Transcript pptx - Marketing EDGE

Domino’s Pizza
Mobile App
“From Your Phone To Your Door”
5/16/14
Alisha Frederick
Amy Hashem
Scott Levine
Xinyuan Wu
Strategic Summary
Strategic findings from research
Data Source
Application to Strategy
1
25-34 year olds 74% more likely to own a
smartphone; 98% download apps
Simmons, ComScore,
Qualtrics Research
Core Target Audience
2
Receive a free item with purchase via the mobile
app ranked high among segments
IdeaMap® Research
Results
Offer one free dessert with 1st order through the mobile app
3
High affinity gaming apps
IdeaMap® Research
Results
Mobile banner ads placed within game apps for click to
download the app
4
Preference to learn about update s, new products,
etc. via social media
IdeaMap® Research
Results
Instagram and Facebook promotions to inform the customer
and encourage interaction
5
All segments indicated motivation to earn points
towards rewards through app download and
usage
IdeaMap® Research
Results
Offer 10th order via the mobile app free (up to $30)
and
Offer a $25 Visa gift card with 1,000 points earned from
ordering via mobile app
6
The average customer buys pizza 21 times a year
and Domino’s makes up 6 to 7 of those occasions
Loyalty360 Article
Estimate respondents will purchase 7 orders from Domino’s
within the campaign year
7
Synchronized integrated and interactive strategy
for higher response rate
Ernan Roman
Integrated and
Interactive Marketing
Strategy
Basis of core strategy (See Media Plan)
Agenda
• Market Research
• Target Market Segmentation
• Market Strategy
• Media Plan
• Creative Strategy
• ROI
Market Research (Secondary)
Snapshot of The Industry – Where does
Domino’s Pizza currently stand?
Domino’s currently accounts for
roughly 9% of the US Pizza market
and is projected to continue growth.
Market Research (Secondary)
Who is a potential mobile app consumer?
Looked for a Mobile App specific target market within
the Domino’s current customer target market of 18-49
year olds, slightly female who make purchase
decisions for buying meals. Must take into
consideration that customer owns a smartphone.
The largest group of smartphone users are
25-34, slightly female, suburban and
married. Fits perfectly within Domino’s
target market.
Market Research (Secondary)
“Digital's impact on branding, loyalty”
• "It's doing a lot for the brand image because you can track the
persistency of customers that switch from calling on the phone to an
iPhone app. They keep telling us, 'This is what we want,' and we're
going to keep doing everything we can to be a leader in technology.“
• Lawton said the average customer buys pizza 21 times a year, and
Domino's makes up six to seven of those occasions. Even the
company's most loyal customers don't choose Domino's every single
time.
• "That's why we are so focused on the digital, because we think it's one
of the fronts that will enhance our loyalty.“
http://loyalty360.org/resources/article/cfo-dominos-digital-channels-enhancebrand-loyalty#sthash.ScJFZjQi.dpuf
Market Research (Primary)
Qualtrics
Survey – 113 respondents – 15 questions
Majority of respondents within the age of 25-34 year olds
51 male respondents, 53 female respondents
Collected results throughout the U.S. - No geography bias
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98% currently own a smartphone or tablet
98% currently download apps
51% admit they have downloaded apps to order food
Top 3 apps they mentioned they used to order food - Seamless, Yelp and Domino’s
Most spent $15-$20 on a delivery meal
46 people ordered from Domino’s within the last year
A majority of the respondents who do order Domino’s said they ordered 1-5 times
through the year
Market Research (Primary)
IDEAMAP
51 Respondents from all over the US – 36 Marketing Elements – 31 Survey Questions
25 Males and 26 Females
63% White and 67% between the ages of 25 and 34
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76% are not students
75% single
92% own a smartphone
90% download apps
57% order out once a week on average
73% are more likely to order pizza when they order out
20% fall into the Mobile Savvy Social Connectors segment
49% are members of the Pizza Loving Young Families group
31% of respondents are categorized as Deal Seeker Influentials
Target Market Segmentation
• Mobile Savvy Social Connectors – Communication is central in the lives of Social Connectors. Their
cell phone allows them to keep up-to-date with friends and social events. The cell phone device is
the bridge to their social world.
