20% Drop in Sales Since Dominos Came to Town

[NYFLPizza]

Gotta do something as a dominoes just went in a few miles down the road last month and over that time we’ve taken a 20% drop in sales.

Anyone else ever face a situation like this? How long did the “novelty” of the new place last, and when/if did sales start to recover? What ideas did you have that worked to help bring sales back up at your place?

One plus is we just got our beer/wine license on Friday. We need to push this immediately.

We do delivery, dine in and take out and can seat about 40. Maybe we need to start to push the things that we have that they don’t like pasta dishes and beer. I’ve always thought that these places wouldn’t be much competition to us since the quality of the product is so different, but I guess I’m wrong. I still can’t say for sure that this is why we’re so slow as I mentioned earlier, January is always a terrible month, but one other thing that has me considered is our dinner sales have taken the big hit, not our lunch sales. Dinner is where we’ve always prospered. This is where a place like dominos focuses on since they don’t cater to the lunch crowd.

The food business can drive a man crazy…

 

[BCPizza]

Big dave ostrander has an article on his website about what he did when this happened to him.

 

[jokergerm]

Market market market

We are taking dominos head on and you just have to market over and over, take thier coupons make a better product, hire more drivers to keep your delivery times at 30 min or less. No one wants to wait an hour

 

[brad_randall]

Do you have a Point-of-sale system that can generate a database mailing list?

 

[Kris]

When it happened to us we focused (like you said) on things we have and deliver that they don’t, won’t and can’t. This includes great pizza!

 

[system]

the novelty hasn’t worn off since the '60’s. they used to stick with larger marketing areas, universities and such but are now invading small towns. the one that opened in gunnison, co. went out of business though and i had a shop there. how do you take their coupons when a dominos large is 14"? my medium is 16" and i don’t have a 14". i was with dominos during high school, college into management way back working with tom monoghan, john correll. they recently moved here and are killing me since my business model IS dominos. not hard to make a better product though, like by adding some spices and real ingredients, don’t freeze the dough. j

 

[NYFLPizza]

jokergerm:

Market market market

We are taking dominos head on and you just have to market over and over, take thier coupons make a better product, hire more drivers to keep your delivery times at 30 min or less. No one wants to wait an hour

This just doesn’t seem practical. We’re not Dominos. We use grande cheese, fresh dough, homemmade sauce. How are we supposed to charge what they do for all the processed food?
brad randall:

Do you have a Point-of-sale system that can generate a database mailing list?

Yes, we do. What have people found to be the best way to utilize this database of addresses?

 

[RobT]

I think you just got a double screw due to timing.

January is relatively a slow month in the pizza business, & a competitor opened up.

Has your service suffered at all?
Are you using boxtoppers?
Are you doorhanging?
Are you mailing menus?
Is your delivery service fast?

Lots of things you can do, but i would suggest you at least mail menus to your database.

 

[wa_dave]

For what it’s worth we did a intense marketing campaign before a chain opened 100mts up the road from us that held our sales, and even marginally increased them.
We did a FREE SMALL (10") pizza offer. We did an initial 8,500 newspaper insert for 150 FREE small pizzas, then followed it up with randon postings of unaddressed mail to 200 households in each of the 5 suburbs surrounding the shop (done 2 weeks apart). The letter had if you are an existing customer then this is a thanks. If you haven’t tried us then this is the opportunity to do so absolutely FREE. Why FREE? Because we know once tasted you will wonder why you ever went elsewhere before.
We pulled in heaps of new customers from this promotion and starved the new chain of customers going there.
All it cost was a few hundred in advertisng/printing (my major supplier chipped in $500 to assist) and the cost of goods of the pizzas.
Maybe have a look at a similar promo using a smaller pizza than normally sold - a taste tempter. If they like it (as they did with ours) they will stay.
It’s a good way to promote, get people in the door, upsell (we charged $5 to upgrade to the next size which covered all costs plus gave a small profit) but more importantly get them tasting and getting names on your data base.

Dave

 

[jokergerm]

NYFLPizza:

jokergerm:

Market market market

We are taking dominos head on and you just have to market over and over, take thier coupons make a better product, hire more drivers to keep your delivery times at 30 min or less. No one wants to wait an hour

This just doesn’t seem practical. We’re not Dominos. We use grande cheese, fresh dough, homemmade sauce. How are we supposed to charge what they do for all the processed food?
brad randall:

Do you have a Point-of-sale system that can generate a database mailing list?

Yes, we do. What have people found to be the best way to utilize this database of addresses?

I think it’s very practical, we make our own sauce from saporito and make our own dough everyday and shred our own cheese, not grande cheese but LMPS Della vita cheese

Would you rather have 15k in sales at 25% food cost or 30k at 33% food cost and be able to compete with dominos pricing.

It may not work for you but we have been doing it forever with great results

 

[NYFLPizza]

jokergerm:

NYFLPizza:

jokergerm:

Market market market

We are taking dominos head on and you just have to market over and over, take thier coupons make a better product, hire more drivers to keep your delivery times at 30 min or less. No one wants to wait an hour

This just doesn’t seem practical. We’re not Dominos. We use grande cheese, fresh dough, homemmade sauce. How are we supposed to charge what they do for all the processed food?
brad randall:

Do you have a Point-of-sale system that can generate a database mailing list?

