Marketing Management

Part A

Marketing is about identifying and meeting human and social needs and one

of the shortest good definitions of marketing is meeting needs profitability (Kotler &

Keller, 2012). Before begin to marketing mix or 4p’s, understanding of STP is a must.

The terms of STP include market segmentation, target markets and positioning.

Segmentation is about identifying the segments for the products or services,

and grouping consumers by some criteria such as within a group which respond

similarity. The potential segmentation variables are such as age, sex, income, educational

level, marital status, culture and etc. Useful segments should be profitable, accessible and

measurable. The objective for segmentation is to find the attractive markets and strategy

involve select which segment to target, break market into components and regroup into

market segmentation.

Domino’s had targeted consumer who looking for inexpensive pizza quickly

because customer are very price sensitive, increase prices will led to decrease of sales.

Domino’s are more focus into delivery and carryout customer compare to dine-in stores.

Viewing in demographic, Domino’s seems not to have a specific target and just targeting

greatest number of people and to be the leader in online pizza ordering.

After segmentation, it will goes to the target market and to find out which

segment should be targeted. This is the real objective that marketer want to achieve in

market. A good target market need to understand the demographic profile of the product

category, must know to compare with competitors, the percent of the population and

segments must be identifiable.

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Domino’s started with targeting students which located near University of

North Carolina and had served 25,000 enrolled students. Domino’s identify the best way

to reach as many students as possible. In Malaysia, Domino’s target is trying to expand in

nationwide by 2014. “According to President and Chief Operating Officer Ba U Shan-

Ting, outlets will be launch in Kelantan, Terengganu and Pahang next year and enter

Sabah and Sarawak in 2015” (TheMalaysiaTimes.com).

Next, after target market will move on to the positioning which this is a vital

element and skill in a good marketing. In positioning, need to determine the way

consumer currently think about the products, decide how you want consumer think about

your product and form out how to reposition. Understanding the levels of competition are

very important because positioning apply in all levels of competition such as industry

level, product level and corporate level, so what is Domino’s positioning.

Domino’s positioning is to reach the customer who values a quick service pizza

by using the geographic information software to reach nearer locations. Domino’s trying

to serve a hot pizza in delivery therefore it created the 30 minute delivery guarantee and

use heat wave insulated delivery bag. In 2009, Domino’s achieve a 92% on time delivery

and achieve the growing segment in online ordering markets through website. Most of the

Domino’s domestic stores are placed in the mid-sized or large cities or nearby the college

or university campuses.

“Most of the companies which are successful are concentrating with the 4p’s

which are product, price, place and promotion” (Gregory Dean, 2010). Product is about

the quality, design, features, brand name, packaging, sizes and services. Domino’s had to

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focus on flavors to capture the market. Example, Butter chicken and the Masala were

confined to the North while Mutton Ghongura and Chicken Chettina confined to the

south.

Price is concern about the payment period, discount, credit terms and allowances.

Domino’s fixed a price of Rs 265 for a 12 inch pizza. Indians are value and not price

sensitive, Domino’s set the price high because the high quality of ingredients and offer

value to customer. In Australia and Spain, Domino’s reduce the price and give discount

to attract customer for the Pepperoni and Jalapeno pizza to compete with Pizza Hut.

Place is about the transport, location, inventory, coverage and etc. Domino’s has

the largest network of outlets across the world. Refer into the channel of geographic

region or industry which a product or services is sold to which segment such as adults,

family and business people are also refer into the environment which the product is sold

may affect the sales.

Lastly, promotion is concerning in the public relations, direct marketing, sales

force, advertising and sales promotion. Domino’s had use advertising, sales promotion

including the education publicity for promoting the services.

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Part B

1.0 Introduction

Domino’s started with one small store in 1960. Then, in 1978 the 200 th Domino’s

store opened and things really began to cook. Domino’s pizza can known as an

international pizza delivery company and the second largest pizza chain in Michigan,

United States.