• Pizza Loving Young Families – Suburban, married couples with children--Kids & Cul-de-Sacs--an
enviable lifestyle of large families in recently built subdivisions. With a high rate of Hispanic and Asian
Americans, this segment is a refuge for college-educated, white-collar professionals with
administrative jobs and upper-middle-class incomes.
• Deal Seeker Influentials – These shoppers are constantly looking for the best online, offline and
mobile deals. Deal-Seeker Influentials tend to be young, highly educated, socially active consumers
who love shopping but don’t expect to pay full price. They are very active on the Internet and social
media, especially when it comes to talking about their favorite products and brands. Interestingly,
they are also highly influential within their social circles and tend to be trendsetters.
Market Strategy
• Unique Selling Proposition – “You get fresh, hot pizza from your phone to your
door delivered in 30 minutes or less. It’s that simple.”
• Offering – Domino’s Pizza Mobile App
• Loyalty program – Rewarding multiple orders with point system
• Offers –
• Order via the mobile app and receive your 10th order free (up to $30 value)
• Receive a $25 Visa Gift Card with 1,000 points earned from ordering via the
mobile app
• Order via the mobile app and get one free dessert with your first order
Media Plan
TOTAL PROMOTIONAL BUDGET: $250,000
Media Mix:
• In-Store Display – 39.2%
• Direct Mail – 20%
• E-mail – 19.9%
• Banner Advertising – 18%
• Public Relations – 2%
• Pizza Box Toppers - 0.9%
Additional tactics:
• Social Media
• Website
In-Store Display
Direct Mail
E-mail
Banners
PR
Pizza Box Topper
MEDIA PLAN
Media
Jan
Public Relations Campaign
PR News Wire Services
PR 1
Email Test Campaign
House List
Email 1
Q1
Feb
Mar
Apr
Q2
May
Jun
Q3
Aug
Jul
Sept
Oct
Q4
Nov
Dec
Promo
Cost
$5,000.00
$0.00
Rented List
Mobile Savvy Social Connectors
Pizza Loving Young Families
Deal Seek Influentials
E-Mail 2
E-Mail 3
E-Mail 4
$3,825
$3,825
$3,825
$3,825
$4,500
$4,500
$4,500
$4,500
$4,050
$4,050
$4,050
$4,050
$49,500.00
$300.00
Hard Costs
Direct Mail Test Campaign
Mobile Savvy Social Connectors
Pizza Loving Young Families
Deal Seeker Influentials
DM 1
DM 2
DM 3
$1,913
$1,913
$1,913
$1,913
$2,250
$2,250
$2,250
$2,250
$2,025
$2,025
$2,025
$2,025
$24,750.00
$25,250.00
Hard Costs
Banner Advertising
Triggered on Weather.com & The
Weather Channel Mobile App
Digital 1
750,000 impressions
750,000 impressions
Re-Targeting Display Ad Netw ork Digital 2
7,500,000 impressions
Geo-targeted ad netw ork desktop
& mobile around 4900 locations
Digital 3
4,500,000 impressions
Domino's Website
$15,000.00
$15,000.00
$15,000.00
Digital 4
$0.00
Pinterest
Digital
Digital
Digital
Digital
$0.00
$0.00
$0.00
$0.00
Pizza Box Toppers
On-site Print
$2,200.00
On-site Print
$98,000.00
Social Media
Facebook
Tw itter
Instagram
5
6
7
8
In-Store Display
Window Decals - 4900 locations
Total Spend
$65,500.00
$60,000.00
$57,500.00
$68,000.00
$250,000.00
Creative Strategy
Leverage the already strong Domino’s brand name and current creative, but include new messaging to
highlight premiums and encourage usage of the mobile app multiple times.
