Dominos Pizza Enterprises Marketing Plan - Case Study Example

DOMINO’S PIZZA ENTERPRISES MARKETING REPORT Name: Course: Tutor: Institution: City and State: Date: Domino’s Pizza Enterprises Marketing Report Executive Summary Domino’s Pizza Enterprises is one of the largest fast food chains in Australia. It has more than four hundred stores in the country and provides clients with a wide variety of product choices. A SWOT analysis of the company reveals that most of its strengths come from its ability to conveniently provide varied products. The firm is currently facing significant threats from the rapid expansion of rivals as well as the ongoing campaign to introduce healthier eating practices around the developed world. A new product that would endear to its clients and untapped target markets is an app that would allow Domino’s customers to customize the pizzas that they order while looking out for their caloric intake, nutrition and price. This would help customers change current pizza options as it suits them and create healthier options for them. Introduction SWOT (strengths, weaknesses, opportunities and threats) refers to a type of marketing analysis that looks at various elements of a company’s operations to determine the strategy that the firm should use to grow its business. The analysis factors in the company’s strengths, weaknesses, opportunities and threats and tries to establish the best direction in which the firm should head. According to Pride et al. (2007, p. 51), strengths and weaknesses are crucial factors for a company because they affect its ability to meet the demands of the clients. Opportunities indicate the possibility for expansion and growth for the firm, while threats show the chances of the firm experiencing a decline in its business. A SWOT analysis can help a firm identify the areas that it should focus on if it is to achieve the desired levels of growth. Domino’s Pizza Enterprises is the biggest pizza company inside Australia, as it commands the largest portion of the market and has the most expansive network (Domino’s Pizza Enterprises Limited 2013b, p. 2). The fast food network is one of the fastest growing industries inside Australia, with pizza being a popular meal solution. Reports show that Australians are increasingly turning to fast food restaurants for their meals and this is contributing to the sector’s speedy growth. Currently, Domino’s sells more than seven hundred thousand pizzas per week and is the fifth largest fast food restaurant in Australia. Despite these positive figures, the dynamic nature of the food industry in Australia means that Domino’s needs to carry out a regular analysis of the market to make sure that it does not concede any ground to the competition. Through a SWOT analysis, the firm can establish the crucial areas that can help it grow and stay ahead of its rivals. SWOT Table Strengths Weaknesses Domino’s Pizza is able to provide customers with food that is prepared within a thirty-hour window, making their services convenient. Domino’s commands the largest share of the pizza industry in Australia, thus making them the dominant and trendsetting force in the market. Domino’s Pizza’s innovative nature has helped them provide their clientele with a wide array of products and services that meet different needs. The company’s operations focus mainly on the production of pizza, making Domino’s quite vulnerable to the possibility of a decline in the market. A lack of diversification in the company’s products means that some market demographics are virtually out of reach. Opportunities Threats As a product, pizza is capable of satisfying a wide range of customer demands, making it a preferable alternative to burgers, hotdogs and other kinds of junk food. The introduction of more healthy and low calorie pizzas could help Domino’s expand its market. The fast food industry is currently being targeted by the global discourse on healthy eating. The continued growth of other fast food sectors could see them usurp Domino’s customer base. Findings Strengths Domino’s has built a reputation for itself as a firm that is capable of producing pizzas at a very fast rate. This translates to increased convenience for the customers, an issue that is important within the fast food industry. This convenience is particularly important for people who do not have time to cook or wait for their meals in restaurants. It allows them to have their food as they are on the move or arrive home with their dinner in hand, without any need for preparation. Domino’s size and spread is another strength that the firm has. The company is the largest QSR (quick service restaurant) in Australia with stores covering every end of the country. It has more than four hundred stores in Australia and sells more pizzas than any other firm that deals with the product (Domino’s Pizza Enterprises Limited 2013a, p. 18). This dominance means that Domino’s is the firm that sets the trend in the market, with smaller companies left to follow or try and catch up to it. A key strength that Domino’s has is its ability to innovate and come up with new products that excite and appeal to a wide range of clients. Additionally, the company has embraced new technologies in the provision of its services, allowing clients to order pizzas through an array of media such as social networking sites, mobile applications and internet websites (Domino’s Pizza Enterprises Limited 2013a, p. 20). Weaknesses Domino’s scope is quite narrow as the company only focuses on the production and selling of pizzas. This makes the firm become vulnerable to any problems that could arise in the respective market. For instance, in a situation where pizza sales started to decline sharply, Domino’s would be at a loss for what to do next. Additionally, Domino’s focus on pizzas means that the firm is effectively locked out of any demographics that do not indulge in the item. This is because the firm has nothing else to offer those consumers who do not like pizza, or cannot eat it for any reason. Opportunities One opportunity that Domino’s has comes from the fact that pizza is unlike most other fast foods in that