A Debate on the Domino's Pizza Self-Loathing Marketing Strategy - Part 1

Domino's: "Our Pizza Stinks". Good Marketing or Bad?

The Old Pizza From Dominos

As you may well be aware, Domino’s Pizza is a company that has made some drastic and gutsy marketing moves in the last couple of years. Now that there has been a little time to observe the effect this has had on the Domino’s overall market, we thought it would be interesting to discuss the possible pros and cons to doing an approach in your restaurant marketing similar to the approach they took.

In case you are unfamiliar with the approach they took, I’ll give you a brief update here: Domino’s customers had for awhile been giving them feedback that the pizza was less than par. While Domino’s prided themselves on being the speediest pizza chain at delivery, they began to have the concerning revelation that no one cared about speedy delivery if the pizza was indistinguishable from the box in which it resided. To their credit, Domino’s listened to the reviews and completely changed the recipe and put energy into making a better tasting pizza.

The thing that most surprised everyone, however, was the marketing that Domino’s added to the equation. Domino’s began running advertising campaigns admitting how horrible of a job they had done up until this point (see video above). They even asked for customer videos on their own website showing examples of horrible pizzas, started a website devoted to this "Pizza Turnaround" as it has come to be known and even began hand-delivering pizzas to their most public critics (see video below). Since then, they have reported an increasing rise in income and sales. They have continued to run major deals and marketed the change hard, and it appears that people have accepted their apology.

The purpose of this blogpost is to determine whether this was the best marketing approach for Domino’s to pursue in their situation and if it would be wise for other restaurants (chains or otherwise) to pursue a similar strategy. I will be coming from the side that states that the Domino’s Strategy was unnecessary (and potentially harmful) for Domino’s and another blogger on our staff (Daniel Hurd) will be coming from the angle that this was the best thing for Domino’s to have done in their circumstance.

We will each begin with opening arguments, and next week we will write a post where we each get a chance to respond to the argument brought against our position, and finish with concluding arguments. We hope that this demidebate proves helpful as you think about your restaurant’s marketing strategy, and hope that you never get to a point where you have to consider using it!

Thumbs up for a good dominos pizza marketing strategy

Daniel's Opening Argument:

Domino’s new advertising strategy is paying off, and not necessarily in cash. Was it the best idea to basically tell all past loyal followers they have been duped into paying for cardboard and ketchup all these years? Probably not. Was it necessary? Yes. The real success of Domino’s drastic marketing scheme is their new-found trajectory of innovation in the big chain pizza world, not simply the marketing itself. Besides increasing their revenue and gaining new public perception of “honesty and authenticity,” Domino’s is beginning to match their pizza’s quality with their existing delivery excellence. They didn’t just market a changed recipe but made an entirely new pizza, which in turn created a new Domino’s. Their trajectory developed from nothing and grew into the leader of the pizza chain frontier.

Domino’s now offers an immersive experience, including customer product reviews available right on their website and a pizza making app where consumers can order the same pizza made in-game. Australia’s Domino’s is introducing free range chicken, electric scooters, along with offering a fan’s pizza recipe and becoming one of Australia’s top ecommerce companies with $1 million in mobile sales in its first week. Internationally, they just designated a Global Pizza Party on December 8th where they had 50% off any pizza at every Domino’s location. Even if Domino’s new marketing strategy fails to pay off in cold hard cash, it was more so needed because it taught Domino’s to actually set a trajectory, one that is currently going quite well.

What I am really driving at is that Domino’s drastic marketing plan was necessary for at least three reasons. First, their marketing has set them up to only improve. Now, as long as they make anything but cardboard, they are instantly better than before. Second, their marketing has caused unprecedented exposure and interest in a place that sells cooked dough, sauce and cheese. Domino’s has created all sorts of “controversy,” this blog being a case in point. Last, and of most importance, Domino’s left side of the brain “woke up.” The amount of social media advertising they are pulling off seems to be keeping other mainstream competitors on their toes. Their launch pad of admitting faults gave them flight for the many other marketing ideas they have already put into place. How can they do anything crazy than what they have already done? All in all, Domino’s itself was most informed and changed by their daring marketing plan, which was a hard but valuable lesson to learn.

