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Domino’s Pizza exec: Mobile commerce growing at astounding rateBy
Domino’s Pizza is driving traffic to its newly optimized mobile Web site with mobile advertising and seeing a surge in revenue from its mobile commerce platform.
While the pizza franchise continues to invest heavily in traditional media, it has seen significant growth from its mobile initiatives and plans to increase its investment in the mobile channel going forward. In addition to promoting its mobile site on Dominos.com and via email blasts, the company partners with mobile ad networks and with publishers directly to run banner ads across most of the top 10 mobile Web sites in the United States, including Pandora, ESPN and CNN.
“Mobile is a rapidly growing segment of our business, one that we expect to grow for years to come,” said Rob Weisberg, vice president of multimedia marketing at Domino’s Pizza, Ann Arbor, MI. “A major growth agent for our company over the last few years has been online ordering in the digital space.
“As more consumers are walking around with smartphones, mobile will be an increasingly major area of growth for the organization,” he said. “Mobile commerce today in the U.S. is still in its infancy, but it’s growing at an astounding rate.
“A lot of what we get to see that’s occurring in our Asian markets and places like Iceland—mass consumer adoption of mobile commerce—it’s a crystal ball for what’s to come in the U.S. market.”
Through its primarily locally-owned and operated franchised system, Domino’s operates a network of 8,773 franchised and company-owned stores in the United States and 60 international markets.
Domino’s Pizza had global retail sales of over $5.5 billion in 2008, comprised of nearly $3.1 billion domestically and over $2.4 billion internationally.
In March, Domino’s selected Air2Web to power its roll-out of a mobile coupon program that now serves its franchises nationwide (see story).
Mobile coupons have been increasingly relevant for consumers—and thus an increasingly effective tool for brands—during the current recession (see story)
Domino’s mobile coupons are tailored to consumers’ ordering history and are often time-sensitive.
“We send out coupons via SMS that are relevant to you as an individual, an offer that’s strong and takes you to the site and all you have to do is hit confirm,” Mr. Weisberg said. “As far as our system-wide average, 85 percent of our business is delivery, and because of that, we know who you are, your name, address, phone number and what you’ve ordered in the past.
“Data sources such as Acxiom, Experian and Trans Union provide marketers with a rich set of data regarding demographic information, and that combined with past behavior, what each consumer has purchased from Domino’s via phone, online or mobile, that’s in our computer system,” he said.
“It’s an opt in relationship—we don’t spam anybody, they have to go to our mobile site or Dominos.com to opt in, and having done so, they’re entrusting us with that personal information.”
Mr. Weisberg says that marketers must appreciate the level of trust that opting-in requires, and not abuse that trust.
“A lot of marketers out there violate consumers’ trust by hitting people over the head with messaging, to the point that it’s intrusive,” Mr. Weisberg said. “I expect that if I give you my cell phone number, you’re not going to abuse that privilege, and that you’ll use it to send me relevant, valuable offers.
“By opting in to receive these communications, you’re ensuring that you’ll receive the strongest deals Domino’s has to offer, mobile coupons that link directly back to our mobile ordering site,” he said. “In terms of ease and convenience of the transaction, mobile commerce can’t be beat.”
Consumers can enter their credit card directly from their mobile device, and once they have ordered from that device once, Domino’s recognizes that consumer’s number.
Due to security safeguards, Domino’s cannot store credit card information to enable one-click purchasing, but if consumers want to pay in cash, it takes two clicks on their mobile device to place an order.
Domino’s asks consumers to verify the address on file and their previous order to finalize the transaction.
“You could be stopped at a traffic light and order before the light turns green,” Mr Weisberg said.
In addition to mobile coupons, Domino’s drives traffic to its mobile commerce site via mobile banner ads.
“We were the first brand out there to partner with and advertise on Pandora, which is the largest mobile music site in the world, and we buy inventory on most of the top 10 mobile sites in the U.S., including ESPN and CNN,” Mr. Weisberg said.
“We continue to expand our mobile advertising initiatives, because the growth of the channel ultimately demands it,” he said.
