A Debate on the Domino's Pizza Self-Loathing Marketing Strategy - Part 1
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!
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.
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:
- 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.
- 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).
- Then, they should have changed the recipe as they did and made a better product.
- 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:
"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.
- 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.
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!