Domino's gears up for UK launch of loyalty program
Domino's plans to introduce a loyalty scheme in the UK, aiming to increase purchase frequency However, CEO Andrew Rennie emphasizes that the scheme alone won't be a magical solution to boosting the brand's sales
In the UK, Domino's is preparing to introduce a loyalty scheme in 2024. The pizza company has confirmed that by the end of 2023, its ecommerce platform will be equipped to support this feature. During an investor meeting on November 9th, CEO Andrew Rennie did not specify the exact launch date of the loyalty programme, but he emphasized the company's commitment to increasing consumer frequency, stating that they will do "whatever [they] can" to achieve this goal.
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According to Rennie, implementing a loyalty scheme will be a crucial part of the process. However, he emphasized that a loyalty program should not be seen as a magical solution to increase consumer engagement.
"I am cautious about simply adopting a loyalty program because it is expected and believed to be a game-changer," he stated.
He warned that loyalty offerings can sometimes be used as “a short-term sugar rush” and that he was focused on long-term growth at the brand.
“We don’t want to rush it,” he said.
Promotions are a nice way to help the consumer and bring them to us, but they’re not the be all and end all.
Andrew Rennie, Domino’s
Rennie, the new CEO of Domino's UK since August, adopted a more cautious approach this quarter in contrast to the brand's previous messaging.
During his speech in early August, the interim CEO Elias Diaz Sese expressed his enthusiasm for the loyalty scheme's potential.
"We are currently the sole company in the industry lacking a robust loyalty program," he informed investors regarding the company's half-year results.
He referenced Domino's US business as an example, highlighting its successful implementation of a loyalty scheme that resulted in a 1.7 times increase in purchase frequency within the first year.
The brand's new CEO emphasized that the company's emphasis on purchase frequency involves more than just its upcoming loyalty program. However, he did confirm that the platform is "on-track" and ready for finalization.
The new ecommerce backend platform will enhance the brand's digital capabilities, enabling faster installation of updates and promoting agility in promotional and marketing endeavors.
This quarter, the brand saw success in its digital offering. It now has 8.7m active app users, a 55% increase versus the same period last year.
Broad-based focus
Rennie highlighted his focus on adopting a comprehensive and sustainable strategy to foster business expansion. Additionally, he emphasized the importance of not excessively relying on promotional efforts for Domino's.
"Promotions serve as a helpful means to attract consumers, but they should not be viewed as the sole solution," he expressed.
His main priority is to provide "overall value" to consumers. In addition to increasing customer visits, attracting new customers is a significant objective for the brand. He mentioned that Domino's currently has access to approximately 85% of households in the UK, indicating there is a great potential for the brand to target new consumers.
Stores in new locations have seen very high sales upon opening, he said, demonstrating how “people are calling out” for access to the brand.
