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Assignment 3 Case Study Launching a new product-line by a leading pizza chain Domino's Pizza, Inc., branded as Domino's, is an American multinational pizza restaurant chain founded in 1960. The corporation is headquartered at the Domino's Farms Office Park in Ann Arbor, Michigan and incorporated in Delaware. In February 2018, the chain became the largest pizza seller worldwide in terms of sales. Domino's Pizza opened its first franchise location in 1967, and by 1978, the company expanded to 200 stores. From its founding until the early 1990s, the menu at Domino's Pizza was kept simple relative to other fast-food restaurants, to ensure efficiency of delivery. Historically, Domino's menu consisted solely of one style of pizza crust in two sizes (12-inch and 16-inch), 11 toppings, and Coca-Cola as the only soft drink option. The first menu expansion occurred in 1989, with the debut of Domino's deep dish or pan pizza. Its introduction followed market research showing that 40% of pizza customers preferred thick crusts. The new product launch cost approximately $25 million, of which $15 million was spent on new sheet metal pans with perforated bottoms. Domino's started testing extra-large size pizzas in early 1993, starting with the 30-slice, yard- long - "The Dominator". Dominos tapped into a market trend toward bite-size foods with spicy Buffalo Chicken Wings, in August 2002. The breaded, baked, white-meat fillets, similar to chicken fingers, are packaged in a custom-designed box with two types of sauce to "heat up" and "cool down" the chicken. In 2008, Domino's once again branched out into non-pizza fare, offering oven-baked sandwiches in four styles, intended to compete with Subway's toasted submarine sandwiches. In December 2013, Domino's Pizza unveiled its first vegan pizza, which uses a soy-based cheese substitute, currently supplied by the UK company VBites. Crisis & redemption In a 2009 survey of consumer taste preferences among US national chains by Brand Keys, Domino's was last — tied with Chuck E. Cheese's. In December that year, Domino's announced plans to entirely reinvent its pizza. It began a self-critical ad campaign in which consumers were filmed criticizing the then-current pizza's quality and chefs were shown developing a new pizza. The new pizza was unveiled that same month. The following year, 2010 and Domino's 50th anniversary, the company hired J. Patrick Doyle as its new CEO and experienced a 14.3% quarterly gain. While admitted not to endure, the success was described by Doyle as one of the largest quarterly same-store sales jumps ever recorded by a major fast-food chain. International expansion On May 12, 1983, Domino's opened its first international store, in Winnipeg, Manitoba, Canada. By 1995, Domino's had expanded to 1,000 international locations. In 1997, Domino's opened its 1,500th international location, opening seven stores in one day across five continents. By 2014, the company had grown to 6,000 international locations and was planning to expand to pizza's birthplace, Italy. In February 2016, Domino's opened its 1,000th store in India. As of October 2019, Domino's Pizza China now has about 250 stores in 9 cities. In China over 90% of orders come from digital. Domino's Pizza China has specially developed popular American style potato bacon pizza, crayfish crispy and tender chicken pizza, durian pulp pizza, salted egg yolk pizza as well as Sichuan pepper flavour tender chicken drumsticks. 30-minute guarantee Beginning in 1973, Domino's Pizza offered a guarantee to customers their pizzas would be delivered within 30 minutes of placing an order or they would receive the pizzas free. The company continues to honour the 30-minute guarantee for orders placed in its stores located in other countries like Vietnam, Mexico, China, and India. The 30-minute guarantee is subject to the terms and conditions applied in the respective country. Innovation • In 2008, Domino's introduced the Pizza Tracker, an online application that allows customers to view the status of their order in a real time progress bar. • The first Domino's with a dining room opened in Stephenville, Texas, giving the customers the option to either eat in or take their pizza home. • In 2015, Domino's unveiled a "pizza car" that can carry 80 pizzas, sides, 2-liter bottles of soda, and dipping sauces. It also has a 140-degrees Fahrenheit oven on board and is more fuel efficient than a standard delivery car. Once each car reaches 100,000 miles, it will be retired and returned to Roush, where it will be returned to stock form. • In February 2017, Domino's launched a wedding registry with gifts delivered in the form of