The Domino's Pizza case can be found on Blackboard. Please read the case and review the case discussion questions at the end. These are good questions that we can use to discuss as a group and spark other conversations. Here is how the discussion will work:
Sunday: Question 1
Monday: Question 2
Tuesday: Question 3
Tuesday: Question 3
Wednesday: Question 4
As you will notice, some people have already commented from this past week. Feel free to comment on other people's comments and start new conversations around the Domino's business case.
As you will notice, some people have already commented from this past week. Feel free to comment on other people's comments and start new conversations around the Domino's business case.
Please have all your responds in by the end of Wednesday, 4/27, and I will send to Dr. Perkins.
Thanks,
Lora
Hi all,
ReplyDeletePlease give feedback on question #1:
Do you think it is wise for Domino's to stick to its traditional "home delivery" business model, even when that is not the norm in a country and when its international rivals have changed their format?
I think it is great that they are sticking with the home delivery model. If competitors have adapted their business models, then Domino's has achieved product differentiation without having to make any changes.
Delete-Andrea Smith
I think they should keep their home delivery business model. From looking at their performance, they have continuously improved in the long run. They offer toppings to accommodate customers in various regions of the world and look forward to being in the news rather than commercials to spread their word.
ReplyDeleteFrom additional research, Domino's also invests their money into technology such as Domino's DXP (fuel economy car which holds up to 80 pizzas) and robotic units (currently being tested in Australia) to continue their main focus, home delivery.
-Brigitte Zaman
That's a great point Brigitte. Keeping their focus on the core business model has allowed Domino's the opportunity to find innovations that will enhance pizza delivery.
DeleteI agree with Bridgette. Domino's should maintain their home delivery business model. Due to their widespread success with this model in foreign countries, they should maintain their profitable experience. Since Domino's is the only pizza chain in foreign markets with a home delivery model, one may consider this a niche market. A niche market is a subset of a market which is delivers a unique product or service. It aims at satisfying a specific customer. I do believe this business model should maintain course.
DeleteMisty Landor
76 quarters of same sales growth internationally tells me that Domino's made the right decision to stick to its traditional "home delivery" business model. Instead of changing its format Dominio's focused on other key areas of customer satisfaction (online sales & topping choices). This seems to be the correct recipe to attract and maintain its pizza customer base. Number don't lie.
DeleteKeeping the business model the same is wise as Domino's is able to standardize its model worldwide. While the concept of home delivery may be new to a culture, Domino's has demonstrated its knack for successful foreign entry into a market.
ReplyDeleteFor instance, where competitors have entered the market first, and changed their dining format, Domino's was a strong follower. They did not have to introduce a new product AND a new way to have a dining experience at the same time. By focusing on their model, this allows Domino's to focus on the ingredient differentiation that is crucial to their success.
Michael,
DeleteIt seems hard to disagree with how Domino's kept their traditional business model. Domino's has done a great job of differentiating their product in the different markets and adapting to the cultural expectations of how those people view pizza.
- John Hurd
Moving ahead to question #2, because the variables of pizza delivery are well known for the most part, that leaves understanding the culture of each market it enters as the challenging part.
ReplyDeleteMarket research into each country ties directly to their success. For instance, knowing that the Japanese value aesthetics is a key difference to understand. While the pizzas typically cost more, having slices of the equal size, with the same amount of toppings, is crucial for success. This is even more important that pricing. If it is not aesthetically pleasing, it would work well within the Japanese culture even if it were priced cheaply.
From an organizational perspective, Domino's knows that it wants to offer pizza. While the ingredients may vary, the pizza is basically the same. Domino's does an excellent job of knowing its customers. My presumption is that since no additional resources are spent modifying the business model, those resources are allocated to the marketing plan and market research.
I think Michael's assessment is spot on here. Domino's did the research and it has paid off in a big way. Research and local ownership allowed Domino's to see exactly what would and would not work in particular segments. They were able to make small adjustments to make them more favorable while staying true to their core principles.
DeleteNick Masterson
Q2:
DeleteFrom an organizational perspective Domino's has focused its efforts on social media. The Domino's App is one part of social media that has been used to accommodate cultural differences in tastes and preferences. By making this app user friendly customers are encouraged to use this technology to explore their options. Easily interacting with technology improves the customer experience in any culture. It also makes it easy for Domino's to gather data on its customer base. With this data Domino's can continue to modify its menu to better service customer needs in each country.
I think Domino's does a great job in altering their toppings to the country they are marketing to. As we have learned in class, sometimes selling a standardized product can be dangerous in foreign countries if it does not provide to the needs of the foreign people. Domino's has done their homework in R&D to determine what other countries like to eat. I also think their website is very user friendly as I have used it several times :).