Social Media
Creative Strategy
Direct Mailer
Creative Strategy
In-Store Window Display
Creative Strategy
Banner Advertising
Creative Strategy
E-Mail
ROI and Budget
Campaign Results
Year 1
Target Market
810,000
Response Rate
7%
# of Orders per respondent
7
Sales
396,900
Marketing Contribution
$1,103,429
Marketing Expense
$250,000
Return on Investment
441%
Premium Offer
Cost of Premium if all
Respondents Cash in
Lifetime Value of
Respondents before Cashing
in on Premium
ROI of
Premium Offer
10th Meal Free
$1,701,000
$9,667,350
568%
$25 Visa Gift Card with
1,000 points
$1,417,500
$56,700,000
4000%
Free Dessert with 1st order
$311,850
$966,735
310%
RETURN ON INVESTMENT
Selling Price
Cost per unit
Order per
respondent
List (# of prospects)
Gross Response Rate
# of contacts
Response Rate
Responses Sales
Net Order Sales
% cost of sales
Per order sales
dollars
Per order variable
costs
Per order variable
profit
Net Dollar Sales
Cost of Sales
Gross Profit
Combined Marketing
Costs
Marketing Expenses
Based on IdeaMap® weighted average per purchase
$17.05 <---------spend
Based on Domino's 2012 Financial Statement - Cost of Email Marketing Costs
$13.64 <---------Sales = 80%
Direct Mail Marketing
7 <---------- CFO Michael Lawton estimated a regular customer
costs
orders from Domino's 7 times per year in 2013
810,000 <---------- Sourced from Nextmark and restricted by budget
Banner Online
Advertisements
7% <---------- Double digit response rate achieved from the Ernan
Roman integrated interactive marketing strategy
810,000 <---------- Sourced from NextMark and restricted by budget
Gross response rate achieved from the Ernan Roman
7% <---------integrated interactive marketing strategy
56,700 <---------- Calculated
Calculated based on customer lifetime in 1 year - 7
396,900 <---------orders for every 56,000 respondents
Based on Domino's 2012 Financial Statement - Cost of
80% <---------Sales = 80%
Based on IdeaMap® weighted average per purchase
spend
Based on Domino's Pizza 2012 Financial Statement $13.64 <---------Cost of Sales = 80%
PR
$250,000.00 <----------
$49,800.00 <----------
$50,000.00 <----------
$45,000.00 <----------
$5,000.00 <----------
Social Media
$0.00 <----------
Website
$0.00 <----------
In-Store Display
Pizza Box Toppers
Total Marketing Cost
$98,000.00 <---------$2,200.00 <---------$250,000.00 <----------
Budget provided by Domino's Pizza
Includes cost of list acquistion of 540,000
(eCPM = $92) and creative fixed costs Nextmark
Includes cost of list acquisition of 270,000
(eCPM = $92), printing and mailing Nextmark and DirectMail.com
Banner online advertisements on
strategically selected websites and mobile
sites (9,200,000 impressions with eCPM of
$5.10 through ad network and premium
placements)
PR News Wire services - industry rates
Creating buzz and engagement on
Facebook, Instagram, Twitter and Pinterest
In-house redesign of website to include
Mobile App promotions on the homepage
Calculated from Signazon.com 12x18
Window decal signage in 4,900 Domino's
Pizza Retail Stores
Calculated from Mailshark.com - Test for
50,000 orders
Budget provided by Domino's Pizza
$17.05 <----------
$3.41 <----------
Calculated
$6,767,145.00 <---------- Calculated
$5,413,716.00 <---------- Calculated
$1,353,429.00 <---------- Calculated
Premiums
10th Meal Free
$1,701,000.00 <----------
$25 Visa Gift Card
Free Dessert with 1st
order
Total Premium cost
$1,417,500.00 <----------
Total Marketing
Contribution to Profit
Breakeven order sales
point of promotion
Promotional cost of each
order
ROI
$311,850.00 <----------
$30 times total respondents – Max
investment
$25 times total respondents – Max invest
$5.50 times total respondents – Max invest
$3,430,350.00 <----------
Calculated
$1,103,429.00 <----------
Calculated
73,314 <----------
Calculated
$0.63 <----------
Calculated
441% <----------
Calculated
Conclusion
• Through the use of multiple channels, the
“From Your Phone to Your Door” campaign
will generate a 7% response rate
• Enhanced user experience through the
mobile app will encourage customer loyalty
• The synchronized integrated campaign will
give Domino’s a 440% ROI from an initial
investment of $250,000 proving its success.
Thank You!