Domino's eGift cards. Dominos also created a pizza-themed baby registry. Customers have the option of signing up for Domino's pizza package to be served for the event. • In June 2019, Domino's announced a partnership with robotics company, Nuro. The service is slated to launch in Houston, Texas with Nuro's custom, self-driving pizza delivery vehicle, R2. Dominos Australia Domino's Pizza Enterprises Limited (DPE) is the largest pizza chain in Australia in terms of network stores numbers and network sales, as well as the largest franchisee for the Domino's Pizza brand in the world. DPE is the exclusive master franchise for the Domino's brand network in Australia, New Zealand, Belgium, France, The Netherlands, Japan, Germany, Luxembourg and Denmark. Across these markets, DPE has over 2,600 stores. In May 2005 DPE became the first publicly listed pizza company in Australia. The first Domino's store to open in Australia was in Springwood, Queensland, in 1983, and offered home delivery after home delivery was introduced into Australia by the Pizza Oven Family Restaurant in Holland Park Brisbane in 1981. The Australian and New Zealand Master Franchise was bought by Silvio's Dial-a-Pizza in 1993 and in 1995 the two brands merged and rebranded as Domino's Pizza. Currently, there are around 700 Domino's stores in Australia, making it the biggest pizza franchised business in the country. The Australian stores are spread right across the country, from the main capital cities like Melbourne, Adelaide, and Sydney, to more rural areas like Armidale. New Desserts line: Italian style Gelato In summer 2021, after more than a year in development and testing, Dominos Australia is planning to launch nationally its new line of desserts – single-serve Italian style Gelato in 4 flavours: ‘Chocolate-vanilla indulgence’, ‘Cappuccino de la casa’, ‘Banananisimo’ & Strawberry Delight’. The new Gelatos will be produced and packaged by one of Australia top ice-cream manufacturers, under exclusive agreement with DPE. The ice-cream is rated premium and is rich with cream and indulging ingredients (i.e. nougat, cashew, rich chocolate flacks, etc), the desserts will be priced at 7.95 AUD (current deserts on Dominos menu are 4.95 AUD). The marketing department of DPE has recently published a tender, to recruit an advertising & communication agency, to prepare and run the launch of the new Gelato line. The company’s brief listed the following as key objectives for the campaign: 1. Create awareness to the new desserts among prospective customers 2. Differentiate the gelatos from desserts offered by competitors 3. Encourage customers ordering pizzas to try out the new Gelatos Questions (in brackets – proposed word count) Q1). Segmentation & targeting: A. Define and describe the target audience for the new Gelato deserts, use a multi- dimensional framework (i.e. demographics, socioeconomic, behaviouristic, etc.) B. Identify strengths & weaknesses of the product-line. C. List opportunities and threats in the various environments & relevant consumption trends in the food & hospitality markets. (250-300 words) Q2). Communication strategy for the product launch campaign: Use the message strategy statement provided in Week 5 slides, to define the Unique Selling Proposition (USP) / key communication claim. Explain the main benefit that should be in the heart of a marketing communication campaign, support your choice and give ‘reasons to believe’ your key message. (150-200 words) Q3). Creative concept: A. Describe the ‘big campaign idea’ – a creative concept to entice the target audience. outline major consumer insights supporting your campaign idea. B. Determine the type of appeal to be used for the campaign – rational / emotional; Choose a specific appeal to be utilised in your ads; reason & support your choices. C. Demonstrate/ describe creative execution in two different media channels (I.e. 30’ Video commercial, radio commercial, digital campaign on social media, outdoor/newspaper ad, etc.) (250-300 words) Q4). Integrated Marketing Communication (IMC) vehicles: A. Propose advertising media channels to be used during the campaign (both digital & traditional). Justify your choices and explain the utility of each channel. B. Suggest marketing communication vehicles, beyond advertising (I.e. direct marketing, sales promotion, PR, events & sponsorship, point of purchase marketing, etc.), to be used in an IMC campaign. Justify your choices and explain the utility of each vehicle. (250 words) Q5) Ethical and Social Considerations: Consider potential ethical marketing impacts of the new product line and the proposed IMC campaign. Raise ethical and social issues and ways to address them. (100-150 words)