1.1 History

In 1960, Domino’s Pizza was found by Tom Monaghan in United States in

Michigan and landed in Malaysia in September 1997. Domino’s can know as the delivery

expert company in pizza industry and have around 98 outlets in Malaysia which located

in different states such as Melaka, Perak, Negeri Sembilan, Kedah and Pulau Pinang as

well as seen in year 2012. In 2009, Domino’s establish their businesses to Singapore

because of the healthy growth in Malaysia and now, there have above 10 outlets in

Singapore which growing very well.

1.2 Mission Statements

The vision “Think pizza, choose Domino’s’ and the mission, ‘A passionate team

in pursuit of becoming the unrivalled No. 1 pizza company in Malaysia’. Domino’s Pizza

is passionate about delivering quality food and service. The product and service is all

about convenience, fun, sharing quality time together with friends and families over a

delicious pizza meal delivered from hot and fresh oven to customer’s doorstep.

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1.3 Goals and Objectives

The objectives for Domino’s Pizza are to become the No.1 delivery expert in the

world’s leading pizza and do their best all the time to give the good quality from the

products to the services in all aspects and maintain the current good reputation from

customer which is the quick delivery service.

1.4 Products and Services

Domino’s had come out with a ’30 minutes delivery guarantee’ to their customer

which mean Domino’s will give a free regular pizza voucher if they could not be

punctual to the destination. In addition, Domino’s also provide a ’15 minute’s take-away

guarantee’, otherwise will free a personal pizza on the next order for their customer.

Domino’s also offering free delivery to their customer which no additional charges and

has a product satisfaction guarantee with a Nett Pricing as well.

 1.5 Core Competences/ Competitive Advantage

Domino’s Pizza have a special size of pizza compare to Pizza Hut and Papa

John’s which is 15 inch as known as extra large pizza whereby suitable for people who

celebrate party. The company competencies include the online GPS tracker which

allowed consumer to check their pizza delivery status which benefits the organization and

customer.

2.0 Market Analysis

Domino’s started trade common stock in the New York Stock Exchange with the

symbol of ‘DPZ’ in 2004. In Dublin and Ireland, Domino’s hit a turnover of $3 million

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per year. In 2008, an online application launch by Domino’s which the GPS Tracker. It

allow customer to check the status of pizza processing.

2.1 Industry Analysis

There are many pizza makers ranging to international franchises from local

pizzerias such as Domino’s Pizza and Pizza Hut. By viewing into the current health

issues, today’s society as well as economic recession most of the companies are being

forced to follow the healthier and cheaper products. Many companies had added salads

into their menu because consumer now is concern in healthier choices. The popularity of

Internet had become the market trend and market needs as well as the mobile because it is

changing the traditional ways of ordering a pizza.

2.2 Competitive Analysis

Domino’s competes with McDonald’s, Pizza Hut and Papa John’s in Malaysia.

McDonald’s own a very strong image throughout the worlds and Pizza Hut is the largest

competitor for Domino’s in pizza industry and both of this company trying to maintain a

good image to compete. Followed by Papa John’s recently are increasing competition to

Domino’s because of their rising popularity.

2.3 SWOT Analysis

This analysis is to identify Domino’s strengths and weaknesses and correlate with the

opportunities and threats in order to achieve to goals of the company.

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Strengths

Domino’s have a very strong brand image and it is the leading pizza delivery

company with more than 5000 stores in US. It has high brand equity assists by

marketing campaigns and the heavy advertising. Domino’s have its loyal

customers so it can helps the company when they come out with a new product

and have a strong network with its franchises therefore it able to increase the

market shares and sales. In Canada, Domino’s created the world largest pizza

fight every year.

Weaknesses

Domino’s have a major weaknesses which they experienced a sales decrease in

their store which bring down the brand image and the revenues of the company.

This had decline the amount of domestic franchises in 2008. Domino’s will try to

increase back in the next few years for this issue. Besides, the slow growing or

declining sales happen affected by the poor quality which not up compare to the

competitors and the menu are too simple compared to other chains.

Opportunities

Domino’s have their own opportunities and the most major one is the efficient

delivery pizza compare to the competitors. This is a way to expand their operating

effectiveness. Domino’s had offer a services on the mobile application and its

work because many sales are come from iPhone application. There is a big growth

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happen in India and China’s population and this will help to increase their

revenues.

