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Marketing Strategy Sample: Domino's Pizza

Task: The next stage of the marketing audit is for you to consider the market for your organisation and evaluate the opportunities and threats that exist for your chosen organisation. NB: if you have a number of markets it is a good idea to focus on just one. 

Incorporating theoretical concepts into your discussion from chapters 2, 4, 5 and 6 of the text, and with the use of other theoretical sources and secondary research, please discuss the following: 

  1.  Briefly describe the industry market for your organisation and evaluate current trends in
    1. Growth
    2.  Profitability 
    3. Macro environment ( PESTLE factor) 
  2. Describe the nature of competition in your industry. Explain and analyse your organisation’s place in the market by comparing and contrasting its strengths and weaknesses to your main competitor. 
  3. Outline and examine the major market segments for your organisation and identify your primary and secondary target markets. 
  4.  Discuss the level of involvement your primary segment is likely to have towards your organisation in terms of the decision making. 
  5.  Taking into consideration the primary segment, their level of involvement and the competition, create a positioning map for the market place. 

You need to select an Australian based organisation or you could select an International organisation but it needs to have a presence in Australia. 

Given that companies usually have a wide product offering that may cater to different market segments, it is encouraged that you focus on 1 product / service to streamline your analysis.

Also, you need to select a B2C market so that you can profile your target markets effectively. 

More information on how to complete this assessment will be provided on Interact 2. 

Answer

Introduction

1.1 Company: The study is based on the strategic marketing analysis of Domino’s Pizza. The Domino’s Pizza Inc, which has been branded Domino’s is an American based multinational pizza restaurant chain introduced in the year 1960. In the year 2018, Domino's is stated as the largest pizza restaurant chain in the market in terms of sales figures. The present logo of the company has been three dots, which has represented three stores in the year 1965 (Agnes, 2016). The logo has remained similar till 2012, at present the logo has been changed in term of specifying more menus rather catering only pizza products. 

1.2 Locations, products or services:

The Domino's presents a different variety of menu representing preferences of tastes and regions. In the case of the United States, the currently the menu of Domino's pizza includes Italian-American tested and tried recipes. The Domino's is focussed on introducing traditional and custom based Pizzas with different toppings to add taste values for the customers (Syed, 2016). In the processing of baking pizzas, the focus of the entity is to introduce crust based pizza which could be suitable with the toppings. The most favourable Pizza within the consumers is artisan-styled pizzas. There are different pizza sides presented by the entity, including overbanked sandwiches, bread bowls and pasta. In the current menus, chicken sides, desserts and beverages are also added by the entity.

Locations: The first restaurant of Domino’s has been introduced in Ann Arbor, Michigan. Later the farm office park of Domino’s became it’s headquartered.  

1.3 Customer Analysis:

Initially, the customers of Domino’s are disappointed with its food and services as the company has its own weaknesses and issues. The pizza has been considered tasteless and unexciting food product by the customers (Kumar, 2015). The survey initiated in 2009 has stated that the company has failed to match its standard in terms of tastes and customer preferences. However, in terms of value and timely delivery, the company has been valued as a reliable brand. During the course of years, the company steady able to raise its taste values and customer preferences (He, Zha & Li, 2013). The entity has raised its delivery system and quality of the products, which has also helped to meet the expectations of investors. After a downfall, Domino's has been able to increase its market value and raised its brand positioning in the global marketplace. In 2016, the Domino's has been named as the second-largest pizza brand chain in the global market. Eventually, the rise in the performance and pace of growth and increased its share value to $160 in 2016, which has increased from $8 value in the year 2009.

Market trends and industry analysis 

In the era of 2009, the slowdown of global and domestic economy has badly affected the performance of Domino’s in the marketplace. Due to economic forces, other several adverse issues have been raised, which has affected Domino's brand in the marketplace (Ivy, 2013). The economic situation in the current market has been improved, which has also helped Domino's to raise its performance level within seven years.  

In the year 2008, the company sales have been made the growth of about 11% due to a unique strategy of home delivery services introduced by Domino’s (Kirkpatrick, Cuvelier & Flanagan, 2018). The adaptation of the home delivery system of the entity has soon become popular in the market that helped the entity to expand its business in 85 countries. The Domino’s total has about 5701 pizza outlets in total in the market. About 2800 pizza outlets are operating in the global marketplace; the rest of the 2900 stores are present in the United States only (Lambert, 2014). The company is opening more stores in different countries and cities to expand its reach in the market.   



Dominos Pizza revenue history        Dominos Pizza sales

The Domino's Pizza is considered as a second highest popular brand in the restaurant and fast food industry, giving tough and stiff competition to the rival organisation operating in the market. In the year 2017, the United States has along contributed about 9.86% to the total revenue generated by Domino’s from the market. In the present year, the total revenue of the entity is estimated $ 643.64, which is in growth rate (Lambert, 2014).   

