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The competition on fast food industry and making a competitive advantage on such competitors makes this study find out what strategic marketing are in place for Domino Pizza it is intended for senior managers which would highlight the following tasks.First task is to identify any current issue that impacts the organization.Second task is a detailed analysis using SWOT on the organisation's current strategic marketing on both external and internal issue explaining the organisations approach and the position of the organization in the marketplace.Third task is to discuss the decisions and choices at corporate level arising from the strategic marketing undertaken and how it affects the marketing in the different levels. Lastly are recommendations on the marketing strategies that would contribute to the competitive advantage of the organization.
Task 1 Principles of Strategic Marketing
Nowadays businesses survive through customer satisfaction, this then leads to innovations and changes on how the products or services must be presented in the eyes of the customer. Choosing the right outcome to satisfy this need is one of the strategies out in marketing. Marketing is an approach to satisfy,identify,anticipate the customer need and increase profitability in the business. This marketing ideas give a great impact when put into practice and helps the business better in putting strategies in place and to find this out a research on the market must be done and to do the study the prospect clients must be categorized as to their needs. How about corporate strategy? This involves the company striving to make more money and retain its customers even attracting new customers by making the business have better quality and higher value. In achieving this, is using strategic marketing through research about the behavior of consumers ,in identifying the customers needs and to make an impact that the products and services delivered are better than their competitors. According to Roslyn Frenz, corporate strategy and marketing strategy are linked together in the value chain , the practice of creating and marketing what people want. First-link is "market sensing" by identifying who would buy the product (the target market),next is "new offering"the product is researched,developed and created,"customer acquisition" comes next which includes advertising and campaigning,"customer relationship management"follows by making clients happy and be committed to the product and finally "fulfillment management covering all shipping,payments and logistics.
Marketing strategies also provide a competitive advantage for it serves as a guide to their busiess plans for further growth and profitability,because it is very critical in the business and is a disciplined function, the need of a chief marketing officer (CMO) must be in place. It is very important to understand the skills,experiences,qualifications and be able to be competent enough to face the challenges that lies ahead cause having this position within the business sector is very dynamic, usually misunderstood and highly influential and is in a short term contract due to the vital cost incurred and the dispruption of the turnover made.Thus, the strategic marketers make the business plans from the core people who are the customers or consumers, they assess the customers needs, the competitive environment and the companies own competencies.They are the champions of the company's brand value and play a pivotal role in leveraging this to the highest advantage. This possess both functional expertise as well as a broad and disciplined business perspective. Fundamentally,they help discover new channels, products and services that fuel growth and differentiate their company in the marketplace as described by Michael Frost(2009).
Let me site another author who discussed four important lead a marketing strategy can do in the organization by Michael Alpert. First is the market target,which is targeting who are the customers, to do this a marketing expert must be topped who can best lead the company to segment the right customer and drive them towards the business such as in Dominos Pizza a well established food chain pizza supplier targets every age bracket and offers services through deliveries . Second, is the competitive analysis, understanding who are the competitors who offer the same services and products and not in terms of price competition but to be different on own strategy on winning the customers.Third, is the market segment, how the business understand the customer and the competitive design in place which help identify the right kind of target such as high quality as exemplified by Marks&Spencer company or high volume productions and a lower product pricing as seen in Primark companies which also gives the company the right focus and in Domino Pizza is its appealing,tasteful,high quality and hot-oven pizza right up to the door delivery.Lastly,is to advertise or campaign which sets a right strategy by focusing on customers satisfaction, such may involve different selling techniques inorder to attract awareness and involve the commitment of customers to the brand even affects the forecasting of new customers to be gained.
For most of these internal factors as discussed above the external factors must be considered too which are the effects or influences that happens outside the business . Business effects the local community referred as the social benefits ,a business action that benefits the community such as jobs,in the government it encourage social benefits through using subsidies and grants example are the regional assistance for underdeveloped areas . Second is the social costs, where the business action causes costs, in terms being discouraged by the government due to taxes and legislations or fines such example is pollution.