Threats

The increases of food price would be a threat for Domino’s because it impact their

businesses by increasing their operating costs. Besides, the fight of the pizza

delivery industry is absolutely a threat for Domino’s as well. In the fast food

industry, there are always new businesses being crated. In addition, there is

another threat which is people now is concerning with their health issues and this

could affect the profits of Domino’s.

3.0 Market Product Focus

Nowadays, fast food industry is facing healthy issues problems. Therefore,

Domino’s should come out with healthier choices for consumer. Okonomiyaki Pizza is a

pizza and this product operates wells in Taiwan. It is a Japanese savory pancake

containing variety of ingredients that consists of batter and cabbage. Selected toppings

and ingredients are added which can be very greatly.

3.1 Marketing and Product Objective

To enlarge the specialty with healthier choices pizza for consumer and to increase

sales for the company to maximize profits.

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3.2 Target Market

The target market for Domino’s Okonomiyaki Pizza is active in all the stores of

Domino’s Malaysia. A selected area will be more focus such as Subang Jaya, Sunway

and KL which nearby the college or university campus. The main target customer and it

was especially aim to the people in the age group of 16 to 64 are its main target group for

communication which was the young adult from the college student and the adult from

working group. The demographic of the market is to attract the customer from the middle

class and upper middle class because this groups of customers need to spend their money

to enjoy the fast food but in low price. It also target people who want to take a break from

what they eat every day or from cooking.

3.3 Points of Difference

Okonomiyaki Pizza contains healthy dose of bonito flakes which bonito is a type

of fish and come with cabbages toppings which can compete with the competitors in

concerning health issues.

3.4 Positioning

Okonomiyaki Pizza is to create a healthier image to change consumer perception

or consumer mind which is unhealthy to improve better.

4.0 Strategy of Implementation

Okonomiyaki Pizza create is to more focusing on the health issues today and to

develop a different style and culture of pizza for Domino’s in Malaysia to compete with

the competitors.

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4.1 Product

The name of this new product is Okonomiyaki Pizza which already launch in

Taiwan. The standard ingredients of this pizza include healthy bonito flakes which are a

type of fish, stir-fried noodles, Japanese mayonnaise, powdered seaweed and plenty of

shredded cabbages mix with flour and grilled it. The toppings can be chosen or add on

greatly such as mushroom, vegetables, shrimp, squid, chicken and octopus. The sizes of

the pizza include 6 inch, 9 inch, 12 inch and 15 inch as well. The delivery services are

available.

(Source: DominosTaiwan, 2012)

4.2 Pricing

The basic understanding of cost involved is very important to avoid no earnings.

Found that the ingredients for the Okonomiyaki Pizza are not very expensive, therefore

can sell it in a reasonable price to compete with McDonalds and Pizza Hut such as using

set lunch or family combos. The ala-carte price pizza for the Okonomiyaki Pizza will be

RM 9.90 for 6inch, RM 21.90 for 9 inch, RM 30.90 for 12 inch and RM 41.90 for 15

inch. Ala carte will be slightly expensive compare to set, so will provide more set value

and set dinner even family package dinner for customer in the promotion strategy.

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4.3 Place

This product will launch in Malaysia and will active in Domino’s pizza outlet. It

will be more focus in selected areas such as KL, Sunway, Subang Jaya and Petaling Jaya

which nearby colleges or university campuses around that area to target the college

students and foreigner students. Another area will be focus is the office shop lots which

target the working adults who prefer healthy fast food during their short break time with a

comfortable environment during the hot weather in Malaysia.

4.4 Promotion

Create a set lunch for the Okonomiyaki Pizza which include one pan of 6 inch

pizza and comes with a jasmine tea and two slices of fruits to emphasize the healthy tag

line which can fixed the cost around RM7.90 net per set to attract teenagers, students or

working adults from 12pm to 3pm which is dine in only. Okonomiyaki Pizza should be

added into the menu with another column to shows the ingredients contain, and shows

new specialty pizza compete with the competitors. Advertising is a need to promote this

new product to create awareness among the consumer and giving out coupons or voucher

is an advertising which can increase the sales as well. Internet advertising such as using

groupons, dealmates and etc which sells voucher through online can be consider because

nowadays people are attracted to this marketing strategy which goes well in Malaysia.

