Domino's Pizza

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Domino's Pizza
TypePublic
Traded asNYSEDPZ
IndustryRestaurants
FoundedYpsilanti, Michigan on June 10, 1960
HeadquartersDomino Farms Office Park
Ann Arbor Charter Township, Michigan, United States
Area servedWorldwide
Key peopleTom Monaghan, Founder
J. Patrick Doyle, CEO
ProductsPizza, pasta, chicken wings, submarine sandwiches, wraps, desserts
RevenueIncrease $1.802 billion USD (2013)[1]
Employees220,000 (Dec 2013)[1]
Websitewww.dominos.com
 
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Domino's Pizza
TypePublic
Traded asNYSEDPZ
IndustryRestaurants
FoundedYpsilanti, Michigan on June 10, 1960
HeadquartersDomino Farms Office Park
Ann Arbor Charter Township, Michigan, United States
Area servedWorldwide
Key peopleTom Monaghan, Founder
J. Patrick Doyle, CEO
ProductsPizza, pasta, chicken wings, submarine sandwiches, wraps, desserts
RevenueIncrease $1.802 billion USD (2013)[1]
Employees220,000 (Dec 2013)[1]
Websitewww.dominos.com

Domino's Pizza is an American restaurant chain and international franchise pizza delivery corporation headquartered at the Domino Farms Office Park (the campus being owned by Domino's Pizza co-founder Tom Monaghan) in Ann Arbor Charter Township, Michigan, United States, near Ann Arbor, Michigan.[2][3] Founded in 1960, Domino's is the second-largest pizza chain in the United States (after Pizza Hut)[4] and the largest worldwide, with more than 10,000 corporate and franchised stores[5] in 70 countries.[6] Domino's Pizza was sold to Bain Capital in 1998 and went public in 2004.

Early years[edit]

In 1960, Tom Monaghan and his brother, James, purchased DomiNick's, a small pizza store in Ypsilanti, Michigan, near Eastern Michigan University.[7] The deal was secured by a $75 down payment and the brothers borrowed $900 to pay for the store.[8] Eight months later, James traded his half of the business to Tom for a used Volkswagen Beetle.[8] In 1965, Monaghan renamed the business Domino's Pizza, Inc. In 1967, the first Domino's Pizza franchise store opened in Ypsilanti.[8] The company logo was originally planned to add a new dot with the addition of every new store, but this idea quickly faded, as Domino's experienced rapid growth. The three dots represent the stores that were open in 1969.[9] Reflecting Domino's growth, the company had expanded to 200 stores by 1978.[10][11] In 1975, Domino's faced a lawsuit by Amstar Corporation, the maker of Domino Sugar, alleging trademark infringement and unfair competition. On May 2, 1980, the Fifth Circuit Court of Appeals in New Orleans found in favor of Domino's Pizza.[12]

International expansion[edit]

Domino's outlet in Himayatnagar, Hyderabad, Andhra Pradesh, India.

On May 12, 1983, Domino's opened its first international store, in Winnipeg, Manitoba, Canada.[13] That same year, Domino's opened its 1,000th store overall. In 1985, they opened their first store in the United Kingdom in Luton.[14] Also in 1985, Domino's opened their first store in Tokyo, Japan. By 1995, Domino's had expanded to 1,000 international locations. In 1997, Domino's opened its 1,500th international location, opening seven stores in one day across five continents.[10] From 2007 to 2012, Domino's gradually established a presence in India with at least 1,000 locations by 2012.[15]

Sale of company[edit]

In 1998, after 38 years of ownership, Domino's Pizza founder Tom Monaghan announced his retirement, sold 93 percent of the company to Bain Capital, Inc. for about $1 billion, and ceased being involved in day-to-day operations of the company.[16] A year later, the company named David A. Brandon CEO.[17]

Current era[edit]

Domino's Pizza logo used from 1996 until 2012 in the U.S. and the UK, and to present day in the other countries
The exterior of a Domino's Pizza store in Spring Hill, Florida.
A Volkswagen Jetta Domino's Pizza delivery car

In 2004, after 44 years as a privately held company, Domino's began trading common stock on the New York Stock Exchange under the ticker symbol "DPZ".[18] Industry trade publication Pizza Today magazine named Domino's Pizza "Chain of the Year" in 2003, 2010, and 2011.[19][20][21] In a simultaneous celebration in January 2006, Domino's opened its 5,000th U.S. store in Huntley, Illinois, and its 3,000th international store in Panama City, Panama making 8,000 total stores for the system.[22] In August 2006, the Domino's location in Tallaght, Dublin, Ireland, became the first store in Domino's history to hit a turnover of $3 million (€2.35 million) per year.[23] As of September 2006, Domino's has 8,238 stores worldwide, which totaled $1.4 billion in gross income.[24]