DeleteI agree, I think Domino's seemed well prepared in gathering and collecting data before they launched internationally. It is important to have a firm base in the domestic industry beforehand. From research, the business was founded in 1960 and their international business launched in 1983 in Canada. Though Canada's market is similar to the American market, it took them at least 20 years.
DeleteAlong those same lines, I think that one of Domino's organizational strengths is knowing itself. When branching out internationally, the company stayed true to the things they know best - Italian-American dishes cooked efficiently. Knowing and building upon its core competencies has aided Domino's in its successful expansion into the international market.
DeleteI think that Domino's should try the sit down restaurant experience in at least one foreign country where it is valued to see how it would affect their sales. Some companies will change their business model to cater more to the country's culture they are entering in hopes for better sales. Seeing that Domino's is already proven to be a successful business with a presence in many foreign countries, I believe they are in a good spot to take a risk in changing their business model in one country to see what happens. For example, McDonalds is known as a fast food restaurant with a drive-thru. In Europe, most McDonald's do not have drive-thru because Europeans have the luxury of walking to most places and they enjoy sitting, eating, and talking. Taking away a drive-thru is also taking away the idea that the restaurant is a "fast-food service". This is an example of how a restaurant will slightly change their business model to adhere to the culture of a foreign country. Also, if Domino's competitor, Pizza Hut, is starting to differentiate themselves in international countries, then Domino's should closely examine their success.
ReplyDeleteThe Europe example is a very good one, especially when addressing large urban areas. The McDonalds that I visited in Rome was on the second floor of a building that no car could get to for a least half a mile (or 0.8 km, by their signage). I'm sure you're not exclusively referring to Europe, but which countries do you think value a sit-down experience that could sustain a business like Domino's?. Going by my Italy trip, an overwhelming majority of families ate nearly all of their meals at home, saving what we consider fast-food to be a semi-nice night out. I didn't have any experience with how working individuals spent their meal-times in Italy, but there was a siesta of sorts where most of the smaller towns I visited shut down and went home for lunch. Some dining establishments didn't open until after 2 or 3 pm.
DeleteAs we can still discuss question #1, please discuss your thoughts on questions 2-3 tomorrow night.
ReplyDeleteQuestion #2:
What do you think Domino's does from an organizational perspective to make sure that it accommodates local difference in consumer tastes and preferences?
Question #3:
How does the marketing mix for Domino's case in Japan differ from that in the United States? How does the marketing mix in India differ?
I think Domino's have continued to cater to the local culture and flare of the foreign country in which they enter. By producing pizza's that fit the local market taste, they have been able to be successful. For example, Domino's in India cater to their customers whom are vegetarian in order to match the preferences of the large Hindu population. Choosing toppings unique to a given area of the world and spice packets tailored to these areas also make people in specific markets appeal to Domino's.
DeleteDomino's has done a great job in adhering to the pressures from local responsiveness. They are changing their toppings according to what that target market likes to eat. In the United States, the pizza toppings consist more around meats such as pepperoni and sausage whereas in Japan it is more concentrated around fish as this is the diet of the Japanese. The same goes with India in the case that Domino's adds more spice to their toppings.
Delete#2 One thing that isn't mentioned in the article is how Domino's accommodates the tastes and preferences of it's employees, which has shown itself to be a valuable way to attract or retain customers. In America, Chick-Fil-A closes on Sundays to allow it's employees a chance to be with family. This move, despite missing an opportunity to make plenty in profits (to church-goers alone!), reminds consumers of Chick-fil-a's values and garners positive feelings. Domino's could do something similar by accommodating the diverse ethnicities they employ in a meaningful way.
Delete#3 Everyone else has already mentioned everything significant about addressing marketing mixes, but how they seek out those marketing mixes is important as well. One such method is fabricating reasons to enjoy pizza more frequently in Japan by shaping them differently on Mother's Day. India offers a difficult challenge by prompting customers to change their own habits of being responsible for mess clean-up. Given the rising number of Indians who are traveling abroad, Domino's could claim they are offering "international education" for those that will travel to the West, so that they might avoid any cultural embarrassment when abroad.
#4 By drawing upon Domino's willingness to stick with the home-delivery method of sales in China, despite Pizza Hut being there first, we learn that it's possible for a company to be a first-mover of sorts, even if someone else is selling your product first. Domino's simply had to evaluate the situation and discover what segment of the market wasn't being serviced.
