Dominos Marketing paper c212 part 2 PDF

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Experience the new Apple Pie Dessert Pizza and the Bacon Cheeseburger in surrounding Canada area’s

Rodriques Fruster Marketing c212 Program Mentor: Sofia Habib Master of Business Administration Program Western Governor University

Table of Contents

Introduction and New Products and Services Identification of the Global Market Inherent Risks Competitive Advantage Distribution Channel Pricing Strategy Promotional Strategy References

New Product and Services In 1960, two brothers, Tom and James Monaghan, decided to purchase a restaurant location for $900 and named the restaurant Dominick's. Later, Tom renamed the restaurant to Domino’s Pizza. Domino’s Pizza is known for its delicious pizzas from small, medium, large, to extra-large. Over the decades, Domino’s has grown from one pizza restaurant to more than 5,600 U.S. pizza restaurants. Domino’s became the fastest growing pizza restaurants in the United States in 1985. Domino’s mission was to become the leader in pizza delivery (Domino’s, 2019). In 2008, Domino’s Pizza became the world’s largest sandwich delivery restaurant when the launched a line of oven-baked sandwiches. In 2009, Domino’s added Penne Pasta and Chocolate Lava Crunch Cake to their menu. In 2010, Domino’s produced an entirely new pizza recipe including new sauce, crust, and cheese. In 2011, Domino’s continued to revamp its menu by launching a new recipe of wings, boneless chicken wings, stuffed cheesy bread, and parmesan bread bites. In 2015, they added the Marbled Cookie Brownie to the menu (Domino’s, 2019). The two new items that I am proposing for Domino’s to text market are the Bacon cheeseburger for which will have a bun made from the same dough as their pizza and an apple pie dessert pizza that will be made with real apples. Domino’s will market the two new items in Canada.

Identify need and existing global market When researching the need for these two products in the global market Domino’s will use three research methods. These methods will ensure that there is a market for the menu items, ensuring that the new items will be a successful. We will use direct observation, focus groups, and surveys. Direct Observation There are different ways to observe customer’s buying behaviors. Direct observation is an incredible way of gathering data about how buyers interact with products. Observation is one of the most powerful tools for gaining the insight of customers (University of Cambridge, 2016).

One of the main advantages of direct observation is that it describes the behavior without influencing the customer’s behavior under observation, which will also be helpful in obtaining more accurate data. With direct observation, we will be able to observe how customers enjoy the product being launched by Domino’s. With direct observation there will also be sampling for new items where customers can taste samples of the new items and by the customer expression and behavior we will be able to see if they like the product or not and decide if the product could be a new go or a go.

Focus Groups There will be a team of 6-12 people that will make up the focus group. Focus groups are mostly researching your business to gather information about the customer’s perspectives and their opinions about new ideas, products, and services. Focus groups are a way to gain insight into current and prospective products, services, and ideas. The main purpose of putting together, a focus group is to get as many ideas and perspectives as possible (Lotich, 2011). There will be an independent team that will promote the focus groups for Domino’s. The focus groups will be comprised of different people from college students to 50 years of age both male and female. There will be representatives from Domino’s Pizza Headquarters and different customers from different Canadian locations where the cheeseburger and apple pie dessert pizza will be launched. The focus groups will be used in store and online to gather data and feedback from many areas in Canada regarding their perception of the new services.

Surveys The final method that will be use is surveys. Surveys can be completed online or in person at the restaurant. Surveys will also be included in the Domino’s pizza app and website and distributed in emails to customers. Another great options will be using social media, such as Twitter, Facebook, and Instagram. In exchange Domino’s will provide customers with code to enter for a 20% discount off their next purchase for new items. Surveys are a way to give feedback from customers at the time of checkout. They are a straightforward method of knowing

whether the customers are satisfied or unsatisfied with the business's existing services and products and what changes the customer would like to see or experience. Surveys can be conducted as web questionnaires, which will enable Domino’s to collect feedback and then analyze it for future administrations (Martin, 2016). Once the research has been conducted and analyzed, it will be shown that there is a need and existing global market in Canada for the two new products.

