Domino's fast food industry commenced in 1960, and currently, it is one of the leading pizza restaurants across the world. In the year 1960, after the Italian immigrants brought pizza in America, two brothers, Tom and James Monaghan purchased a small pizzeria in Michigan from their friend Dominick Varti for 500 dollars to meet the University cost (Norman, 2009, p. 5). By June the following year, the business had made a profit of 400 dollars which later drastically fell during summer when students left school for the holiday. As a result of this slow phase, James grew tired and sold all his shares to his brother Tom. Later he changed the joint name to Domino and eventually left school to devote more time to the restaurant.
Tom embraced the prospect and revitalized the pizzeria to enhance the company's model. For instance, he enacted decorative changes to the store and also implemented specific business operations in the bid to improve the business profitability. For this reason, Tom purposefully concentrated on developing strategies that could meet the customers’ expectations, and therefore he focused on more streamlined delivery process (Norman, 2009, p. 5). Dominos joint had a limited space to hold more diners, and as a result, Tom employed laid-off workers to deliver Pizzas in the town nearby on a commission basis. Consequently, the delivery strategy engendered the Domino's quick success because the store was able to serve a broader market as compared to other pizza joints which did not offer delivery services.
Domino's company continued to expand over the years becoming the second largest pizza dealer after the Pizza Hut. The company experienced remarkable growth, and by the year 2000, Domino's food industry had over 6500 joints across the world making a sale of over 3 billion dollars. Besides, in the early 1970s, the company campaigned for 30 minutes or less pizza delivery which became more popular among the fast food consumers (Okumus"Bilgihan, 2014, p. 40). By the year 2008, the store had established an online system that allowed customers to not only order for their Pizza online but also track the delivery process in real-time. Equally important, Tom implemented a formalised method of production and delivery that incorporated, equipment replacement, division of labour all tailored to attain a constant output of pizza. Therefore, the emphasis on uniformity of production and quality played a crucial role in ensuring a successful business operation and expansion through franchising.
Major Competitors
Although Domino's corporate model is straightforward with a secure ordering of quality food, the restaurant chain is not without competition. For this reason, the industry has received competition from other fast food restaurants such as the Pizza Hut and especially regarding the food quality. Majority of the customers raised complains that the ingredients are frozen, premade or canned to reduce the production cost. However, despite these complaints, the corporation has adopted profound measures of embracing technology to reach a broader market more efficiently. Some of the major competitors include the following;
Pizza Hut
Pizza Hut is possibly the considerable primary challenger of Domino's Pizza Company regarding both the brand and the method of operations. Notably, the joint has expanded throughout the world, and by 2016, it was positioned as the most substantial pizza outlet. Besides, apart from providing pizza, the outlet offers other meals and different cuisines an indication that it is the leading fast food store.
McDonald’s
Two brothers in California established the store as a barbeque fast food joint specialising in producing burgers. Since then the outlet has undergone significant transformations changing the entire business operation which has arguably created competition for the Domino's Pizza. For instance, the outlets have incorporated fast service and delivery systems similar to that of Domino’s Pizza. As a result, the joint has become popular among many households and have expanded throughout the world accumulating an income of 7.8 billion dollars annually (Wagner et al., 200, p.80). Notably, the joint covers around 18%percent of the total fast food market. Therefore, because of the significant distribution and popularity of this store, McDonald's is arguably the second considerable competitor of the Dominos regarding fast food operations.
Kentucky Fried Chicken
The outlet started in Kentucky majoring in producing fried chicken throughout the world. KFC is the second largest fast food joint in America after the Mc Donald's. KFC has continued to grow in various parts of the world regarding both the sales volume and the production operations. Despite the fact that most people commonly recognise it with the trademark of fried chicken production, the joint has diversified to offer a variety of fast food menus. Owing to the fact of the company's location distribution and consistency in providing high-quality food, KFC is one of the significant competitors of Domino's Pizza outlet.
