Good Example Of Case Study On Domino's Pizza: A Case Study In Organizational Evolution

Domino’s Pizza has for a long time been dominant in both the domestic US market and the international marketplace. Located in over 65 countries and with more than 9,300 stores, Domino's is ranked the second best pizza restaurant after Pizza Hut. Despite its success and achievements, Domino's has come under criticism in the recent years for its low-quality pizza that lacks taste. This has led to a significant decrease in the company’s domestic revenue from year-end 2005 through year-end 2009. At the time, Domino's suffered greatly from a negative reputation among its customers in the marketplace. The negative reputation was mainly because Dominos supplied low-quality pizza made of inferior ingredients that lacked taste. The company fast came up with programs and campaigns to deal with the threat of losing customers. Taste deficiency and the growing preference for fresh products were addressed through the introduction of a reformulated pizza recipe in 2009. Besides, the company adopted one of the riskiest marketing campaigns of all time, the “Oh yes we did” campaign which publicly admitted the weaknesses of the company’s previous recipe. In a move to retain its customers, Domino’s also expanded its menu by launching Oven Baked Sandwiches that enabled effective growth in customer base and lunchtime revenues. In 2009, BreadBowl Pastas, American Legends pizzas, and Chocolate Lava Crunch Cake were introduced to customers. In 2011, Domino’s delivered boneless chicken and wings to customers. These brought not only new customers but also new head-to-head competitors as well.
The sales and growth of Dominos is driven by three business segments including domestic stores, domestic supply chain services, and international supply chain services. All the segments are under the support of Domino's World Resource Center, which is responsible for the provision of accounting, marketing, legal, franchise development, and human resources support among others. The domestic stores comprise 454 stores owned by the company and 4,475 franchise stores which are operated by entrepreneurs. Conversely, the domestic supply chain services segment consists of dough manufacturing and supply chain centers which have the responsibility of producing fresh dough daily and also purchase, receive, store and deliver pizza related food products to the company's owned and franchise stores. The international segment’s role is to oversee the network of 4422 international stores around the world. Besides, the segment also manufactures and distributes food and supplies.
Despite Domino’s dominance in the market place due to the acceptance and appreciation of pizza by customers, one of its major threats is the substitute products within the pizza industry. This has in the past made the company lose customer resulting to decline in sales. Additionally, Domino’s has several competitors in the domestic and international market, both large and small. However, the most significant and serious competitors to Domino’s are Pizza Hut, Papa John’s, and Little Caesars. Stiff competition also comes from smaller locally owned restaurants as well as other fast-casual and delivery restaurants that fall outside the pizza industry. In overcoming the competition, Domino’s has embraced various strategic approaches. For instance, the company selects locations that benefit its core strategy of carryout and delivery as it does not accommodate customers who would wish to dine within its premises. Moreover, the company has consistent and logistical operations that keep overhead costs down and provide a less expensive pizza. The other challenge to the company is the demographic changes in the market which have since increased people’s awareness and consciousness on the consumption of pizza.