Competitive Advantage Domino’s already has a competitive advantage for making and delivering pizza and other non-pizza food items. Adding the double bacon cheeseburger and the apple pie dessert pizza will push their competitive advantage further. Big Rod's Pizza is Domino’s largest Canadian Competitor and they hold a large market share because of their inexpensive pizza, but the quality of their menu items do not compare to the level of quality that Domino’s provides. Domino’s is continuing to make fresh pizza and uses fresh dough. When customers hear, the name Domino’s, they can associate it with a 30 minute's delivery guarantee. With Domino’s offering the double bacon cheeseburger not offered in any other pizza place in Canada, they could help attract customers who enjoy pizza and burgers. Recent data has shown that 73 percent of customers would enjoy a pizza place where they can enjoy pizza and double bacon cheeseburgers. Having the choice between the new double bacon cheeseburger and the sandwiches, pizza, and chicken that Domino’s currently offers will be a home run for Domino’s. Everyone loves apple pie and adding the apple pie dessert pizza to the menu will attract more customers. Data shows that 83 percent of Canadians would love to see the apple pie dessert pizza be added to the menu. Adding these new items will be a huge plus for Domino’s and boost their competitive advantage.

Inherent Risk There are always risks of launching new products, but reducing those risks are very important. One inherent risk for the double bacon cheeseburger would be that and employees might not cook it to the temperature that it requires or leaving the beef out would cause germs to

infect the beef and the burger could be spoiled. Another risk could be that if the burger is not out for delivery in time it could become cold and hard, this event would cause the burger to be thrown away and lose money. To prevent this, Domino’s would ensure that employees would be properly trained on the storage, preparing, and delivery procedures for this new product. Another inherent risk that Domino’s could face is that the apple pie dessert pizza is that apples are seasonal, and they could run out of apples and cause a low inventory. This would cause Domino’s to lose money, especially doing the holiday season where everyone enjoys eating pies for family dinners. If the restaurant runs out, they would have to wait for a new batch to be shipped to the restaurant. Also, if the apples are left out, they could become spoiled if employees do not properly place the batch back into the freezer. In other to prevent this from happening, Domino’s would have to ensure that they have enough apples and ingredients to meet demand especially during the holidays which will be the busiest time of the year.

Customer Relationship Management CRM is a strategy for managing the relationship a company has with their customers. A CRM system helps companies stay connected to customers, streamline processes, and improve profitability. A CRM System is a tool used for contact management, sales management, productivity management, human resources' management and more. The goal of a CRM system is to improve business relationships. CRM Software records customers contact information such as email, telephone, website, and social media profiles. It can also automatically pull in other information, such as news about the company activity and it can store details such as a client’s personal preference on communications. CRM enables a business to deepen its relationships with customers, service users, colleagues, partners, and suppliers. Forging good relationships and keeping track of products and customers is crucial for customer acquisition and retention, which is at the heart of CRM function. You can see everything in one place with a simple, customizable dashboard that can tell you a customer’s history with you, the status of their orders, and any outstanding customer service issues (saleforce.com, 2019). I recommend Salesforce. Salesforce is a cloud base customer relationship management

(CRM) platform for supercharging every aspect of your company and the interactions of customers including marketing, sales, commerce, services and more. CRM software lets you store and manage prospects by saving customer information like contact information, accounts, leads, and sales opportunities in one central location. One feature of Salesforce is that it is fully cloud based. Salesforce will be easy to train new employees. Salesforce is also mobile and will allow customers to order online or on the website. Salesforce will provide suitable inventory management that will continuously update. Salesforce will help with tracking sales and employee performance in real time.

