Domino's Pizza to invest Rs 100 crore in a significant product refresh

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Domino’s Pizza, the market leader in the organized pizza segment, on Tuesday unveiled its most significant product refresh with an across-the-board enhancement of its pizzas.

The improvement to its pizzas include a new soft and tasty crust, more and bigger toppings, more cheese and a new herbier tomato sauce made from imported Californian tomatoes.

The launch of the All New Domino’s Pizzas will be supported by an aggressive advertising campaign across TV, digital, print and radio mediums. It will also be accompanied by a focused outreach effort targeted at its existing customers.

Domino’s Pizzas will now sport a new look and come in an attractive blue and white packaging that highlights the changes. Even after these improvements, the price of Domino’s pizzas will remain unchanged and this will help deliver better value-for-money to customers.

Talking about the new launch, CEO, Jubilant Food Works Limited, Pratik Pota, said, “Earlier in the year, we had unveiled our new strategy for driving sustainable, profitable growth. The key pillars of these were product improvement, Value For Money, Seamless Customer Experience and Superior Technology all enabled by a focus on cutting costs and driving efficiencies. As part of this strategy, we are pleased to unveil today the largest ever upgrade of our pizzas. The new improved Domino’s Pizzas will have a softer and tastier crust, more and bigger toppings, more cheese and a new herbier tomato sauce.”

He further added, “We will be investing nearly Rs 100 crore behind the upgrade. We believe that the vastly improved product will help both drive frequency among existing customers as well as attract new ones, and thereby expand the Domino’s franchise and help growth in the market.”

He emphasised that the brand has no plans to increase the cost of meal for the the consumers. They consumers can relish the better quality pizzas for the same amount that they used to pay earlier.

Domino’s pizzas will now come with a new soft and tasty crust that consumers will enjoy until the last bite. The sauce will now be made of Californian tomatoes and will be tastier, giving Domino’s Pizza a distinct herbier flavour. The quantity and size of the toppings across pizzas have also been increased along with the amount of cheese to provide the consumer with a more satiating and mouthful bite.

Speaking on the new brand transformation Senior vice President, Marketing, Domino’s Pizza India, S. Murugan Narayanaswamy, said, “India the last 20 years we have continuously adapted ourselves and brought the brand closer to our consumers, Our signature 30 minutes delivery promise and the launch of the Pizza Mania range are examples of this. The all new Domino’s is an outcome of insights gained from customer feedback, market research and store observations, Responding to specific feedback on the product gleaned from these, we have completely upgraded our product. We have planned a 360 degree marketing campaign ‘Aapne kaha, humne kiya’ around the same. We are confident that our customers will love the new, enhanced product.”

Four Pillars of Success

The four big pillars that have paved the path for a sustainable profitable growth for Domino’s are – driving innovation and product superiority, giving value for money to the consumers, ensuring seamless experience across all channels and leveraging technology along with cutting cost and driving efficiency.
The brand has been putting in a lot of efforts to improve its quarterly results like – the new chicken options have been introduced and it has resulted in surge in the growth curve; introduction of Everyday Value Meal and no price increase this fiscal year has improved the consumption frequency of the products along with improving the brand equity.
“Last year, Domino’s was doing a lot of deep discounting like one plus one offer but these were taking place on specific days of the month. So customers had to wait for a specific day to derive value. So the brand decided to change the strategy and introduced Everyday Value Meal,” revealed Pota.
Apart from this, the brand has also introduced delivery till 3:00 am at selected locations like Gurugram, Noida, Mumbai, Pune and Bengaluru and is looking forward to extend the services to other metro cities.
The brand has been leveraging technology in a big way. Average online ordering (OLO) contribution to delivery sales are expected to go up from 44 per cent in Q1FY17 to 51 per cent in Q1FY18. Whereas mobile ordering sales contribution to overall OLO is expected to rise from 41 per cent to 69 per cent during the same period and thew brand is assuming that the download of mobile ordering app will reach 7.5 million by Q1FY18.
Same store growth figures for the brand are -3.2 per cent during Q1FY17, 4.2 per cent in Q2FY17, -3.3 per cent in Q3FY17, -7.5 per cent in Q4FY17 and 6.5 per cent in Q1FY18. Whereas EBITDA margins of the brand are 9.5 per cent in Q1FY17, 9.7 per cent in Q2FY17 and Q3FY17, 9.9 per cent in Q4FY17 and 11.7 per cent in Q1FY18.
“Domino’s is looking to grow stronger by opening 40-50 new outlets this fiscal with a capex of Rs 85-90 lakh per outlet. The outlets will be spread equally between bigger and smaller towns,” Pota concluded.
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