Last month, Domino’s Pizza launched optimized versions of its mobile site for feature phones, Apple’s iPhone, Google’s Android devices and the Palm Pre. A BlackBerry-optimized version is still in development.
“Our new iPhone-optimized mobile experience is part of our strategy to go as wide and as deep into the mobile community as possible,” Mr. Weisberg said. “IPhone applications get a lot of press, and while they certainly have some pretty cool, interesting applications out there for entertainment, to balance finances or find the nearest gas station, the challenge is putting them out there and getting consumers to and download that application onto their handset and actively engage with it.
“The vast majority of mobile consumers, especially iPhone users, are going to Web sites using their handset, so Dominos.com identifies what device you’re accessing our site with, and we deliver an experience that’s optimized your device,” he said.
“It doesn’t require you to download anything or register, and anything you want to access from Dominos.com is there.”
Mobile Pizza Tracker
The Pizza Tracker function was a featured during the launch of the optimized versions of Domino’s mobile site.
“You can track the order using the Pizza Tracker, which gives you updates in real time as to what stage of the process your pizza is in, from making to baking and delivering,” Mr. Weisberg said.
Domino’s Pizza Tracker technology lets customers to follow the progress of their order online or via their handset from the time they click the “Place Order” button or hang up the telephone until the Domino’s delivery employee is knocking on their door.
Once customers place an order, they can go to http://www.dominos.com using their computer or mobile device and click on the Pizza Tracker icon. They will see a horizontal bar that lights up red as each step in the process is completed.
Customers will see confirmation of their order being received by the store, when it’s being prepared, when it’s been placed in the oven, when it’s been boxed and placed in the Domino’s HeatWave delivery bag and, finally, when it’s on its way for delivery.
Pizza Tracker is currently available at more than 3,200 Domino’s Pizza stores in the U.S. that use the company’s Domino’s Pulse computer system.
The list of stores adding the Domino’s Pulse system is growing every month.
Pizza Tracker is linked directly to the computers inside the pizza stores using Domino’s Pulse and is accurate to within 40 seconds, according to Domino’s.
Additionally, while using Pizza Tracker, customers will be able to provide feedback online, which will go directly to the store to be viewed by the store manager.
That kind of feedback will allow the stores to quickly resolve customer service issues and help improve customer loyalty, according to Domino’s.
Exciting growth potential
In the U.S., many consumers have downloaded ringtones, wallpapers, songs and inexpensive applications, but there hasn’t been a tremendous amount of ecommerce via mobile devices in the U.S., according to Domino’s.
However, mobile commerce is picking up momentum in the U.S.
“A lot of that has to do with recent upswing in the adoption of smartphones,” Mr. Weisberg said. “We don’t expect people to buy cars via mobile, but the pizza category certainly lends itself to selling via the mobile channel, so we expect astounding growth.
“In terms of people making purchases via mobile commerce sites, we expect year-over-year double-digit growth over the next couple of years, we’re talking growth of 80, 90, even 100 percent a year,” he said.
“We’ve already doubled last year’s sales total via mobile devices and we’re still not even close to the end of the year.”
Domino’s believes that the importance of the mobile channel for its bottom line will only continue to grow.
“What gets us excited about the mobile space? You walk out of your home with your wallet, your keys and a third-screen—the three screens are TVs, computers and smartphones with a data plan,” Mr. Weisberg said.
“People are taking that third screen wherever they go, and mobile phones are one of the few things that aren’t shared, so we know exactly who we’re talking to via that mobile device,” he said.
The hectic pace of modern life also makes mobile an indispensible channel for businesses.
“Consumers are time starved, and as far as making meal decisions, 72 percent of consumers don’t know what they’re going to have for dinner at 4:30 p.m.,” Mr. Weisberg said. “Most people don’t plan that far ahead because of the time-starved nature of the world today, so our goal is to connect with consumers around that time of day, which is a major objective for QSR companies like us.
“The mobile screen is an opportunity to engage with them in a way that is relevant to them via SMS offers, mobile coupons,” he said.
“I’m hungry and I want something that’s convenient and good that my family will be happy with, and now I can order that wherever I happen to be using my handset.”
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