Domino’s Pizza: A bad day for it
At some point in time, we’ve all dealt with a customer who was unhappy. It’s natural. They’re promised a certain deliverable, feature, or service, and something breaks down. Some customers call you up, but others will express their disappointment to their colleagues, to their social media followers, and anybody else who will listen.
Sometimes you may fail to meet your customers’ expectations, but that doesn’t mean you can get angry or defensive and keep doing what you’re doing. It means you need to change. There is something that has failed, whether it’s a breakdown in communication or process or a bad product. Either way, you have to figure out what went wrong and fix the problem.
In 2010, the popular pizza chain Domino’s shifted their strategy after experiencing stiff competition and a major PR disaster. Before they made their changes, they committed to one simple strategy.
They listened to the bad feedback from their customers.
Setting the Stage
In 2010, Domino’s experienced a huge PR disaster thanks to a couple of terrible employees. In a highly inappropriate video, these employees contaminated ingredients and then placed these ingredients onto pizzas (which would then be served to customers).
Not only was the video disgusting, but it caused an outrage. This outrage caused the video to go viral. It was then picked up by a number of national news outlets.
It was a nightmare come true for any company.
This wasn’t the only thing playing against them. Their outlook looked quite bleak, even without this PR disaster. Strong competition in the industry, harsh customer criticism over the taste of pizzas, and low customer satisfaction were also playing against the company.
Domino’s solution is something that probably would have made most of us shake our heads in a planning meeting. They admitted that their product was awful. It was, at the very least, a surprising strategy.
The company spent millions in creating a new pizza, improving its menu, and advertising this entire process.
The campaign they used was called Pizza Turnaround. They used the campaign to acknowledge the problems they were facing and reinvent their pizza “from the crust up.” This included extensive media coverage, advertising spots in every major market, documentaries, promotions, taste tests, and national research.
If you’re interested, you can find the Pizza Turnaround website here. It includes a lot of what they did to promote their big changes.
The strategy worked. Within months of releasing the campaign and the new pizza, Domino’s reported a jump of 14.3% in same-store sales, one of the largest increases ever recorded by a major fast-food chain. That happened despite a 3% decrease in the pizza-delivery business.
Dominos was also able to foster an open, continuing dialogue with customers using new digital channels, like social media. The whole approach is still working, with their stock being valued above $90 a share.
Why should you care?
You should care because this can happen to you. Your customers are putting trust in you when they purchase your product. They trust that what they have bought will fulfil their needs and will perform to the expectations you provide them.
When that doesn’t happen, there is only one good approach. Openness, humility, and transparency are the only way to move forward.