PEST analysis: political, economic, social, technological    

Political factors: The political factors include regulatory frameworks which are governed and operated under the judiciary system has been impacting on the performance and operations of the company in the marketplace (Kraak et al. 2017). The changing regulatory frameworks have made adverse effects on business operations. In the management of political issues, the business entities such as Dominos might require to adjust its taxation norms and pollution policies for matching with the local government regulations.           

Economic factors: The economic forces are identified with the economic status and GDP rate of the country, where the business is operating in. The business organisation requires putting a potential performance in the economic areas where per capita income is higher; this means the income and spending power of the customers is higher (Sinha & Sheth 2018). In a survey, it has been observed that the customers are willing to pay in consumer goods, including food products more in the time of specific occasions or festivals. Additionally, the inflation rate of the country is considering factor which needs to be measured by Domino’s. The inflation rate can bring damage to the cost and pricing of the products, as a high rate of inflation increases the price of raw materials and so on affects the production cost of the entity.        

Social factors The Domino’s is one of the favourable, fast food chains in the marketplace that is labelled as a renowned brand in front of the customers. Due to its custom based and differentiated pizza products, the company is a lot in demand in western culture (Whiteley & Hessan, 2008). There are different class present in the society, middle class, upper class, lower class; the company might try to create demands in all three level of society. The organisation requires understanding social aspects, cultural norms, values, beliefs and religion while presenting its products in the market.       

Technological factors: The introduction of technologies has passed a differentiated scope to increase the quality of baking by introducing advanced heating and baking systems. The company always finds scope to use current technologies such as delivery system through drones, increasing customer relationship through social media networks such as Twitter, Facebook and others (Park et al. 2012). Inclusion of a management information system has enabled to collect, store and transfer customer data and ease the customer service for the organization. The technologies have also helped to make future forecasting for management of resources and raw materials to meet future customer trends. 

Market segmentation and analysis:

Market behaviour and customer segments

The Domino’s Pizza’s are purchased by the customers in the marketplace who are matched with the following behaviours of the customers. The buying behaviours of the potential customers are mentioned as following:   

  • Unmatched and complex buying behaviour
  • Reduced and dissonance buying behaviour 
  • Constant ad habitual buying behaviour 
  • Variety product seeking buying behaviour    

The behaviour of a customer reflects as per their choice of pizza they willing to buy. During the purchase, the customer prefers a reputed brand which defines their beliefs and trusts during their selection of proffered flavour or variety of pizzas. The customers in the market place change their tastes and preferences with time. Additionally, their consumption power and frequency also change with time. 

The switching of brands comes to the decision making of the customers when there is any dissatisfactory occurs (Collins, Chiang & Wajda, 2018). This dissatisfaction might be due to lack of quality, variety, tastes and preferences they found in the pizza menu served. However, Domino’s has introduced different verities of pizzas based on the preferences on location-based (Kumar, 2015). The customers usually find their preferred pizzas under Domino’s offerings, which has increased its reputation and positioning in the marketplace. The company has been able to meet the expectations of customers by providing the ultimate service of delivery within the provided time frame. The aim of Domino's pizza is to include a verity of pizza with traditional tastes and customer-based pizzas introduced, which is suitable with the toppings. The buying behaviour of the customers has significant and specific towards the purchase and preference of Domino’s Pizza. This means there has been a strong customer loyalty, which has been created by the business entity in the marketplace (Kirkpatrick, Cuvelier & Flanagan, 2018). In the year 2009, the company has not been able to match the standards and tastes due to the economic downfall. However, in the president market, the entity has been able to change the customer mind and increased its customer base in the market. 

Secondary and Primary markets: The behaviour of the customers are determined and identified with respect to their needs and requirements. The selection and targeting of the customers should be based on their preferences, purchase power and their progressive behaviour towards a specific product or services. Domino’s Pizza is described as one of the favourable brands in the market. Still, the management of the entity tries to observe and analyse the traits, preferences, choices, tastes and behavioural approach of the customers. It is necessary to match the attitude and behaviour of the customers based on the high calorie and healthy Pizza products within the customer's mind. The company has tried to highlight the healthy food and crust healthy brand in front of the customers, as the customers have become health conscious (Vargas-Hernández & Martínez, 2016). Due to the increasing demand for healthy foods, Domino's has also introduced some healthy and nutrition pizza’s for the families, so that they could meet the needs and requirements of the customs.  

The implication of decision making:

Due to rapid changes in the demands, tastes and preferences of the customers, the food industry is considered as a complex industry. The business entities operating within the industries require making regular research on customer requirements (Agnes, 2016). The industry is also considered a collective branding of a different business with different categories of food products. The agenda of the industry is to proved proper quality food produces for the population. 

