Domino’s targets delivery apps with giveaway program

In a message of sympathy for smaller peers ravaged by the pandemic's business disruptions, and with an eye on the profits they lose as a result of delivery charges, Domino’s Pizza franchisees in select cities are distributing gift cards to customers to use in affected establishments. Participating Domino’s stores bought thousands of $50 gift cards from local restaurants, and have been randomly distributing them to Domino’s delivery customers so they can order directly from them and avoid delivery app fees. These local Domino’s stores have given away more than $100,000 worth of gift cards to roughly 2,600 customers throughout early November. The program includes Domino's stores in Greater Boston, Phoenix, Denver, Louisville, Kentucky; and Laredo, Texas. In an ad plugging the program, Domino's does not mention third-party apps by name, but the initiative seems to be a clear shot at delivery brands such as Uber Eats, DoorDash and Grubhub that have boosted their marketing during the pandemic, including with Super Bowl ads. The media buy includes a national TV ad. “Running a restaurant is tough. Our franchisees benefit from being part of a brand that has operations and technology built for delivery,” said Russell Weiner, chief operating officer of Domino’s. “However, many small restaurants don’t have a system for delivery. Meanwhile, third-party delivery apps are charging local eateries high fees to deliver, which are taking away much of their earnings. Domino’s and its franchisees were inspired to pay it forward in these communities by helping drive business to a few neighboring restaurants—without the substantial fees.” Ignited by the COVID-19 pandemic, delivery sales remain at elevated levels across the restaurant industry. For local establishments, participation in the channel can come at a high cost in the form of delivery fees charged to the outlets and to their customers by third-party providers. Many restaurateurs say these fees come directly out of their bottom lines. The program is an offshoot of a Domino’s campaign that highlights the hidden costs of delivery that it is calling “Delivery Frees.” That program, which began in August, promotes delivery orders through roughly 5 million product giveaways such as free pizzas or lava cake—or a gift for one of every 14 Domino’s delivery customers. Franchisees in the five above cities took it upon themselves to include restaurant gift cards as part of the promotion, a spokeswoman told Ad Age. Domino’s is separately offering a surprise party pack worth about $2,500 to winning customers who post a photo of their giveaway on Twitter or Instagram using the hashtags #Freesnotfees and #Sweepstakes. WorkInProgress, which was named Domino’s creative agency late last year, is helping to run creative for the event. Domino’s, which relies on home and carside delivery for the vast majority of its business, has been outspoken in its determination to steer clear of third-party delivery providers. “Consumers tell us that they hate the fact that these charges are often confusing, hidden or buried in the receipt,” CEO Ritch Allison said in a recent conference call, saying the promotion also aligns with its corporate values of transparency and value. “Domino’s and our franchisees never charge surprise fees. We charge one transparent delivery fee.” The latest campaign comes a month after Domino's reported a 1.9% decline in third-quarter same-store sales, missing analysts' expectations for an increase.

Domino’s targets delivery apps with giveaway program

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