Several of you mentioned the product, place, and promotion segments of the marketing mix. The price segment is a vital part of the marketing mix and is quite different in Japan than the U.S. In the United States, the chicken and bacon are considered "premium" toppings to pay extra for. This is a drastic difference from the $50 pizza in Japan with snow crab toppings. The article doesn't delve into price points of Indian stores, but based on the toppings offered, would likely be comparable to the U.S.
DeleteIt is wise for Domino to stick to its “home delivery” business model, that is what makes Domino different than his rivals. It is a risky move, but obviously, Domino succeed by combine the local culture into its product, using a sit down concept to promote its product and lower the cost by using local transportation tools.
ReplyDeleteAlso Domino using an efficient business strategy to attract and build customer loyalty and teach it’s customer to grow a habit, which makes itself unique and stand out among other brands.
-Ying Tu
Question 3
ReplyDeleteThe marketing mix for Japan is different from the marketing mix used in the United States. In terms of promotion, the strategy in Japan is centered around creating events that will create a buzz that will create more sales. This is a different approach from the one used in the United States that is based (mostly) on commercials but there has been more money allocated to commercials in Japan recently.
There is a big difference in price. It is considered acceptable to offer a $50 pizza. This would never fly in the United States.
The view of pizza from a cultural standpoint has altered the product in Japan. While the United States views pizza, for the most part, as low cost and relatively normal, it is considered upscale in Japan. This lead to more expensive and unique toppings.
Domino's has stayed true to it's distribution method despite the locale.
As far as India is concerned, Domino's is training their customers to enjoy a different dining experience instead of catering to what every other restaurant is doing.
They have altered their product to match the tastes of their customers by adding spicy oregano packs.
-Nick Masterson
I agree with Nicolas, as I been to Asia on multiple counts, pizza is considered quite "upscale". I understand where Domino's come from having to offer fancy topping such as snow crab or foie grass. In China, Pizza Hut has set up their restaurants where it is a lot fancier than what we have in the US. So it may not just be the customers Domino's has to keep up with but also to be in a position where they compete against Pizza Hut considering they sell the same products (though a different service concept).
DeleteIn India, their tradition is for restaurants to offer full service. Because that is not Domino's model, they gone a little out to offer tables to dine-in, without the service. As mentioned above, the toppings offered are the same, with a twist.
Hi Nick,
DeleteYou are absolutely correct. In Japan, Domino's created events that would appeal to the local customers; therefore making eating pizza an experience. Customers do gravitate towards products that are marketed as an experience than just a product. Experiences alters people perceptions of an product and establishes a theme around the product that makes it more appealing. I do believe Domino's has been successful in the Japan market due to this marketing strategy.
I think Domino's is taking a calculated risk in India as they offer the sit down tables but not the full dine-in service. I believe this offers a cultural difference that helps Domino's stick out in the Indian market place. Just as you go to a Japanese Steak house here in the U.S., partly for the quality food but also because of the different atmosphere associated with the restaurant. I think Domino's has capitalized on that different experience to help set it apart in India.
Delete- John Hurd
The key difference is the "product" being offered. High-end pizzas in Japan, vegetarian options in India, and home delivery pizza in the US. Domino's ability to successfully implement a localization strategy for each of these countries (while keeping the Domino's "core") is impressive.
DeleteQuestion 4:
ReplyDeleteI think there are a few lessons we can learn from Domino's in the international market place. One of those lessons is that it pays to either be a first mover or a strong follower. In either case, Domino's found a way to be the name in carry-out pizza in that country. Also, it is important to understand cultural expectations about your product. As mentioned earlier by a few people, the Japanese have a different expectation about the cost and reason to eat pizza compared to most of the world. It is very important to make sure you understand how your product will be perceived when you enter a new market.
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DeleteThe article states, they are definitely a first mover and strong follower in many countries. Domino's had already opened their first store in Haiti back in in 1993. As we stated in class, it is very difficult to do business in Haiti but Domino's was able to do it with the use of local entrepreneurs in the host country.
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DeleteQuestion #4:
ReplyDeleteWhat lessons can we draw from the Domino's case study that might be useful for other international businesses selling consumer goods?
Domino's has shown that adapting a core product to different countries pays dividends. This allows Domino's to focus on the core "pizza" product while tailoring to individual countries and cultures.
DeleteI think this Domino's case shows that it is not always the best strategy and use of resources to be the first mover. Why introduce a country to the concept of pizza and try to convince them to like it? Let another company spend the marketing money doing that and then follow behind with a quality offering that is slightly different than the first mover. This strategy could be very helpful to other businesses.
DeleteI think this case study would be useful to other consumer good restaurants who plan to expand internationally. Domino's is the perfect example to follow. Their concept of changing their toppings to satisfy their local customers is a smart business model.
ReplyDelete