CRM Practices Data provide by Salesforce will be used first to track sales. This information will be valuable and enable Domino’s to understand which food items are more popular at each location. It will also help determine if the double bacon cheeseburger and apple pie dessert pizza are selling well. Also, Salesforce will be able to help determine how to advertise at each location and how to structure the menu to highlight the most popular items. Salesforce will help with customer service management by getting to know the ideal customer needs, getting before them and serving them and making sure they are happy before during, and after the purchase. Survey showed that 72 percent of Americans were far more likely to shop from brands that are known for making top-notch customer service a priority. Salesforce will give real-time customer interaction platform to help them drive connected, relevant, and cross channel engagement across the entire customer lifecycle. Salesforce also will help to identify customers that have dropped out of the journey and create audience segments for purposeful re-engagement. Also, Salesforce will help monitor social media, by what people are saying about the business, what customers like and would like to see. Salesforce will help with productivity with employees who are performing well, and those that need additional training (Salesforce, 2019).

Distribution Channel Domino’s pizza will use the distribution channel of direct sales because customers will

order on the website and on the Domino’s app. Domino’s will ensure the delivery of the double bacon cheeseburger, and the apple pie dessert pizza by their own delivery drivers to customer's homes. Using their own delivery drivers, Domino’s will charge a delivery fee of $2.99. Domino’s will also set up a distribution center in Canada that will deliver and distribute their items to their stores by trucks. Domino’s delivers to their restaurants every other week by their distribution center trucks. Domino’s will also have a distribution center between the United States and Canada. The apples and beef will be imported from the United States before they are prepared and cooked by Domino’s.

Key Considerations One key consideration when exporting our products to Canada from the United States is that the North American Free Trade Agency (NAFTA) has eliminated certain requirements that now allow the countries to ship goods without any fees or filings. To ship our products and ingredients will be no issues for Domino’s. Another key consideration was the managing of the distribution channel internationally. They had the choice of a centralized system, managed by Domino’s directly or allowing the franchiser in the country to manage the distribution channel. Unlike the United States operations, the distribution centers at the international level use the chief franchise model. The franchiser there will set up the supply chain and distribution centers that are needed for all the stores. By using a chief franchiser model in the international markets Domino’s has less overhead the stores. The chief franchiser would have knowledge of current laws and real estate laws in Canada.

Supply Chain Domino’s already has a distribution center set up between the United States and Canada. The beef and apples will be imported by the United States and these ingredients could be affected by the weather or snow in the northern part of the United States which will cause the roads to be unsafe to travel due to the ice and snow.

Pricing strategy and Costs Domino’s main demographics are college students and people up to age 50. The goal for Domino’s is to have quality products with the best reasonable prices. For the double bacon cheeseburger, Domino’s will use the penetration base pricing. Penetration base pricing is when designed to keep prices low to shut out other competitions. The goal is to attract customers for the bacon cheeseburger for the low cost. Because of the fast food restaurants that sell bacon cheeseburgers. Domino’s will sell its bacon cheeseburger for a cheaper price than the competitors. Data from our focus group shows that the fast food restaurant's average prices on a bacon cheeseburger are around 4-6 dollars. Since Domino’s will be the only pizza place that will sell a bacon cheeseburger, we priced it for $5.50. Data shown that competitors who sale a bacon cheeseburger at their restaurant sales it around the same price.

Competitors Prices McDonald, Bacon McDouble is priced at $6.00 dollars, Hardee’s Bacon Cheeseburger starts at $5.29 to $9.09 depending on the size of the burger. Wendy’s baconator starts around $4.06 to $6.09. Surveys show that consumers would be acceptable of our price for the Bacon Cheeseburger at $5.50. One of our survey question we asked was would you be willing to buy a bacon cheeseburger for $5.50 (Fast Food Menu Prices, 2019)

Consumers Acceptance for the Bacon Cheeseburger When evaluating data from our survey, our research team showed that 73% of consumers said they would buy a bacon cheeseburger from Domino’s for the price of $5.50.

Apple Pie Dessert Pizza For the apple pie dessert pizza, Domino’s will use the product line pricing since data shown from our focus group, shows that there are no other competitors that sell an apple pie dessert pizza. Domino’s will sell this item for $7.99. This size dessert will be equal to a medium size pizza. The price of the new product launch is the increase in materials, labor, and

distribution cost as well training employees on how to make the new items.