The main external factors affecting business competition are the following. First is the degree of competition,on how severely businesss compete to each other in terms of products. Second is the social status or structure of society examples are both parents work,a single parent trying to survive,families,household,on how the community behave and their beliefs such as changes in attitude towards health or toward the product.Third , is legal where legislation impacts the business instance are the changes in employment laws and on working hours.Fourth is on how the economy affects the business on taxation,interest rates,general demand and government spending.Fifth is the political policy affecting the business such as on benefit laws and lastly the technological,rapid pace of changes or product innovation which affects the business.
This study would further look into Domino Pizza , a world leading pizza delivery about its market strategy and the great legal issue is on how it sustain itself on the competitive edge. Founded by two brothers Thomas and James Monaghan in Ypsilanti Michigan in 1960. First,franchise store opened in 1967 and international store in 1983. Celebrated its 50th anniversary on December 9, 2010. The Domino's Pizza UK and Ireland Limited is an owned subsidiary of Domino's Pizza Group(DPG). The first Uk store opened in 1985 and the Irish store in 1991.Germany and Switzerland (September,2012) . The main mission of Domino Pizza is to be the best pizza delivery company in the world through its team members and to have exceptional franchisees. The culture is summed up in their chant"Sell more pizza and have more fun". Their top priorities are to recruit,recognize and retain the best people, deliver consistently high quality food on time,take great care of the customers,innovate ways that matter to the team members and customers,ensure high image standards at the stores,treat others how they like to be treated and to take time to enjoy themselves.Dominoes Pizza has it's environmental policy too by monitoring and reducing its carbon emissions through the internal environment group whose main work is to investigate and innovate ways on reducing carbon emissions and to implement it as soon as possible.
Task 2 The External and Internal Analysis of the Organisation
To undertake the detailed analysis of the strategic marketing of Domino Pizza is to take a look on its SWOT analysis as taken from the report by Simba (June 2012). According to him what will be tackled under threats and oppurtunities (T&O) will make up the environmental issues,alongside are its strength and weakness (S&W) which is the internal and greater opportunity would be explored if the company is capable to assess the reality of what is happening within the business.
1. The number one pizza Delivery Company in the world.
2. Its franchisees is global .
3. It has a strong brand and well supported by its efficient and effective advertising and campaigns.
4. Well established supply chain & distribution network
5. Takes advantage of the fast trending technologies through the internet services
6. Effective home delivery option
7. Prices are within the customers budget as compared to competitors
8. Launch of mobile applications available on various platform with the feature called "Pizza Tracker"
These strengths shows that Domino is a figurehead in pizza delivery services. It's strong brand image is well established were customers who are loyal helps the company purchase and love its products. It's band with its franchisees internationally is very organized although it's diversified cause it's a global business the increase in market share is good and sales is very profitable too.
1. Slow growing and declining same-store sales
2. Weakening bottom lines due to slow growth and decline in the sales.
3. Its ambiance is not up to its competitors
4. Menu not elaborated and modified as compared to other chains.
5. Outlets lack space
Due to the recession happening around a great decrease in its store purchases declined which affected their revenue, brand image and profit sales go low but at present Domino Pizza delivery is making ways to cope with it.
1. Favourable market expansion opportunities especially in Asian countries like India and China
2. Introduction of new flavour additives and pizza toppings that are region specific
3. Leverage supply chain & distribution system to introduce new products
The advantage of Domino Pizza against its competitors is their focus on delivering pizza the most efficient and effective way with minimised spending such as the minimal cost needed to open and operate stores. Taking advantage of the growing population in Asian countries is very significant for it increases their market presence and revenues. The use of the technology applications in the business such as iphone applications,mobile or online services and with their consistent planning for improvement helps it grow, gain and lead among its competitors.