Thumbs down for a good dominos pizza marketing strategy

Kirk's Opening Argument:

Here’s the deal, and I want to make this very clear from the beginning. I don’t think Domino’s Pizza is a failure. I think that Domino’s is doing better than they were before, and I think that they will continue to be successful. But if there has been any growth, I will say that it is because of the change in pizza recipe and not because of the “Pizza Turnaround” marketing. What do I mean by that? What I mean is that the biggest mistake Domino’s made was in having bad pizza, not in having a poor marketing strategy. Therefore, what needed to change was not the marketing, but the pizza recipe. Once Domino’s changed the issue that a large amount of people were dissatisfied with (the pizza), it only makes sense that there would be a positive response to that change regardless of the marketing. I would argue that most actual growth in market for Domino’s is because of the recipe change, and not because of this specific marketing. Now you may argue that those are one and the same, however I would submit that Domino’s should have changed the recipe and marketed it as a positive new change and allowed the change (if it was in fact better) to speak for itself. In this age of social interaction and customer reviews, customers are more likely to be attracted to a pizza everyone is talking about rather than one they were told to try with an advertising campaign. Don’t get me wrong, this more organic approach would take a little longer to build than the immediate influx in tentative visits from a controversial “I can’t believe they said that and now I am curious” campaign, but it would have been real growth.

Frankly, there has been much talk of Domino’s increasing in profit and market since this campaign began, but I would argue that true market impact is still as yet, somewhat undetermined. I mean, let’s give credit where credit is due, this campaign did a fantastic job of getting people to talk about and try Domino’s. From an advertising perspective it was a huge success. However, here is the single biggest reason I am suspicious that we are still somewhat living in the end of the initial campaign surge of interest. When you hype up a change in a service or product (not a NEW product, but a change in an OLD one) with a strong controversial campaign like this, you are raising the expectations of your critics to an unrealistic level and declaring the loyalty of your fans to be misled. There are obviously people out there who liked Domino’s pizza the way it was, but regardless of them, the decision was made to not just change the pizza, but to somewhat mock those who actually liked it. For those people who tried a Domino’s pizza in the past and refused to ever eat one again, the expectation level has been set so high that the pizza will have to be heaven on a crust to cause a change of heart. As one advertiser said it: "...the fastest way to kill a product is with great advertising. You will generate trial use, then disappointment, then disdain and revenge."

In lieu of these things, I would argue that the proper course of action would have been to:

  1. Never have missed the boat on this from the beginning. Obviously there are a lot of people who dislike their pizza, and I think this should have been noticed from the beginning. We are having this conversation because Domino’s went far too long ignoring what was obviously being said about them by a large part of the market.
  2. Since they did allow the recipe to be below par, they should have held the focus groups like they did and listened to the complaints and begun making changes (like they did).
  3. Then, they should have changed the recipe as they did and made a better product.
  4. At this point I would have diverged from their “we stink” campaign and gone down the route of a more positive marketing campaign. Something like:
  5. "We are proud to have served great pizza all these years that always gets to you on time. However, we want to not only be committed to fast delivery, but also want to have the best pizza out there. Therefore, we have changed our recipe to make a pizza with more flavorful cheeses, a new secret sauce with zestier spices, and a rich, crispy on the outside and chewy on the inside, buttery crust." That’s it.

  6. After the initial announcement, they could then have proceeded much like they did, with free coupons, facebook contests for free pizza, etc and then stepped away from the advertising and allowed fans and foodies to spread the news organically. The difference would have been that the initial momentum would have been a positive push instead of the negative one that Domino’s chose.

When you listen to your critics/fans and continually make improvements to make a better product, you have success. When you ignore fans/critics for years and then decide to “admit” that you have been doing a horrible job, you are not simply making an unwise business choice. You are declaring your untrustworthiness and the fact that you have been disconnected from your customer’s opinions and desires for years. Basically, I just feel that Domino’s unnecessarily complicated things with an overwhelmingly negative focus and they could have potentially saved themselves from false high hopes and expectations with more of a positive and organically spread campaign of a changed recipe.

