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DOMINO'S PIZZA: BUILDING A DIRECT MARKETING INFRASTRUCTURE
SITUATION
Domino's Pizza, the world's #1 pizza delivery brand, had grown to more than 5,000 U.S. locations. Franchisees believed in promotional print and couponing as a sales-building tool, and the system invested close to $100 million in this type of local marketing. But without a common data platform and with 1,400 franchisees making their own decisions, all activities were planned and executed at the individual franchise level. Urban legend and vendor sales teams drove planning, and economies of scale were non-existent. Domino's had the customer knowledge and business model to be an effective direct marketer, but lacked the analytical tools and marketing infrastructure to get there. Domino's needed a new direct marketing delivery system.
FOUNDATION
RAZOR conducted a system-wide audit of local marketing activity and designed the blueprint for a three-year evolution from fragmented local couponing to data-driven direct marketing.
BLUEPRINT
While Domino's led the efforts to upgrade its internal systems with a proprietary point-of-sale system and new online ordering tool, RAZOR built and activated the franchisee marketing infrastructure:
  • RAZOR implemented measurement systems for all direct response activity.
  • Customer data is downloaded weekly to RAZOR for database management, modeling, segmentation and targeting. RAZOR built and fine-tuned over 25 targeting models to deliver greater response.
  • Infrastructure was built to deliver planning and execution support to franchisees at the individual, DMA or national level. DMA bylaws were rewritten to facilitate a shift from broadcast to direct response spending.
  • A national direct mail calendar was created to drive franchisee and co-op participation.
  • An every other week batch mail process was established (RAZOR OptiMail™). The process applies response models and variable printing to achieve the analytical sophistication and cost of a national event with the flexibility to execute on an individual store basis.
  • RAZOR led franchise collaboration on paid search and yellow page advertising.
  • Vendor rates were renegotiated based on consolidated volume.
RESULTS
Domino's is now a direct marketer with 1,400 decision-makers. Over 90% of the franchisees are users of RAZOR's system. RAZOR manages over 35,000 jobs annually with a 99.97% accuracy rate. Consolidation has delivered over $8 million in savings annually. RAZOR models have increased direct response ROI by 15 times. Individual campaigns have achieved as high as 45% response rate. Domino's sales are measurably higher during weeks with planned activity. RAZOR's paid search plans have delivered Domino's highest ROI of any media vehicle. Domino's National Ad Fund has committed to significantly higher investment in direct response marketing based on these results.
Domino's Pizza
CUSTOM BUILT MARKETING SOLUTIONS
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