1. Changing consumer habits towards healthier food choices
2. Franchise operations affected by currency exchange fluctuations
3. Intensive competition from a fragmented number of small competitors.
Currently the competition for pizza deliveries is a great threat even with the evolvement of other fast food industries. Most of these competitors are Pizza Hut, Papa John's and Mc Donalds. In others the growing awareness on health consciousness which affects their sales posts a threat too. Lastly, the increase in labor and food prices which increases their operation costs has a great impact too.
These SWOT analysis done helps to delve deeper into future programs and strategies the company has to undertake to stay as the most top most leading pizza delivery and stay at its most competitive advantage in the market and implores on the management that keeping in pace with advance technology is towards their advantage as discussed on marketing strategies in place for further progress and improvement.
Task 3 Strategic Marketing Decisions and Choices
Domino Pizza is focused on their core strength on delivering quality pizza with complementary items in a timely manner. The delivery -oriented store is designed with low capital requirement, focused menu on pizza with complimentary items, the committed owner-operator franchisees and the vertically integrated supply chain system. The company operates in three segments,domestic stores,domestic supply chain and international. The domestic stores are comprised of 4,513 franchised stores and 394 company owned-stores.The domestic supply chain manufactures the dough and thin crust products, processes vegetables and distributes food,equipment and supplies to the company owned-stores and domestic franchise stores.The international is comprised of about 4,835 franchise stores. It went international since 1983 in Canada, went overseas in 1994 (Warsaw and Poland), operated in About 60 countries, Greece, Morocco, Scotland, Puerto Rico and Malaysia until it reached about 8,600 stores in 2003 globally. Expanding in India in 2007, 2008 in Netherlands and Australia,Belgium and France because of its online ordering which proved to be a great success in Domino Pizza delivery service where an increase in revenue and sales happened but such fall down in store franchisees came along since 2007. It was very important to consider the different taste preferences and ingredients used in making pizza even the culture of the place which had been a challenge , the higher costs of goods, labour and business which affects their pricing in every country and Domino had done a great job dealing with it. Domino Pizza combines new-digital marketing strategies and social media to help maintain the sales momentum it has enjoyed over the past years. It has also launched in 2009 "the new inspired pizza". Marketing investor Weiner put to effect the mobile-optimized website for online ordering,pizza tracker,smart phone and tablet application for ordering and the Pizza Hero game for ipad application. It has spread into facebook and twitter fan by setting up the "Pizza turnaround"advertising campaign using Times Square Tracker by sharing all tweets from customers positive nor negative. Thus the Times Square Tracker developed a million mystery shoppers even motivated employees to work better, reduced service times and increased customer satisfaction by keeping its prices consistent, and focusing on the brand and its products maintained its customers and attracted new buyers.Domino still expands out with franchisees created mainly for carry-out and delivery which doesn't require more operating expenses or capital such as setting up a restaurant. Domino encourages the owners of its stores to use a standard operating model which supports specific eating preferences and habits of the international locations thus making the image stronger in band and makes it the number one pizza delivery in the world.