Stay Tuned...

Check back next week for the responses and closing arguments. What do you think so far? Do you agree with Kirk or Daniel? Or find yourself somewhere in the middle? Stay tuned!

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Personally speaking, I may not have tried their new pizza if they hadn't admitted their old pizza was horrible. They went from being literally my least favorite pizza chain to #1 or 2 on my list.

I do not think the changes they made were good ones. Its like they are trying too hard. It was bad before and now its still bad just in a different way. It is way too spicy now, and if there was a fresh tomato in there you surely cannot taste it! I love the simplicity of Papa John's pizza and the freshness as well as the crust. Dominos new or old pizza does not have any of this. I cannot think of anything good to say about their pizza. Sorry.

thanks for the input David, I wonder if you would have tried it if a number of your friends were all talking about the differences on Facebook and incited your curiosity enough?  I guess that's where we get into the "speculative" realm and things get a little more difficult to determine in a debate such as this!  Oh well, and either way, thanks for sharing your experience!

Holly thanks for your thoughts.  You help remind us that pizza (being food) is a subjective experience and no matter what is done with marketing or recipe changes, we can still at times prefer another experience.  That's the beauty of being unique individuals (and why multiple pizza chains can work in one area)!
I know one of the things that Domino's prides themselves on is speedy delivery.  Have you found Papa John's to be fast as well?  I will be honest that we live so close to any number of pizza places that I have never ordered delivery but always get carry out so I would be interested to hear your insight.    

Interesting stuff! I really enjoyed hearing each side of this discussion.

For me the marketing has lead to an increased interest in wanting to try the pizza. My wife and I typically find good food we like and stick to it. I don't think we've ordered anything other than Papa John's when we need delivery. Hearing about this campaign and the efforts to which Domino's is going in pursuit of a new image has piqued my curiosity; next time around we're going to try Domino's. I don't think that would be the case if it wasn't for the creative marketing.

Good insight Ross.  Here's where I might surprise you.  I am not saying the campaign doesn't attract interest.  I'm saying that I think you will go try the pizza, but because of all of the negative hype, you will be anticipating a better pizza experience than you otherwise would have expected.  You will try it and say "hmm, I guess it was ok," and then you will go back to Papa Johns.  This may have been your same response if they had gone down the route of a positive marketing campaign, but then they would have not also risked raising expectations for all of their other customers (not just loyal Papa Johns customers) and harming loyal customer opinions just to get a quick influx of "curiosity purchases."  My $0.02.  Honestly, it will be interesting to hear your thoughts once you try it and to see if you like it better.   I do sincerely hope you enjoy it.  I just wish they would have drawn you in through peace and happiness and not self-deprecation. ;)

Good thoughts Kirk! I think this type of marketing will affect different customers in different ways. It seems like our culture places a high value on transparency and integrity. For a lot of people, the quality of the product doesn't matter at all if they feel the company hasn't been honest and upfront. It took a campaign like this for me to seriously consider trying their pizza again. Like you said, the campaign does run the risk of over-promising and under-delivering which might burn customers who set their expectations unusually high. I think it boils down to whether the possibility of disappointment outweighs the positive benefit that comes from running such a transparent marketing campaign.

You're right in saying that this is just a curiosity purchase. Domino's might not keep my business but they definitely got me in the door. I'll report back tomorrow on whether the pizza was good. I think we're making it a Domino's kind of night!

so now that it's been a little bit, how was your impression of your Domino's experience?

The pizza was great, definitely better than anything we've had from Domino's in the past. Will they get our repeat business? Yes and no. We both agreed that Papa Johns was still better. If Papa Johns is offering competitive pricing then we will likely buy from them. However, I'm now much more open to checking Domino's for deals. If Domino's had a more enticing deal on the night we want to buy pizza, I think I'd actually consider them instead of Papa Johns.