In regards to providing quality products and services, the business entities have regularly analysed preferences tastes, expectations and attitudes of the customers. The customer behavioural approach is required to match with the availability of the products; the variety of products requires to be availed for meeting the expectations of the customers (Whiteley & Hessan, 2008). Else, the customers might intend to switch their brands in regards to meet their expectations. In the case of Domino's the management of the entity has made a thorough analysis of the customer expectation, based on which they have served quality and tasty Pizzas with a reliable delivery system. The company has introduced modern marketing tools and techniques and strategic applications for creating the market image of the entity. Customer orientation, pricing analysis, and ensuring modern services were considered during the implication of marketing strategies. 

Perceptual Mapping 

Perceptual map of Dominos Pizza        

According to the perceptual mapping, Domino's has been established in and as high price and high-quality brand. Domino's has been able to create its brand value as costing premised, high positioned and high-quality brand. The company has created its branding though ensuring an effective time delivery service quality brand (Park et al. 2012). In the minds of customers, the Domino’s has been able to create animate of high quality and aggressive brand which values and focused on its quality and fast delivery service. In the global market, the company provides a close ad stiff competition to its rival entities in the market ad stick to its leading position. The customer expectation could be met through two variables quality and pricing; Domino's applies high-end quality and icing aspects to meet the expectations.  

Conclusion 

The Domino's Pizza introduces a variant of Pizza products within which the most favourable product is artisan-styled pizza. The company is one of the leading producer of Pizza restaurant chain, which has high demand in the market and provides stiff competition to the key players in the market. In the case of marketing, Domino's Pizza is considered innovation strategy for creating and sustaining its image in the market. The management of the business is focused on inputting all the natural ingredients in regards to provide good quality and healthy foods to the potential customers. In relation to ensuring quality delivery of products, the company uses non-perishable products that might be matched with the corporate image in the market. The strategic application of the business is introduced for attracting the customers. The products are designed in such a specific manner which could attract the eyes of the customs so that the company can easily target the audiences, specifically young generation, adults and kids. The customers in Domino's are much welcomed to offer with products beyond pizzas such as pasta, oven-baked sandwiches, and variety of chicken, beverages, bread sides and different pizza sides. After a downfall in 2009, the Domino’s Pizza has slowly created its image in the marketplace. In the current market, Domino’s is considered the second-largest pizza fast-food chain in the global marketplace. The company has now introduced technologically advanced to increase the expectations of the customers. The situational analysis has suggested that the political and economic factors as putting some adverse effects which have affected the operational and production process of the business. However, from the past seven years with slow and steady growth, the company has been able to expand its business in the global marketplace. In the food industry, the rapid changes in customer taste and preferences have made the industrial complex. The company such as Domino's has made regular analysis and observation other tastes, traits, attitudes, preferences and behaviour of the customers. From the study, it has explained that it is important to analyse the customer behaviour and traits, Domino’s has tried to provide high calorie and healthy foods as per changing demands of customers and introduced high quality and price-oriented products for meeting their expectations.   

References

Agnes, M. (2016). Domino’s Pizza: A Look At the Timelessness of A Social Media Crisis Plan. Bamburry, D. (2015). Drones: Designed for product delivery. Design Management Review, 26(1), 40-48.

Collins, J., Chiang, C. W., & Wajda, C. (2018). U.S. Patent Application No. 29/574,802.

He, W., Zha, S., & Li, L. (2013). Social media competitive analysis and text mining: A case study in the pizza industry. International Journal of Information Management, 33(3), 464-472.

Ivy, M. (2013). Have you seen me? Recovering the inner child in late twentieth-century America. Social Text, (37), 227-252.

Kirkpatrick, J., Cuvelier, K., & Flanagan, J. (2018). Chartered Financial Analyst Challenge: Analysis & Research of Domino's Pizza.

Kraak, V. I., Englund, T., Misyak, S., & Serrano, E. L. (2017). A novel marketing mix and choice architecture framework to nudge restaurant customers toward healthy food environments to reduce obesity in the United States. Obesity Reviews, 18(8), 852-868.

Kumar, R. (2015). A comparative study between on pizza hut and Domino's Pizza. International Journal of Marketing and Technology, 5(9), 89-123.

Lambert, D. (2014). Domino's Pizza: A case study in organizational evolution. Oboulo. org Publications.

Park, J., Cha, M., Kim, H., & Jeong, J. (2012). Managing Bad News in Social Media: A Case Study on Domino's Pizza Crisis. ICWSM, 12, 282-289.

Sinha, M., & Sheth, J. (2018). Growing the pie in emerging markets: Marketing strategies for increasing the ratio of non-users to users. Journal of Business Research, 86, 217-224.

Syed, I. (2016). SWOT analysis and operation management decisions of Domino's pizza.

Vargas-Hernández, J. G., & Martínez, M. Á. P. (2016). Mergers and Acquisitions Strategies for Market Penetration in New Countries: The Case of Alsea Group. Regional Science Inquiry, 8(2), 55-64.

Whiteley, R., & Hessan, D. (2008). Customer-centered growth: five proven strategies for building competitive advantage. Basic Books.    

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