Domino effect...

IIPM, GURGAON

But isn’t Big Mac (McDonald’s) considered the most economical product in the QSR category? And if Domino’s is intending to compete with dosa and chole batore, then what about Mac Aloo Tikki Burger? Well, the competing products do remain, and some other competitor will surely launch a similar low-priced product soon, but Domino’s wants to do more... It plans to lure consumers with new launches through 360 degree ad-campaigns coupled with a new tagline ‘kushion ki delivery.’ Dev Amritesh, CMO, Domino’s Pizza India Ltd., while explaining the concepts behind the new TVC, points out that, “The new tagline & promotional acts would address the emotional proposition more, and that’s the reason we say kushio ki delivery...”

The strategy is clearly to cajole the consumers emotionally, but at the same time the company is not planning to do away with its on-time delivery anytime soon. After a clear dominance in the home-delivery segment, the real question that comes in mind is its future plans to improve its situation in the ‘sit & dine’ segment. “We are doing phenomenally well, in the sit & dine segment too, in which we grew by 55% over last year. Specially in tier-II cities like Nasik, Panipath et al, our restaurant segment is really doing well,” claims Ajay. Not a hollow boast, as Domino’s is aggressively mushrooming even in those places where others haven’t forayed-in yet. For numbers, Domino’s has rolled out as many as 210 stores across the country (Pizza Hut has 100 stores, McDonald’s 130) and in most of these towns & cities, where Domino’s is having a roll, Pizza Hut isn’t present yet!

Financially, launching a typical Domino’s outlet (being smaller than a Pizza Hut outlet), requires lesser capital. But that really doesn’t tantamount to an advantage as my Sunday dinner proved... Therefore, besides multi-locational expansions, Domino’s should immediately upgrade all its stores, as an industry analyst warns, “In the hospitality segment, a slight difference in service from a well-known brand can prove a disaster...” But then, it’s also true that in places like tier-I and tier-II, where Pizza Hut is absent, Domino’s is having a gala time. With the sit & dine segment contributing to 35% of its total turnover, Domino’s can’t let the ‘golden pizza-laying hen’ advantage fade away.

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Source : IIPM Editorial, 2008

An Initiative of IIPM, Malay Chaudhuri and Arindam chaudhuri (Renowned Management Guru and Economist).

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