Domino Pizza marketing strategies for further growth and strengthen their competitive advantage first,includes the continued execution of the mission statement by having the concept of one united brand, system and team.Second, to grow their leading position in the competitive industry by having convenient store locations, having simple operating model, their highly recognised image with affordable menu offerings and their efficient supply chain system.Third is to leverage their strong brand awareness by enhancing their reputation as leading pizza delivery, launching improved pizza recipes,consumer-tested and profitable product varieties such as oven baked sandwiches, artisan pizzas,bread bowl pasta with complimentary side items such as boneless chicken and wings,new stuffed cheesy bread,chocolate lava crunch cakes,etc even on campaigning or advertising on social networking internet sites and other media and with partnership to other organization such as Coca-Cola. Lastly is to expand in its global store base as evidenced with 4,835 international stores by achieving a favorable store-level economic, strong global recognition and positive store sales growth as in 2011 there are 413 net international store openings, 75 net stores in India,54 net stores in UK and 58 net stores in Turkey
Task 4 An Analysis To the Range of Marketing Strategies For Competitive Advantage
At the moment the Master Franchise which is Domino UK and Ireland now owns 130 franchisees,its long-term strategy is the target of rolling out of one new Domino store per week in the next ten years, making the business grow into a billion pound brand in UK. It impressed stock market investors rapidly in the like-for-like("LFL) growth in sales which itself is a measure of growth in revenues underlying factors are penetration in UK households, the frequency in which a customer re-orders, the average value on the receipt ticket from each order. Domino also trades at £5.20 per share. The sheer scale of Dominos operation is a vital part for its competitive advantage about 3.4 million homes pizza deliveries in 2009, network store services of 35 to 40 percent in Uk population.their aim within five years is a growth to over 1000 stores which drives them to £1billion mark for turnover making an excess of £100 million profit annually.There are four and a half percent of the turnover of each Domino Franchise store goes into the fund used for national marketing which is used to develop high profile communications such as sponsoring X-Factor , The Simpsons or Britain Got Talent shows. Domino also entered social media through advertising and campaigning in Facebook, Tweeter and other social networks even Pizza Tracker in Iphone application which delivers 3-4% of online sales.
Price Discrimination made the business successful such as the two for Tuesday and Saturday promotion, price discounting on mid week which generated extra revenue and growth in volumes. Targeting of core group of consumers by setting up a sponsored pizza societies in universities, such business is being aware of business demographics in terms of age group that would purchase more of their products.
The use of complex data driven IT systems used by Dominos to its franchisees around the world which is the on-line ordering and on global point of sales. It even built-up a valuable database of location of specific customers used in promoting new products,reinforcing brand awareness wherein the cost of selling to an existing customer is always lower. Undoubtedly Domino has gone so far and still on the move to innovate and make improvement on presenting quality services towards its competitive advantage .
In United States (1960) Dominos Pizza Inc. makes use of Management Information Systems (MIS), its primary task is to help organization be efficient and effective. It is a computer based system in organizing, analyzing and executing plans in organisation flow and it is used to study information on employees, cost, profit and technology even procedures and documents ,mostly studies the operational tasks in the establishment, promotes short term and long term goals providing faster decision making of managers. Domino Pizza corporate level sees to it that the creator of MIS must always be relevant, relievable,accurate,complete and consistent in order to be of competitive advantage.
CONCLUSION AND RECOMMENDATION
According to the research done by Hamid Hussain(Nov.2010).The supply chain integration of domino pizza is the second largest pizza delivery in US about 8500 corporate with franchisees in fifty five countries. India opened in 1996 with 274 outlets and about 70% revenues are collected from home deliveries and 30% is on the over-the-counter sales and ranked as the number one leading pizza delivery in the world. The Corporate strategy of Domino pizza is exceptional people on the mission as the best pizza delivery company in the world, to think global and act local through fun, happiness and convenience. Domino Pizza operates in three ways as domestic stores, domestic supply chain and international. The Domestic stores uses its owned stores as the testing ground for new products and technologies then passed unto the franchisees which generates more profit. The domestic supply chain is vertically integrated automatic system where delivery of raw materials cuts out a lot on back of store" activities,even helps in keeping down food costs. The procurement of raw materials like baby corn,wheat,tomatoes and spices are from local source and dough and other food supplies are manufactured and distributed from US chain centers worldwide to its franchisees. Lastly is on international which consists of 3469 franchisees outside the United States. These accounts about 41% of the sales of Dominos worldwide.
The above marketing strategies in place by Domino Pizza company had been very significant as to their competitive edge. As experienced in the field of business it is exceptionally performing well and this account to the efficient and effective management in place a further recommendation is only on the part of employee as seen in one of the issues on the employee who tainted on dominos brand but was immediately acted upon by the management that further enhancement and review on employee motivation, behaviour and performance must be given preference in a quarterly basis in every outlet to ensure that every staff works to the best of the company and further add up to their gain on customer satisfaction.