Since the original recipe no-longer exists, the campaign brings up two questions for me. 1) Was Domi-Nicks' original recipe not as good as claimed, since they came up with a "New" recipe?  2) Was Domi-Nicks' Original recipe cheapened over the years to lower costs in making the pizza, with the thinking that would increase profit margins without raising the actual cost to the customer? 
With the "Original" recipe ousted the campaign becomes negative, for the loyal customer base and the critics, it leaves one thinking, "Can we trust Domino's?" 

I conclude, they should have kept the "Original' Domi-Nicks' recipe, and offered up the "New" recipe along side with the approach of "We already have a "Winning" product, But while we can't please everyone, we certainly are going to try with this "New" recipe. This would be positive for Domino's, the loyal customers, and the critics. 

Thank you for the engaging comments!
Before answering your questions, I wanted to comment on your first statement concerning Domino's original recipe. If you look online at their website, you can see several comments here and there from loyal customers claiming that Domino's original recipe does indeed still exist in their sauce. If you order a pizza online, you can select four different types of sauce, one of which is "Hearty Marinara Sauce." This, claims Domino's consumers, is the original sauce.

As to your questions, here is my best shot at answering you:

1. The sauce itself must have been decent, seeing as it is still available as a menu option. From a collection of comments I have heard so far, the cheese used was mediocre at best (probably a very waxy, inexpensive bulk purchase) and the dough used was thin, floppy and tasteless. A major critique to Domino's new marketing strategy is the fact that they admitted that the original recipe was not as good as they claimed it to be.

2. This is a great question, one which I can only speculate. Many critics (both positive and negative) highlight the fact that Domino's has first and foremost been known for their fast delivery service. Some people just don't care what their pizza tastes like, they just want it immediately. Domino's executives have stated that one of the reasons for their new recipe change was because of the gap between their excellent delivery and poor product.
  
As to whether or not we can trust Domino's, I will be engaging this thought more in our next post due early next week.

I appreciate where you are coming from in your concluding thoughts, and can agree that this would be most ideal for Domino's. It is balanced and doesn't paint anyone in a bad light. Practically speaking, however, this is impossible. The amount of ingredients needed to keep both of these options available would hurt the company more than help. Much more training would be needed for employees, there would be even less room in the store for storage, and perhaps most importantly their food cost would be astronomically high with many ingredients needing to be thrown away at the end of the day. All this together would probably set Domino's back financially, and the profit margins for franchisers would drop significantly. What do you think? Does this make sense, or could Domino's accomplish both recipes without such a significant loss?

I think both arguments have merit but fail to take into account the "X" factor involved with this campaign.  Pizza delivery from a national chain comes with the an expectation of disappointment.  You don't order from any of the big three expecting a great pie.  You order because they will bring it to you and in a large part of the country pizza is all that you can have delivered.  By acknowledging that they have delivered the same mediocre pizza as everyone else, they have gained points with the public by being honest.

This is what I would call "anti-advertising."  The key to the long term success of the campaign is not that the new pizza is better.  It is that they have branded themselves as the "honest" pizza company.  They aren't going to pretend that you care about how your pizza tastes, but they are at least going to tell you that they care.  They are going to acknowlege that they are trying and that will give them the benefit of the doubt that it was an off night or a burnt out cook.

I would compare this to a politician who said, "I know you hate taxes, but honestly if we are going to lower the debt we have to raise them."  No one is going to be excited by this statement, but at least they are honest.  In a world where choices between politicians and pizza places often comes down to the lesser of two evils, I will always default to the honest one.  

I appreciate your thoughts, David.  I think once again you have helped put a finger on what the real solution is here: "honesty & quality from the beginning is the only way to do business".  We can discuss "cleanup marketing" forever, but the best solution is if there never had to be any cleanup (regardless of what mode it took).  If Domino's had from the beginning been known for (as you put it) acceptable "mediocre" pizza at a good price, and fast delivery.  Unfortunately, they failed from the beginning to establish this and this led to the decision that we are discussing today.

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