In 2007, Domino's introduced its Veterans Delivering the Dream franchising program and also rolled out its online and mobile ordering sites.[11] In 2008, Domino's introduced the Pizza Tracker, an online application that allows customers to view the status of their order in a simulated "real time" progress bar.[25] The first Domino's with a dining room opened in Stephenville, Texas, giving the customers the option to either eat in or take their pizza home. Since 2005, the voice of Domino's Pizza's US phone ordering service 1-800-DOMINOS has been Kevin Railsback.[26]

In a 2009 survey of consumer taste preferences among national chains by Brand Keys, Domino's was last — tied with Chuck E. Cheese's. In December that year, Domino's announced plans to entirely reinvent its pizza. It began a self-criticizing ad campaign in which consumers were filmed criticizing the then-current pizza's quality and chefs were shown developing a new pizza.[27][28] The new pizza was unveiled that same month. The following year, 2010 and Domino's 50th anniversary, the company hired J. Patrick Doyle as its new CEO and experienced a historic 14.3% quarterly gain. While admitted not to endure, the success was described by Doyle as one of the largest quarterly same-store sales jumps ever recorded by a major fast-food chain.[29][30]

In 2012, Domino's Pizza removed the word "Pizza" from their logo, to emphasize their non-pizza products. At the same time, Domino's introduced a new logo that removed the blue rectangle and text under the domino in the logo, and changed the formerly all-red domino to be blue on the side with two dots and red on the side with one dot.[31]

Menu[edit]

Domino's Pizza (Malaysia), Chicken Pepperoni, New York Crust.
A makeline at a Domino's

The current Domino's menu features a variety of Italian-American entrees and side dishes. Pizza is the primary focus, with traditional, specialty, and custom pizzas available in a variety of crust styles and toppings. In 2011, Domino's launched artisan-style pizzas. Additional entrees include pasta, bread bowls, and oven-baked sandwiches. The menu offers chicken side dishes, breadsticks, as well as beverages and desserts.[32]

From its founding until the early 1990s, the menu at Domino's Pizza was kept simple relative to other fast food restaurants, to ensure efficiency of delivery.[33] Historically, Domino's menu consisted solely of one pizza in two sizes (12-inch and 16-inch), 11 toppings, and Coca-Cola as the only soft drink option.[34]

The first menu expansion occurred in 1989, with the debut of Domino's deep dish or pan pizza. Its introduction followed market research showing that 40% of pizza customers preferred thick crusts. The new product launch cost approximately $25 million, of which $15 million was spent on new sheet metal pans with perforated bottoms.[35] Domino's started testing extra-large size pizzas in early 1993, starting with the 30-slice, yard-long "The Dominator".[36]

Domino's tapped into a market trend toward bite-size foods with spicy Buffalo Chicken Kickers, as an alternative to Buffalo Wings, in August 2002. The breaded, baked, white-meat fillets, similar to chicken fingers, are packaged in a custom-designed box with two types of sauce to "heat up" and "cool down" the chicken.[37][38]

In August 2003, Domino's announced its first new pizza since January 2000, the Philly Cheese Steak Pizza. The product launch also marked the beginning of a partnership with the National Cattlemen's Beef Association, whose beef Check-Off logo appeared in related advertising.[39] Domino's continued its move toward specialty pizzas in 2006, with the introduction of its Brooklyn Style Pizza, featuring a thinner crust, cornmeal baked in to add crispness, and larger slices that could be folded in the style of traditional New York-style pizza.[40]

In 2008, Domino's once again branched out into non-pizza fare, offering oven-baked sandwiches in four styles, intended to compete with Subway's toasted submarine sandwiches. Early marketing for the sandwiches made varied references to its competition, such as offering free sandwiches to customers named "Jared," a reference to Subway's spokesman of the same name.[41]

The company introduced its American Legends line of specialty pizzas in 2009, featuring 40% more cheese than the company's regular pizzas, along with a greater variety of toppings.[42] That same year, Domino's began selling its BreadBowl Pasta entree, a lightly seasoned bread bowl baked with pasta inside, and the Lava Crunch Cake dessert, composed of a crunchy chocolate shell filled with warm fudge.[43] Domino's promoted the dessert by flying in 1,000 cakes to deliver at Hoffstadt Bluffs Visitor Center near Mount St Helens in Washington State.[44]

In 2010, shortly after the company's 50th anniversary, Domino's changed its pizza recipe "from the crust up", making significant changes in the dough, sauce, and cheese used in their pizzas.[45] Their advertising campaign admitted to earlier problems with the public perception of Domino's product due to taste issues.[46][47]

After a stock low point in late 2009, the company's stock had grown 233 percent by late 2011. Even as the American economy has suffered and unemployment has risen, Domino's has seen its sales rise dramatically through its efforts to rebrand and retool its pizza.[48]

Domino's serves Coca-Cola products and is the only "Big Four" pizza chain to do so. Rivals Papa John's Pizza and Little Caesars sold Coca-Cola in the past (Pizza Hut, due to its previous ownership by PepsiCo, has a lifetime contract to sell Pepsi products), but both switched to Pepsi in 2012 and 2007, respectively. Domino's Pizza in Mexico switched to Pepsi in November 2012 and Domino's Pizza in Pakistan is with Pepsi as well.

