Domino’s Digital Loyalty Program Tops 25 Million Members
The world's largest pizza chain has mastered what a loyalty program can do to grow sales and beat competition in the industry.
Need to Know
- Domino’s Pizza hit 25 million active loyalty members in 2019, with 40+ million enrolled overall, and 85+ million in its total customer database.
- In the “delivery aggregator battle” between partners like GrubHub, Postmates, and UberEats, Domino’s is coming out on top with an active loyalty program that rewards users with a free pizza every 6 purchases.
- Domino’s total revenue exceeded projections of $1.13 billion, arriving at $1.15 billion, and global retail sales grew 6.9%.
Analysis
Domino’s Pizza hit 25 million active loyalty members in 2019 for it’s “Piece of the Pie” rewards program, which means more than 25% of all the 85+ million customers in its database are active users.
The pizza chain is the largest in the world and pulls in $14 billion in revenue from nearly 17,000 global locations. Domino’s also opened more than 1,100 new stores in 2019, introduced faster and GPS-tracking enhanced delivery, a “Pie Pass” quick-pickup program, and exceeded analyst’s revenue expectations.
This is what happens when the delivery partner battle wages: some companies step up and innovate, and others “stand in the circular firing squad”, as Domino’s CEO Ritch Allison noted.
Domino’s digital innovations have clearly not gone unnoticed: 75% of sales are through online channels, which bolsters deals like the half-off deal during Cyber Monday week.
By funneling customers more to its loyalty program and quick-pickup and carry-out offers, Domino’s is looking to bypass the delivery aggregator fees that can eat up a huge percentage (around 20-40%) of revenue. But Domino’s is also hoping to personalize the digital ordering experience in a way that aggregators can’t compete with: customers are greeted at the counter by name and rewarded for their loyalty.
Dennis Maloney, Domino’s CIO says, “It’s the ultimate VIP carryout experience where customers don’t have to be a regular customer to be treated like one.”
As for the future, leadership is keeping a very careful eye on the delivery battle, though they appear to be confident in the company’s growth strategy. “[The delivery aggregators] are going to continue to keep advertising, going to continue to keep discounting, because I don’t think they have any choice. And so we expect, while we’re not in the middle of the firing squad, we might get hit by a few straight bullets along the way,” says Allison.