it can satisfy a wider range of consumers. Fast food meals such as hotdogs, burgers, French fries and fried chicken are disadvantaged in that they have narrow target groups. For instance, vegetarians cannot eat burgers or hotdogs, while people who are trying to mind their weight and diet are likely to shy away from fried foods like chicken and French fries. This means that Domino’s could come up with products that endear to such clients more. Another opportunity for Domino’s comes from the fact that they could increase the number of healthy or low calorie pizzas in their menu to reach out to clients who are mindful about their diets. This is unlike other types of fast food that would have trouble reaching out to such markets. Threats The continued growth of the fast food industry is a threat to Domino’s dominance in the market because other firms could try to gain ground on the company and reduce its dominance (Franchise Report 2013, p. 13). Additionally, the ongoing campaign to cut down on unhealthy foods threatens to affect Domino’s operations because most items on the company’s menu fall on the wrong side of the obesity debate. Recommendations Target Market Market segmentation is an important process that firms carry out when formulating business strategies. Kotler and Armstrong (2008, p. 191) state that the process involves the division of markets into different groups of consumers based on important variables that involve the customers’ needs, traits and activities. These variables help to determine the sort of products that each group of consumers would be interested in and the kind of marketing that appeals to them. Three key issues stand out for customers in the industry are convenience, diversity and price. Domino’s clients look to the restaurant to satisfy a wide range of tastes and preferences at a low price. Additionally, the restaurant should be able to prepare food that the customer can receive in a short amount of time. One of the most important target markets for Domino’s is the teenage demographic, with younger people providing a large portion of the clientele that the firm, and other fast food chains, deals with (Yale Rudd Center 2013, p. 3). The teenage demographic is complicated for two reasons. Firstly, the parents of the teenagers play a role in determining the food that their children will eat. This means that the firm needs to market the products in a way that they will appeal to both the children and their parents. Secondly, the teenage demographic is quite dynamic, with their needs and demands changing frequently as they age (Yale Rudd Center 2013, p. 4). A new issue related to the teenage demographic concerns that provision of food that is healthy and low in calories. This will help quell concerns regarding the diet of teenagers and the fears of an increased risk of lifestyle diseases in younger people. New Product Description Any new product for Domino’s Pizza would have to increase the healthy meal options that the chain offers its clients. New products are a good way of improving a company’s services because they increase the options ad solutions for the clients. One new product that Domino’s should introduce is an app that allows clients to design their pizzas by choosing every ingredient that is included into the product. This app would be distributed on all mobile platforms and made available on Domino’s website. The key feature in the app would be a calorie and nutrients counter that would allow the clients to monitor what they are eating. Through the feature, clients would be able to place a limit on the calorie in their pizzas and watch their diet in the process. The app would also make it possible for people to customize pizza choices that already exist so that they can remove specific ingredients that they do not like. The counter feature would also estimate the price of the pizza that the client is designing so that they can make sure that remains within their intended price limit. Through this app’s special features, Domino’s would be dealing with two key issues of the marketing mix, price and product. Customer Value Proposition The new app would provide value product for the customer by helping them create the pizza that they specifically want while providing them with relevant knowledge about their nutrition and price. This would prove particularly useful for customers who are keen on price, nutrition and caloric intake. The customer would have the option of taking a pizza that they like and then choosing the various elements that they want to remove from the pizza. This way, clients can remove specific ingredients that make their pizzas become more expensive or increase the caloric count and replace them with more preferable alternatives. This will endear to those customers who are conscious about their weight, health and budget. Justification of the New Product The product is a necessity in the current food industry as different entities raise concerns about the increase in lifestyle diseases, particularly in children. By allowing people to make their own pizzas, it increases the options that they have making it more likely that a client will be satisfied with Domino’s products. The product specifically applies the strengths-opportunities strategy. It takes advantage of Domino’s ability to provide a wide variety of diverse pizzas and combines it with the opportunity to introduce healthy products. This strategy can help Domino’s expand its target markets to include people who were previously excluded because of budgetary and dietary reasons. References Domino’s Pizza Enterprises Limited 2013, 2013 Annual Report, Domino’s Pizza Enterprises Limited, Hamilton. Domino’s Pizza Enterprises Limited 2013, The Facts, Domino’s Pizza Enterprises Limited, and Hamilton. Franchise Direct 2010, Pizza Franchise Industry Report, Franchise Direct, Atlanta. Kotler, P & Armstrong, G 2008, Principles of Marketing, Prentice Hall, New Jersey. Pride, WM, Ferrell, OC, Lukas, BA, Schembri, S & Niininen, O 2007, Marketing Principles, Cengage Learning, Melbourne. Yale Rudd Center 2013, Fast Food Targeted Marketing 2012-2013, Yale Rudd Center, New Haven. Read More