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Domino’s cooks up more than 20pc of digital sales from mobile

May 2, 2012

Some Pizza Hero players are being encouraged to apply for a job

Domino’s Pizza was quick to embrace mobile as a way to enable customers to place orders and the numbers speak to the company’s success, with 7 percent of total U.S. sales and more than 20 percent of digital orders now taking place via the company’s mobile site and apps.

The pizza delivery and restaurant chain reported its first quarter results yesterday and pointed to its significant success in mobile in a conference call with analysts to discuss the results, including that mobile is helping Domino’s extend its brand internationally. Domino’s launched its iPhone app in Britain in September 2011 and mobile now accounts for 16 percent of total digital orders there.

“We’re north of 30 percent in online orders,” said Patrick Doyle, CEO of Domino’s Pizza, Ann Arbor, MI.  “A year ago, we were 5 points lower than that in the 25 percent range.

“The other thing that has moved along briskly, is the mobile side of this,” he said. “Seven percent of total orders are on mobile.

“We are looking at better than 20 percent of digital orders on mobile.”

Mobile a hero
In the first quarter, Domino’s launched its new Android app and it already accounts for 1 percent of sales, Domino’s executives reported yesterday. The company previously noted that the app exceeded 140,000 downloads in its first two weeks of availability.

During the conference call, Domino’s executives pointed to other ways that the company is innovating with mobile such as its new Pizza Hero iPad game. The app, which was launched a year ago, enables fans to create virtual pizzas.

A recent update to the game encourages players who make it through several pizza-making challenges to apply for a job at the chain. While Mr. Doyle said he not expect a significant number of employees to be hired from the app, it shows how mobile is at the core of much that the company is doing these days.

“Domino’s has done a great job in mobile across mobile Web for smartphones, and apps – the QSR space is such a great opportunity for mobile, and is just now starting to show growth, with the percentage that Dominos is reporting on mobile now, while it is a good number as consumer adaption to smart phones grows exponentially it is only the starting point, and over the next two to five years will be a much larger percentage of their overall sales,” said Marci Troutman, CEO of SiteMinis, Atlanta.

“Continuing to R&D the mobile space and their strategy as this grows will be critical to keep the momentum up with the ever growing demands of the consumer market,” she said. “The consumers are what is driving mobile growth in the U.S. much more so than businesses.”

For the first quarter ended March 25, 2012, Domino’s posted domestic same-store sales growth of 2 percent while international same-store sales increased 4.7 percent. Revenues were down 1.2 percent for the quarter.

Domino’s has also seen success with its iPhone and iPod touch app, which achieved $1 million in total sales in just 28 days. Just three months after its release, the app achieved more than $1 million in sales in a single week.

Mobile strategy
The pizza chain is embracing mobile in other ways, too. In January, Domino’s teamed up with the Blippar app to create an augmented reality experience at various locations across Britain (see story).

Other quick-service restaurants have also been actively embracing mobile to drive orders and engagement, including Papa John’s and Pizza Hut.

“Domino’s is not only capturing their loyal customers with an app and a fun experience, but it is also paying attention to those customers that haven’t yet become their loyal customers – which is a larger pool of consumers – with the mobile web experience, making sure that they are paying attention to these customers will allow them to transition more of the mobile web consumers to their loyal customer base,” Ms. Troutman said.

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