths
Domino’s have a very strong brand image and it is the leading pizza delivery
company with more than 5000 stores in US. It has high brand equity assists by
marketing campaigns and the heavy advertising. Domino’s have its loyal
customers so it can helps the company when they come out with a new product
and have a strong network with its franchises therefore it able to increase the
market shares and sales. In Canada, Domino’s created the world largest pizza
fight every year.
Weaknesses
Domino’s have a major weaknesses which they experienced a sales decrease in
their store which bring down the brand image and the revenues of the company.
This had decline the amount of domestic franchises in 2008. Domino’s will try to
increase back in the next few years for this issue. Besides, the slow growing or
declining sales happen affected by the poor quality which not up compare to the
competitors and the menu are too simple compared to other chains.
Opportunities
Domino’s have their own opportunities and the most major one is the efficient
delivery pizza compare to the competitors. This is a way to expand their operating
effectiveness. Domino’s had offer a services on the mobile application and its
work because many sales are come from iPhone application. There is a big growth
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happen in India and China’s population and this will help to increase their
revenues.
Threats
The increases of food price would be a threat for Domino’s because it impact their
businesses by increasing their operating costs. Besides, the fight of the pizza
delivery industry is absolutely a threat for Domino’s as well. In the fast food
industry, there are always new businesses being crated. In addition, there is
another threat which is people now is concerning with their health issues and this
could affect the profits of Domino’s.
3.0 Market Product Focus
Nowadays, fast food industry is facing healthy issues problems. Therefore,
Domino’s should come out with healthier choices for consumer. Okonomiyaki Pizza is a
pizza and this product operates wells in Taiwan. It is a Japanese savory pancake
containing variety of ingredients that consists of batter and cabbage. Selected toppings
and ingredients are added which can be very greatly.
3.1 Marketing and Product Objective
To enlarge the specialty with healthier choices pizza for consumer and to increase
sales for the company to maximize profits.
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3.2 Target Market
The target market for Domino’s Okonomiyaki Pizza is active in all the stores of
Domino’s Malaysia. A selected area will be more focus such as Subang Jaya, Sunway
and KL which nearby the college or university campus. The main target customer and it
was especially aim to the people in the age group of 16 to 64 are its main target group for
communication which was the young adult from the college student and the adult from
working group. The demographic of the market is to attract the customer from the middle
class and upper middle class because this groups of customers need to spend their money
to enjoy the fast food but in low price. It also target people who want to take a break from
what they eat every day or from cooking.
3.3 Points of Difference
Okonomiyaki Pizza contains healthy dose of bonito flakes which bonito is a type
of fish and come with cabbages toppings which can compete with the competitors in
concerning health issues.
3.4 Positioning
Okonomiyaki Pizza is to create a healthier image to change consumer perception
or consumer mind which is unhealthy to improve better.
4.0 Strategy of Implementation
Okonomiyaki Pizza create is to more focusing on the health issues today and to
develop a different style and culture of pizza for Domino’s in Malaysia to compete with
the competitors.
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4.1 Product
The name of this new product is Okonomiyaki Pizza which already launch in
Taiwan. The standard ingredients of this pizza include healthy bonito flakes which are a
type of fish, stir-fried noodles, Japanese mayonnaise, powdered seaweed and plenty of
shredded cabbages mix with flour and grilled it. The toppings can be chosen or add on
greatly such as mushroom, vegetables, shrimp, squid, chicken and octopus. The sizes of
the pizza include 6 inch, 9 inch, 12 inch and 15 inch as well. The delivery services are
available.
(Source: DominosTaiwan, 2012)
4.2 Pricing
The basic understanding of cost involved is very important to avoid no earnings.
Found that the ingredients for the Okonomiyaki Pizza are not very expensive, therefore
can sell it in a reasonable price to compete with McDonalds and Pizza Hut such as using
set lunch or family combos. The ala-carte price pizza for the Okonomiyaki Pizza will be
RM 9.90 for 6inch, RM 21.90 for 9 inch, RM 30.90 for 12 inch and RM 41.90 for 15
inch. Ala carte will be slightly expensive compare to set, so will provide more set value
and set dinner even family package dinner for customer in the promotion strategy.
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4.3 Place
This product will launch in Malaysia and will active in Domino’s pizza outlet. It
will be more focus in selected areas such as KL, Sunway, Subang Jaya and Petaling Jaya
which nearby colleges or university campuses around that area to target the college
students and foreigner students. Another area will be focus is the office shop lots which
target the working adults who prefer healthy fast food during their short break time with a
comfortable environment during the hot weather in Malaysia.
