What’s in the box with the dots?
by Keris Lahiff
One of Australia’s great app success stories is the Domino's Pizza app – number one free app within five days of its launch, championed by Apple in one of its campaigns, and a market-first innovation now employed in markets worldwide.
Speaking at CeBIT 2011, Domino's Pizza CEO Don Meij outlined why the app was a breakout success, how it has improved business-consumer relations and the lessons the publicly listed pizza joint learnt in the process.
Since launching its website five years ago, Domino's has broadened its digital strategy to encompass a mobile ordering site, launched in May, the well-received iPhone app and future apps on Android and tablet devices.
“It’s part of our strong mobile push as we look to Android and Windows 7 and a specific iPad app later this year,” says Meij.
Creating the iPhone app
The iPhone app, launched in November 2009, was an Australian first and signaled the business' first entry into the mobile space.
“Because of the enrichment on the iPhone, we thought it was the best place to start and that’s paid off,” says Meij. And the figures are there to prove it: the app, designed and created in Australia over six months, cost $250,000, and, while they forecasted a return on investment over three years, paid for itself within 12 months.
“The primary message was ‘order anywhere, anytime and have a Domino's store in your pocket’. The goal was to be first to market, to provide incremental lift in digital sales and to be the number one free app in the Australian app store on launch,” he says.
Today, 40 per cent of all Domino's sales in Australia are digital and of that, 26 per cent are mobile. With the launch of the mobile site in May, Domino's online ordering system is more accessible than ever.
“Mobile commerce is our future – we forecast now that our business will be 60 per cent digital within another two years and half of that will be mobile, at which point mobile will then surpass your PCs and laptops,” he says.
And, because the Domino's app was the first pizza ordering application on the market, it received a wealth of free press coverage.
“We received over $750,000 worth of PR coverage when we launched – that sort of stuff, even for a company our size with our budget is very, very material,” he says. “It created a lot of awareness and things that we didn’t expect. It actually gave us service ratings, so when we did post-research we were quite amazed that people had thought Domino's’ service had improved because we had made ourselves more accessible.”
Within five days of its launch, the Domino's app became the number on free app on iTunes. By the first month, it had achieved 115,000 downloads.
The creation of a Domino's app allowed customers to do things they couldn’t when placing an order through the traditional channels, says Meij. And the benefits aren’t just to the consumer – Meij has seen substantial benefits to the business.
The time tracker, an Australian innovation now in Domino's markets internationally, allows the customer to place an order and track its processing in real-time.
“It empowers the customer. One of the biggest disadvantages of a pizza order from Domino's is it’s made fresh to order so unlike burgers and chicken and sandwiches where you can get them premade or they’re made in a few minutes, a pizza order does take about 10 minutes to make and bake fresh,” says Meij. “We’ve given customers back their time … It might sound strange but if we quote 30 minutes and arrive in 15 minutes, that’s just as annoying to most of our customers than if we promise 30 and arrive in 45 because we’ve literally compromised what they’re trying to do with their time.
“It communicates direct with the stores from point of sale so it’s real-live updates,” he says. “Some people have thought is it an illusion, is it just a gimmick? But no … all the status is produced by the actions of the staff.”
Functionality above all else was an important consideration when building the app. Figures released in 2008 showed Australia was the second-largest cash society in the Western world (the first being Italy) so the Domino's app bypassed the need for credit card payment to place online orders.
“In fact, 60 to 70 per cent of our sales go through our digital platform with cash, a major advantage and also one of the reasons why we have such high penetration,” he says.
The greatest benefit, says Meij, is the ability to customise the product to suit individual tastes.
“Most customers customise their pizzas when they’re using digital versus on the phone. When you’re on the phone you’ve got language barriers, you’ve got memory loss and your pizza experience is something you don’t give a lot of thought about so you can’t always remember what’s on the menu,” he says. “With the digital platform it’s very easy to see how you can customise in literally over a million ways.”
Of course, this also has a clear business benefit.
“The customer actually spends more because often they’re actually adding more to a product. A standard pizza for us is four toppings and after that it’s $1 per topping so it’s obviously incrementally more profitable,” he says. “The average ticket in a digital space is 20 to 25 per cent higher than over the phone so that in itself is one of the best business case studies.”
With an average iPhone user spending eight minutes on the app per order (including time spent accessing the tracker), the exposure to the brand is unprecedented, compared with traditional exposure through advertising and the like.
For the future, Meij explains a dietary counter which will tally the calories, fat, sodium and carbs in your pizza as you build it online, and hints at a possible move into content-driven features.
“The number one thing a consumer does when they order a pizza is they go and watch content. Today it’s shrinking on television but it’s increased in online and as we know that’s going to grow to mobile so more and more consumers are going to watch content on their mobile device as 4G rolls out and HTML5 enables smarter use of media,” he says.
Nutrition for your business
Since 2009, Meij says the business has learnt how to amass a successful digital presence. The first lesson?
“Don’t be afraid to be first to market with technology,” he says. “Mobile consumers are going on[line] faster than companies so if you’re there first and early, you really do get to make sure you own your space.
“How many apps for how many categories will be kept on a phone? How many pizza apps are you going to keep?” he asks. “To be there first and to own it and make sure you give the customer everything that they want to do in the way they want to do it, it’s worth millions to our future.”
The second important consideration is functionality – in an app, you must ascertain what your consumer wants.
“We designed functionality to customers’ needs rather than novelties,” he says. “Very few [apps] are on an iPhone the next day … because of the fact it’s all novelty-bound and it’s all loaded up with just too much memory whereas our iPhone app was made sure it was completely functional.”
So, in a nutshell (or rather an iPhone case), what does your app offer that others don’t?
“The early adaptors and retailers that go online – most of them just put their catalogs and their menus up and in all honesty, what’s the advantage to the consumer if you’re simply looking at a catalog?”
Importantly, across all the mediums whether it’s browser-based, mobile-based or a physical store, consistency to the brand is key.
“Everything that we do, it’s got to be familiar so you don’t get a schizophrenic approach from Domino's,” says Meij. “For your PC or laptop, from your iPhone to now the new mobile, they’re all familiar although they do take advantage of the device that you’re using.”
Finally, take advantage of the technology platform you’re using. For Domino's, an iPhone app was the logical choice to get maximum exposure to their target audience.
“The number one time to use a smartphone app is when you leave your desk so we’ve seen the traffic driven on smartphones happens at lunch and happens at dinner and in fact smartphone surfing peaks at 11pm at night. Great thing is it’s all in pizza territory,” he says.
For businesses new to the digital space, Meij says CEOs and owners should embrace mobile as a great opportunity to stand out in the space.
“I still find it amazing when I see CEO groups when most CEOs say ‘Really? People are really going to do their business on a screen that big?’ and I can absolutely assure you that as a specimen in our own results already that it is and, in fact, nearly all of our net growth is on mobile,” he says.
Published on: Thursday, June 09, 2011