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5.0 Financial Data and Projections

5.1 Expected Market Share

The health conscious of consumer towards fast food industry will affect the profits of

the company. Therefore, developing healthier or new product may increase back the

sales and market share. For example, McDonalds launch a new product which is

Grilled Chicken Burger (GCB) which contains lowers calories and had attracted

many customer in addition the sales and market share increase during the period. Is a

fact and should believe that Okonomiyaki Pizza will have the same result as well

because it is a product that concerning in health issues by looking in fast food

industry. People do not mind to have a try to choose healthier foods. Therefore, the

expected market shares for Okonomiyaki Pizza will increase the Domino’s market

shares.

5.2 Expected Net Revenue

To calculate the expected net revenue for Okonomiyaki Pizza set lunch, with a RM

6.00 gross profit per unit sold, the expected unit sold per year is 40,000. Therefore,

the Okonomiyaki Pizza net revenue will be Rm6.00 X 40,000 units = RM240000.

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6.0 Implementation Plan

6.1 Gantt Chart

List of Activities Jan Feb Mar Apr May Jun July Aug Sept Oct Nov DecTo develop market testing effectively.                        To do an office offer for the working adults.                        To do a promotion campaign in colleges.                        To do an offer voucher in the internet such as Groupons.                        To do a contest, win an Ipad seasons!                        To develop a new toppings turkey for Christmas                        

6.2 Promotion Schedule

List of Activities Description

To do an office offer for the working adults.

 A set lunch of office promotion will cost RM6.90 during 12pm to 2pm include a 6 inch Okonomiyaki Pizza with a jasmine tea.

To do a promotion campaign in colleges.

 A roadshow of giving out voucher RM3 for Okinomiyaki Pizza after clicking a ‘LIKE’ to our Facebook Fan Page in college and university campus in selected areas. Terms and Conditions apply.

To do an offer voucher in the internet such as Groupons.

 A set of family combo with a nett price of RM50 include two pan 9 inch of Okonomiyaki Pizza, 4 cups jasmine tea, one plate of fruits and 4 pieces of chicken wings. Dine-in only.

To do a contest, win an Ipad seasons! Fill in the answer for the question given in the contest, staple with a receipt purchasing above RM10 to win an Ipad.

To develop a new toppings turkey for Christmas

 A new ingredients which is Turkey toppings to celebrate Christmas together with Okonomiyaki Pizza

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7.0 Evaluation and Control

Evaluation is to evaluate the sales or revenue of the product and to control the quality and

understand the risk that will be faced.

7.1 Quality Control

To ensure the quality control, ingredients should always be fresh to be cook.

Training should be provided to the staff to ensure the staff be able to cook well and

serve the good quality food in a right ways to the customer.

7.2 Risk Analysis

The amount of shredded cabbages must be concern when mix with flour to avoid the

uncooked cabbages eaten by customer. All the ingredients must be fixed and

measure accordingly to avoid problems happen which may affect the sales. The

ingredients must put in a suitable place and temperature to avoid wastage such as

octopus and shrimp.

7.3 Evaluation Analysis

Based on the market share expectations, Okonomiyaki Pizza sales analysis will be

conduct every 6 months and adjusting the promotion budget accordingly.

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8.0 References

http://www.dominos.com.my/corporate/Corporate.aspx

http://investorplace.com/2012/11/the-craziest-dominos-pizza-youve-ever-seen-guaranteed/

http://www.brandeating.com/2012/11/around-world-dominos-taiwan-offers.html

http://business.library.wisc.edu/resources/kavajecz/10_Fall/Dominos_Report.pdf

http://www.ukessays.com/essays/marketing/consumer-segments-on-dominos-pizza.php

Dominos.uk.com. (2011). Available from: http://www.dominos.uk.com/aboutus.aspx

http://www.themalaysiantimes.com.my/domino-expanding-nationwide-by-2014

http://marketography.com/2010/03/09/dominos-pizza-beyond-the-dough/

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