Starbucks
The outlet has been in operation for about 46 years majoring in offering coffee to customers worldwide. Starbucks is the largest coffee outlet while considering the number of the outlet it has and also the income it generates from the sales of coffee. As a result, regarding the revenue it generates from this fast food industry, Starbucks is a major competitor of Domino's Pizza in the fast food industry.
Factor of Success
Most individuals commonly recognise Domino's fast food store as one of the most efficient pizza delivery chain covering around 20% percent of the fast food market throughout the world. The company has adopted various strategies to maintain a competitive advantage over the other fast food industries. These strategies comprise of; use of technology, franchising methods, and innovative delivery processes appropriate in ensuring that the company is in a competitive position based on pricing, supply chain, marketing, and brand values.
Technology Use in Supply Chain
Given the rising competition in the fast food industries, Domino's Pizza has adopted the use of technology platforms to deliver fast food to their customers. As a result, the approach has given the company an advantage over the other competitors because of the ability to reach a broader market. The online system has played a significant role in reducing the cost of business operation because it requires less labour not to mention that the likelihood of causing mistakes is minimal. Besides, the company has developed mobile applications which can track customer's preference based on the past orders.
Doyle, the company's manager, reconfigured an online ordering system which proved difficult for other competitors to mimic easily. Therefore, Domino's became the first outlet to introduce online ordering without necessarily making a call. For instance, on these mobile applications, there are various features such as Virtual Pizza Builder that bring pizza toppings on the individual's screen (Okumus"Bilgihan, 2014, p. 35). Importantly, these mobile applications contain a unique feature of Pizza Tracker. For this reason, most customers order their fast food from the Domino’s Pizza stores because they can track the progress of the whole operation from the time of order to up to the delivery point. The approach ensures that supply system is transparent and therefore embracing digital use has played a pivotal role in positioning Domino's Pizza outlet as one of the leading corporations in the fast food industry. Besides, the active management of their organisation has been vital in ensuring that, the outlet upholds good business fundamentals through the creation of more reliable and convenient delivery strategies and online marketing campaigns.
Brand Value
One of the most effective marketing strategies that Domino's outlet has focused on to attain an advantage over the other competitors is the creation of a new and improved fast food. Notably, initially, the customers had reported that their pizza was devoid of flavour which made the company admit that their pizza was terrible and unlike other companies, it apologised profusely to the consumer (Deivanai, 2013, p. 154). The outlet engages customers in giving their views concerning the product by designing a website by the name Pizza Turnaround whereby the consumers document their honest opinions. In contrast to the other companies, Domino's show their response on these websites without editing or photoshopping. Therefore, the corporation can successfully use the online platform to improve their brand based on the customer's comments.
Domino’s fast food has also promoted strong brand awareness as compared to other fast food companies. Most customers relate their products with fast delivery of quality food. Notably, in the recent years, Domino's has spent close to 1.4 billion dollars in both international and national advertisement platforms (Deivanai, 2013, p. 160). For instance, they profusely advertise their products through television, print Media and also web-based advertisements whereby most people commonly refer to it as a Mega Brand. Equally important, Domino's fast food has reinforced their brand marketing strategy by adopting marketing affiliation strategies with other brands such as Coca-Cola. Thus, their product has become more popular among the consumers than that of their rivals promoting brand strength and the business outcome.
Domino’s Fast Food Marketing Strategy and Pricing
One of the most effective marketing approaches that Domino's fast food has adopted the delivery of food to customers in 30 minutes. As a result, the strategy has placed it in a better position as compared to their competitors because they guarantee customers a fast delivery of quality food. The company makes use of differentiated approach of targeting customers and the general market regarding individual’s preference taste (Berry"Parasuraman, 2004, p. 120). In retrospect, Domino's outlet has successfully positioned itself in a better place by offering a variety of options to the consumers. For instance, the store offers both vegetables and non-vegetables pizza, and as a result, Domino is now nearly covering more shares of fast food market than Pizza Hut their chief rival. Therefore, the quick delivery services and the variety of options available have played a significant role in enhancing the value delivery process as well as boosting the overall business outcome.