Yes, we do. What have people found to be the best way to utilize this database of addresses?

I think it’s very practical, we make our own sauce from saporito and make our own dough everyday and shred our own cheese, not grande cheese but LMPS Della vita cheese

Would you rather have 15k in sales at 25% food cost or 30k at 33% food cost and be able to compete with dominos pricing.

It may not work for you but we have been doing it forever with great results

Clearly I’d prefer the latter, and I know you’re just making an example, but we’d need to make a substantial increase in volume to make it work.

 

[indie_pizza]

I know it’s hard to do, believe me, it’s hard to do. But, drop the Grande. I don’t know what blend you’re using, but when I dropped them and went to a 100% Mozzarella on my pizzas, I heard/hear so many comments about how many more people comment on how they like the cheese on our pizza. I rarely heard that when we took over our store and switched from a synthetic cheese to Grande (which I used for about a year).

As far as the Dominos thing, you just have to wait out the newness of it all. We just had a little ceasers open, and ANOTHER fast food burger joint plus a small, regional fast food joint open in the last few months here. It’s prime time buying season for the chains. You just have to gut it out and fight your way through it, or find something else to do.

I’ve said it before, I’m lucky I don’t have to make a profit (ever) in our families situation, don’t really know how the rest of you guys do it.

 

[BCPizza]

Grande is overrated and over priced IMO

 

[brad_randall]

NYFLPizza:

brad randall:

Do you have a Point-of-sale system that can generate a database mailing list?

Yes, we do. What have people found to be the best way to utilize this database of addresses?

The standard model is to track customers that have been active in the last 30 days and inactive for 30-59, 60-89 and 90-120. Then mail each address in the 30, 60 and 90 “lazy” groupings a progressively more aggressive offer to get them to reactivate. If you do this consistently every month, your # of active customers should increase as you maintain your database and you get 3 bites at the apple before you’ve considered yourself to have lost a customer.

You’re not Dominoes, don’t try and be them. Focus on your differences (tangible, positive ones in a positive manner) and build your offers and messages based around them.

 

[indie_pizza]

Can you give an example of “progressively more aggressive offers” including what your $ or % discount is on them? I’ve seen people talk about doing this a lot, but I don’t know how to do this correctly so I’ve not even tried to do it. I know it’s a huge mistake, just something I’ve let slide for a long time.

 

[Patriot_sPizza]

One simple promo I do with much success, is to FB or text blast free mozzarella stix or free garlic knots w/each LG pizza when you order on-line…

I’m more of a volume/discount pizza joynt in a college town, but it works well…helps build my database too, as they must order on-line…

You can also make a deal when a new friend/customers also orders (a minor challenge to configure) the original gets another freebie…

Couple 2 LG pies, bread stix & a soda & knock off $2-4$ vrs a % off…% off is difficult to percieve, whereas saving $4 or so is more tangible in some folks eyes…

 

[brad_randall]

I’m trying to entice people to use my online ordering right now. In the past, I tried to keep things really simple for my employees and myself by advertising the set of standard specials we already had in place - usually sending the same offer to the whole mailing list. With my online system, I can set up any bizarre deal I want and the POS just discounts the final total accordingly.

This month I’m planning on offering 5/10/15% off any order to each of my 30/60/90 groups respectively, but it will only be redeemable online. Although, I’m still kicking around the thought of doing something like 7/9/11% instead just cause those numbers are so odd they might draw more attention in giant, bright font on the front of a postcard.

In the future I’ll try FREE halfsticks to 30, FREE breadsticks to 60, and FREE wings to 90 with a pizza purchase. Maybe even $1/$2/$3 off any large pizza another time. Keeps it fresh and I might stumble onto something that really works well.

Most important thing though (more so than the deal) is keeping my name in front of customers.

 

[Pakula_s_Pizza]

indie pizza hit the nail right on the head. Drop the most consistent cheese on the market. the one that provides you with the materials to succeed. go find something that will save you thirty cents a pound, totally changing the product that the other 80% of your customers still buy. when Going up against the worst pizza in the world, lower your quallity. great advice. I cant wait to go to restaurant depot in the morning to pick up ketchup to use as my pizza sauce. at least Its cheaper.

 

[RobT]

Pakula's Pizza:

indie pizza hit the nail right on the head. Drop the most consistent cheese on the market. the one that provides you with the materials to succeed. go find something that will save you thirty cents a pound, totally changing the product that the other 80% of your customers still buy. when Going up against the worst pizza in the world, lower your quallity. great advice. I cant wait to go to restaurant depot in the morning to pick up ketchup to use as my pizza sauce. at least Its cheaper.

Wish there was a “Like” button for this post.

 

[pcuezze]

Wow. I walked into a firestorm…

Anyway, how do you communicate to your customers that your product is superior? You can’t rely solely on their tastebuds. They need to be told WHY you have the best pizza in town. We have table books which explain all about what makes Grande a superior product: why whole-milk mozzarella is superior to part-skim, the advantage of having no fillers (gas-flushing), etc. I occasionally post these things on Facebook and always mention them in media discussions. Train your employees to do the same. Challenge your customers to ask a Dominoes employee what brand or type of cheese they use (or even what blend).

I’ve learned in my first year that having a good product is important but telling the guests you have a superior product is even more important…