Convenience Puts Domino’s at Head of Pizza Pack

Chain’s mobile app and online ordering help to boost tab size and repeat orders.

October 17, 2014

WASHINGTON – Domino’s Pizza and Pizza Hut are the titans of the $38 billion U.S. pizza market, yet at this moment, one chain is piping hot and the other is in need of reheating, says the Washington Post in an article this week.

Domino’s third quarter results showed that U.S. same-store sales grew 7.7% this year and profits jumped 8%. According to Domino’s, the chain also attracted more customers and saw the average size of their tabs increase. So, what’s the secret that’s boosting them above chains like Pizza Hut, which reported a 2% decrease in sales? According to the news report, the differentiator is likely Domino’s embrace of the convenience factor, particular with its highly successful mobile app.

According to Domino’s, almost half (45%) of its U.S. sales now come from customers ordering online. On top of that, online orders tend to have higher tabs than orders placed via phone. The Washington Post also cites an investor call this week stating that digital ordering capabilities are also leading to a higher volume of orders from repeat customers.

The latest addition to the Domino’s mobile portfolio, the app’s new voice-ordering capability, received 200,000 orders before the company even began advertising the feature.

The Washington Post goes on to add that while the shift to digital pizza ordering is putting pressure on the major national brands to innovate, it could be creating problems for mom-and-pop shops and regional chains.  These smaller operations likely don’t have the dollars to invest in such technology, meaning they might face fresh challenges in attracting convenience-focused customers.

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