Investing in Domino's Pizza – It's All About the Dough (Part 11 of 15)
Digital platforms
Product innovation and international expansion aren’t the only reasons for Domino’s success. The company has embraced technology—one of the most important catalysts sparking Domino’s sales.
About 45% of Domino’s Pizza (DPZ) sales in the US were made on digital platforms in 2014. The company’s digital platforms are compatible with about 95% of tablets and smartphones in the US. The photo below shows a Domino’s iPad application that gives you a personalized pizza ordering experience.
In 2014, the company launched a first-of-its-kind ordering platform in the restaurant industry known as “Dom.” Dom is a voice-order app that allows customers to place orders without clicking or tapping on their digital devices. They just need a voice.
The company also launched a digital feature that allows customers to recall past orders, so next time they can place an order in as quickly as 30 seconds.
Starbucks (SBUX) has by far been the most successful restaurant chain at implementing technology alongside its loyalty program. SBUX makes up about 3% of the Consumer Discretionary Select Sector SPDR Fund (XLY).
Tracker
You may also be familiar with the famous Domino’s tracker that tracks your pizza step by step from order to delivery. It wouldn’t be a lie to say that Domino’s is a pioneer in pizza-industry technology.
Back-end technology
Besides making advances with customer-facing technology, Domino’s has also used technology to improve things at the back end and at the store level.
Domino’s introduced a point-of-sale system called PULSE that brings operational efficiencies and can train or assist franchisees to manage their business independently. About 99% of domestic franchises and 60% of international franchises are equipped with PULSE
Pizza Hut, under the umbrella of Yum! Brands (YUM), made over 40% of its US sales via digital platforms and 35% of sales in international markets. YUM accounts for about
Other restaurants are also trying to integrate technology into their businesses. McDonald’s (MCD), for example, has introduced self-ordering and payment kiosks in its European stores.
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