WORKINPROGRESS, Boulder / DOMINO'S PIZZA / 2022
Why is this work relevant for Titanium?
Employment is more fluid now than ever before, especially for QSR restaurants. In a gig economy that thrives on ride-sharing and side-hustling, the line that separates consumer and employee is increasingly blurred. As a leader in pizza delivery for decades, Domino’s didn’t just recognize that shift––we acted upon it, completely reframing the customer/brand relationship by tipping carryout customers $3 to do what our own delivery drivers always have. In order to change customer behavior, we started by changing our own, effectively paying our customers to *not* order delivery, and rebranding a simple discount coupon to do it.
Like nearly all QSR restaurants in 2022, Domino’s faced monumental recruiting and hiring challenges within an increasingly selective labor market. In the midst of a nationwide delivery driver shortage, they needed to make a business pivot that would boost carryout orders (which require significantly less manpower than delivery) ultimately relieving pressure on shorthanded stores and current delivery drivers. Pulling it off required changing a core customer behavior that we’ve ingrained over several decades: after years of Domino’s innovating new and unique ways to deliver your pizza, now it’s your turn to take the wheel.
Describe the creative idea
Tipping your pizza delivery driver is a practice as old as pizza delivery itself. But in the midst of a historic labor shortage, there simply weren’t enough drivers to tip—or deliver pizzas. So we turned to a group who already had the skillset to deliver for Domino’s, our own carryout customers, and tipped them $3 for doing what they already do well––delivering their own pizza to themselves. Now when you pick up Domino’s, you’re no longer just a customer. You’re a delivery driver. Turning the tip convention on its head would not only reward existing carryout customers, but also inspire more people to order carryout instead of delivery when driver staffing was low. After all, as a brand that’s known for our delivery expertise, we believe that every great delivery deserves a tip. Even if the delivery driver is also the customer.
Describe the strategy
While Domino’s was facing a very real staffing shortage, there was no shortage of demand for pizza delivery during the pandemic. The brand needed an immediate, strategic solution that would encourage a significant portion of customers to switch from delivery to carryout. It may sound straightforward, but data has shown that convincing habitual delivery customers to make the switch is not a simple task, even more so after customers became increasingly reliant on delivery throughout COVID. Our solution to changing this core customer behavior was to reward that shift with a $3 “delivery driver tip" in the form of future store credit. This novel reward system enticed current customers with a fantastic deal, incentivized future carryout orders via store credit, shortened the average customer purchase cycle upon redemption, and struck a chord with consumers by recognizing the hard work required to get pizza from our store to their door.
Describe the execution
The Carryout Tips campaign launched nationwide in the US on January 31, 2022, supported by multiple TV broadcast spots, digital video, radio ads, live-reads, paid social, out-of-home and direct mail. The campaign will continue to run until May 22, 2022. Each carryout customer was able to claim their Carryout Tip directly after purchase on the Domino's app, or via order confirmation email. Once claimed, they could redeem their tip as a $3 discount on another Domino’s order the following week. Once customers claimed their tip the following week, they received another tip on that order—continuing in perpetuity. By linking each tip to a future order, we were able to reduce the average purchase cycle, encouraging incremental return carryout orders.
List the results
While we legally are not able to disclose official sales results yet, the public and press reaction to Carryout Tips has been overwhelmingly positive. The brand action has been picked up by dozens of prime media outlet, generating over 2 billion earned media impressions. Considering the brand’s overarching goal of shifting their customer mindset and behavior away from delivery and towards carryout, the campaign has been a clear success. The discount mechanic not only encouraged repeat carryout purchases, but by limiting tips to online orders only, we were able to traffic the entire experience through Domino’s digital channels––furthering consumer engagement with the website, email and app, rather than labor-intensive phone calls in stores.
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