The strategic location of the Domino's stores has been crucial in ensuring that the outlet offer services to customers in the most efficient way. Besides, incorporating value delivery approach has helped in decreasing the turn-around time of serving the customer a key advantage of Domino's fast food over their main competitors. Besides, Domino's have integrated various components which have been effectual in ensuring that their business is viable as compared to that of their main competitors (Wagner et al., 2003, 83). Specifically, the management has designed low-cost outlets in the essence that they do not develop their stores with plush interiors. For this reason, the approach has put the outlet in a better position of making more sales because of the enhanced faster consumption of pizza and other fast foods.
Dominos Fast Food Company has placed itself efficiently as one of the leading pizza brands behind the Pizza Hut by offering their services to customers at a competitive price. Globally, there are many options for fast food varieties and outlets and therefore, increasing the customer base and also the fast food market shares appear to be quite a challenge. Specifically, in developing countries, it is significantly formidable to escalate the market size because of poverty levels in these countries accompanied by the low standard of living and also low per capita income (Berry"Parasuraman, 2004, p. 127). Therefore, to increase sales and especially in these countries, Domino's have designed low-cost stores located at strategic places to cater for the customer’s needs efficiently without incurring more cost. In retrospect, they promote not only online sales but also the approach has enabled the company to boost online purchase besides offering discounts to their customers.
Current Position of Domino’s Fast Food
Domino's position has significantly changed with the expansion of the international market. Despite the many brands saturating the marketing today, the outlet has established their brand substantially primarily in the United States of America. By the year 2014, Domino's had reported 8.3% percent increase in the total sale worldwide (Norman, 2009, 52). Currently, the outlet is the second largest fast food store after the Pizza Hut. The company has 4000 stores worldwide while Pizza Hut leads with 5900 stores throughout the world. Research conducted by business analysts attributes the growth of the international market for pizza to rising income globally and the increased preference for pizza among fast-food consumers (Deivanai, 2013, p. 165). With the continued global expansion, the company is using the increased cash flow in venturing into emerging markets of fast foods. Precisely, the outlet is now investing in fast food business opportunities that have a stable stream of online usage amongst the product users. Besides, the company has promoted their sales by increasing incentives for franchisees to increase the number of stores globally. In doing so, the company reduce the franchise fees and also alter the revenue sharing ratio in favour of the franchise.
Recommendation and Conclusion
The fast-food industry has continued to grow throughout the world and has attracted many investors in the last decade. Domino’s now increasingly faces competition not only nationally but also internationally. Therefore, in the bid to maintain a better position as compared to other companies, the outlet needs to make sure that it has adequate strategies in place to develop continued technological innovations. For instance, Domino's should establish consistent training programs for their employees and especially in regards to the current trends in fast food industries and also the expansion of the global market. Besides, the company should explore better alternative delivery methods to meet the customers' expectations and also reduce the operation cost. For example, Domino's should integrate the use of autonomous vehicles to deliver food to their customers as it will be crucial in boosting the corporate profits. Finally, the company should develop a steady online platform that allows for data collection regarding the customer's preferences as it will enable the outlet to produce food that is in line with the consumers' trend and preferences.
List of References
Berry, L.L., and Parasuraman, A., 2004. Marketing services: Competing through quality. Simon and Schuster.pp.121-130
Deivanai, P., 2013. A study of consumer behavior towards fast food products with special reference to Domino’s Pizza. International research journal of business and management, (5). pp. 154-172
Norman, D.A., 2009. THE WAY I SEE IT Systems thinking: a product is more than the product. Interactions, 16(5), pp.52-54. ---
Okumus, B. and Bilgihan, A., 2014. Proposing a model to test smartphone users' intention to use smart applications when ordering food in restaurants. Journal of Hospitality and Tourism Technology, 5(1), pp.31-49. ----
Wagner, P. Azrak, G., Monteith, T Vitek, J., Scheible, J. and Haubenstricker, D., DOMINO'S Inc and Domino's Pizza PMC Inc, 2003. Method and system for routing food orders over a computer network. U.S. Patent Application pp. 76-85