Competitor Prices When the focus group did their research, they found that there are no competitors who sale an Apple Pie Desert pizza or any Apple Pie. For our price $7.99 that will be equal to a medium size pizza. Consumers Acceptance for Apple Pie Dessert Pizza Survey shown from the focus group and inside and web survey that 83% of consumers said that they would be acceptable of the Apple Pie Dessert Pizza for $7.99 which will be average to a medium size pizza. Consumer can also purchase the Apple Pie Dessert Pizza in a large size for $8.99.

Promotional Strategy

Two mass media that we will use to advertise is TV and billboards. TV is a great way to market your products. Millions of people watch TV, watching their favorite shows or watching the news. Especially, people ages 18-50 who loves to watch TV, whether its watching the soap opera, watching their favorite sports games, watching movies or music videos. Advertising during commercials and the breakfast hours are a good way to promote new products. People can see what you are offering and why they should try your product. Another mass media is billboards on the way and inside buses and subway. Everyday people drive, and some people drive many miles away and get hungry and would like to what restaurant is on the nearest exit. By advertising on billboards, customers can see your products and location especially if they are hungry. 15.4 million Canadians drive a daily commute to and from work. Some Canadians drive about two hours from work and home and get home late. About an average of three quarters of commuters drive to work, most of them by themselves. Twelve percent of commuters take transit, Subway users spent an average of 44.6 minutes commuting to and from work. Light-rail, streetcar, and commuter-train take an average of 52.5 minutes to commute to and from work (Jones, 2013)

The three main Social media channels will be Facebook, YouTube, and Twitter these are direct marketing, and a way to promote products and services in a more relaxed environment (Hose, 2019). In Canada 94 percent of Canadians are on at least one social platform. Facebook is the reigning champ in social media popularity with 84 percent of online Canadians having an account with the social networking titian. 59 percent of Canadians use YouTube and 42 percent use Twitter in Canada (Spark, 2018). The two sales promotion that will be used will be to hand out coupons on the college campuses and in communities advertising the new products for 20 percent off regular prices for the bacon cheeseburger pizza to gain new customers. Coupons will also be taped on the outside bag or box as they receive their products. With the coupon they can purchase online and in store. A second sales promotion is that Domino’s will use a promotional card. Once a customer has purchased 5 items, they will get a free apple pie dessert pizza. By having the apple pie dessert pizza on sale for 30% off on Sundays and during holidays, Domino’s will encourage customers to buy the apple pie dessert pizza from the product line.

References

Domino’s Pizza (2019) Dominos history retrieved from https://www.dominos.com/en.aboutpizza/pizza-restaurant University of Cambridge (2016) Direct Observation retrieved from https://www.ifm.eng.cam.ac.uk/research/dmg/tool-and-techniques/direct-observation/ Salesforce (2019) The Customer Success Platform To Grow Your Business. Retrieved from www.salesforce.com/ Lotich,P. (2011, August 16).What is the Purpose and Advantages of Focus Group Interviews? Retrieved from https://www.socialmediatoday.com/content/what-purpose-and-advantages-focusgroup-interviews Martin. (2016, September 13) How to Perform a market research. Retrieved from https://www.cleverism.com/how-to-perform-market-research/ Spark. (2018, March 9) How does your social media use stack up against other Canadians? CBC Radio. Retrieved from https://www.google.com/amp/s/www.cbc.ca/amp/1.4569280 Hose, C. (2019, February 4). Top Ten Promotional Strategies, Retrieved from Https://smallbusiness.chron.com/top-ten-promotional-strategies-10193.html Fast Food Menu prices. (2019) Don’t Be Surprised by The Cost of Fast Food. Retrieved from https://www.fastfoodmenuprices.com/ Jones, P. (2013, June 26) Most Canadians drive alone to work| CBC News. Retrieved from https://www.google.com/amp/s/www.cbc.ca/amp/1.1367386...