In September 2012, Domino's announced it was going to roll out a pan pizza on September 24, 2012.[49] Following this move, the Deep Dish pizza was discontinued after 23 years of being on the menu.

In December 2013, Domino's Pizza, in Israel, unveiled its first vegan pizza, which uses a soy-based cheese substitute.[50][51]

Corporate governance[edit]

Domino's Pizza corporate headquarters within the Domino's Farms Office Park.

Domino's management is led by J. Patrick Doyle, CEO from March 2010, formerly president of Domino's USA. Previous chief executive David Brandon, made the athletic director of the University of Michigan in January 2010, remains chairman.[52] Among 11 executive vice presidents are Michael Lawton, CFO; Steve Akinboro, Team USA; Scott Hinshaw, Franchise Operations and Development; and Kenneth Rollin, General Counsel.[53] Domino's operations are overseen by a board of directors led by Brandon. Other members of the board are Andrew Balson, Diana Cantor, Mark Nunnelly, Robert Rosenberg and Bud Hamilton.[54]

Charitable activities[edit]

In 2001, Domino's launched a two-year national partnership with the Make-A-Wish Foundation of America. That same year, company stores in New York City and Washington D.C. provided more than 12,000 pizzas to relief workers following the September 11 attacks on the World Trade Center and The Pentagon. Through a matching funds program, the corporation donated $350,000 to the American Red Cross' disaster relief effort.[10] In 2004, Domino's began a partnership with St. Jude Children's Research Hospital, participating in the hospital's "Thanks and Giving" campaign since the campaign began in 2004, and raising more than $1.3 million in 2006.[55]

Advertising and sponsorship[edit]

In the 1980s, Domino's Pizza was well known for its advertisements featuring the Noid. That concept was created by Group 243 Inc. who then hired Will Vinton Studios to produce the television commercials that they created. The catchphrase associated with the commercials was "Avoid the Noid."

Due to a glitch on the Domino's website, the company gave away nearly 11,000 free medium pizzas in March 2009. The company had planned the campaign for December 2008 but dropped the idea and never promoted it. The code was never deactivated though and resulted in the free giveaway of the pizzas across the United States after someone discovered the promotion on the website by typing in the word "bailout" as the promotion code and then shared it with others on the Internet. Domino's deactivated the code on the morning of March 31, 2009 and promised to reimburse store owners for the pizzas.[56]

Domino's sponsored CART's Doug Shierson Racing, which was driven by Arie Luyendyk and won the 1990 Indianapolis 500. In 2003, Domino's teamed up with NASCAR for a multi-year partnership to become the "Official Pizza of NASCAR."[57] Domino's also sponsored Michael Waltrip Racing and driver David Reutimann during the 2007 season in the NASCAR Sprint Cup Series.

30-minute guarantee[edit]

Starting in 1973, Domino's Pizza had a guarantee that customers would receive their pizzas within 30 minutes of placing an order or they would receive the pizzas free. The guarantee was reduced to $3 off in the mid 1980s. In 1992, the company settled a lawsuit brought by the family of an Indiana woman who had been killed by a Domino's delivery driver, paying the family $2.8 million. In another 1993 lawsuit, brought by a woman who was injured when a Domino's delivery driver ran a red light and collided with her vehicle, the woman was awarded nearly $80 million, but accepted a payout of $15 million.[58] The guarantee was dropped that same year because of the "public perception of reckless driving and irresponsibility", according to then-CEO Tom Monaghan.[58]

In December 2007, Domino's introduced a new slogan, "You Got 30 Minutes", alluding to the earlier pledge but stopping short of promising delivery in a half hour.[59]

The company continues to offer the 30 minute guarantee for orders placed in its stores situated in Colombia, India, Vietnam, and Turkey.

In Malaysia and Singapore, a refund is instead substituted with a "Free Regular Pizza Voucher".[60][61]

In India, the guarantee is for ₹300 ($5) and is valid for an order of less than 4 pizzas.

International operations[edit]

Map showing Domino's Pizza's global locations.

Domino's Pizza currently has locations in 73 countries. It has its stores in 5,700 cities worldwide (2,900 international and 2,800 in the US). Domino's has 10,566 stores as of the third quarter of 2013, with 750 in the UK, 4,900 in the US, and 650 in India.[62][63][64] In most cases, Domino's has master franchise agreements with one company per country, but three companies have acquired multiple master franchise agreements, covering a number of countries:

References[edit]

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External links[edit]