4.4 Promotion
Create a set lunch for the Okonomiyaki Pizza which include one pan of 6 inch
pizza and comes with a jasmine tea and two slices of fruits to emphasize the healthy tag
line which can fixed the cost around RM7.90 net per set to attract teenagers, students or
working adults from 12pm to 3pm which is dine in only. Okonomiyaki Pizza should be
added into the menu with another column to shows the ingredients contain, and shows
new specialty pizza compete with the competitors. Advertising is a need to promote this
new product to create awareness among the consumer and giving out coupons or voucher
is an advertising which can increase the sales as well. Internet advertising such as using
groupons, dealmates and etc which sells voucher through online can be consider because
nowadays people are attracted to this marketing strategy which goes well in Malaysia.
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5.0 Financial Data and Projections
5.1 Expected Market Share
The health conscious of consumer towards fast food industry will affect the profits of
the company. Therefore, developing healthier or new product may increase back the
sales and market share. For example, McDonalds launch a new product which is
Grilled Chicken Burger (GCB) which contains lowers calories and had attracted
many customer in addition the sales and market share increase during the period. Is a
fact and should believe that Okonomiyaki Pizza will have the same result as well
because it is a product that concerning in health issues by looking in fast food
industry. People do not mind to have a try to choose healthier foods. Therefore, the
expected market shares for Okonomiyaki Pizza will increase the Domino’s market
shares.
5.2 Expected Net Revenue
To calculate the expected net revenue for Okonomiyaki Pizza set lunch, with a RM
6.00 gross profit per unit sold, the expected unit sold per year is 40,000. Therefore,
the Okonomiyaki Pizza net revenue will be Rm6.00 X 40,000 units = RM240000.
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6.0 Implementation Plan
6.1 Gantt Chart
List of Activities Jan Feb Mar Apr May Jun July Aug Sept Oct Nov DecTo develop market testing effectively. To do an office offer for the working adults. To do a promotion campaign in colleges. To do an offer voucher in the internet such as Groupons. To do a contest, win an Ipad seasons! To develop a new toppings turkey for Christmas
6.2 Promotion Schedule
List of Activities Description
To do an office offer for the working adults.
A set lunch of office promotion will cost RM6.90 during 12pm to 2pm include a 6 inch Okonomiyaki Pizza with a jasmine tea.
To do a promotion campaign in colleges.
A roadshow of giving out voucher RM3 for Okinomiyaki Pizza after clicking a ‘LIKE’ to our Facebook Fan Page in college and university campus in selected areas. Terms and Conditions apply.
To do an offer voucher in the internet such as Groupons.
A set of family combo with a nett price of RM50 include two pan 9 inch of Okonomiyaki Pizza, 4 cups jasmine tea, one plate of fruits and 4 pieces of chicken wings. Dine-in only.
To do a contest, win an Ipad seasons! Fill in the answer for the question given in the contest, staple with a receipt purchasing above RM10 to win an Ipad.
To develop a new toppings turkey for Christmas
A new ingredients which is Turkey toppings to celebrate Christmas together with Okonomiyaki Pizza
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7.0 Evaluation and Control
Evaluation is to evaluate the sales or revenue of the product and to control the quality and
understand the risk that will be faced.
7.1 Quality Control
To ensure the quality control, ingredients should always be fresh to be cook.
Training should be provided to the staff to ensure the staff be able to cook well and
serve the good quality food in a right ways to the customer.
7.2 Risk Analysis
The amount of shredded cabbages must be concern when mix with flour to avoid the
uncooked cabbages eaten by customer. All the ingredients must be fixed and
measure accordingly to avoid problems happen which may affect the sales. The
ingredients must put in a suitable place and temperature to avoid wastage such as
octopus and shrimp.
7.3 Evaluation Analysis
Based on the market share expectations, Okonomiyaki Pizza sales analysis will be
conduct every 6 months and adjusting the promotion budget accordingly.
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8.0 References
http://www.dominos.com.my/corporate/Corporate.aspx
http://investorplace.com/2012/11/the-craziest-dominos-pizza-youve-ever-seen-guaranteed/
http://www.brandeating.com/2012/11/around-world-dominos-taiwan-offers.html
http://business.library.wisc.edu/resources/kavajecz/10_Fall/Dominos_Report.pdf
http://www.ukessays.com/essays/marketing/consumer-segments-on-dominos-pizza.php
Dominos.uk.com. (2011). Available from: http://www.dominos.uk.com/aboutus.aspx
http://www.themalaysiantimes.com.my/domino-expanding-nationwide-by-2014
http://marketography.com/2010/03/09/dominos-pizza-beyond-the-dough/
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