Domino’s Latest Delivery Tech Will Find Customers

Domino's on Tuesday announced a new convenience-driven innovation—Domino's Pinpoint Delivery, which allows customers to receive a delivery nearly anywhere, including places like parks, baseball fields, and beaches. Customers with the Domino's app can select Domino's Pinpoint Delivery, drop a pin on the map, and pizza will be on its way.

Domino's said it’s the first quick-service restaurant brand in the U.S. to deliver food to customers with the drop of a pin.

"Domino's is proud to be the first quick-service restaurant brand in the U.S. to deliver food to customers with the drop of a pin," Christopher Thomas-Moore, Domino's senior vice president—chief digital officer, said in a statement. "We're always striving to make customers' experiences even better and more convenient, and Domino's Pinpoint Delivery does exactly that."

With Domino's Pinpoint Delivery, customers can receive their order at a countless number of dynamically created hyper-local spots without a typical address. Domino's Pinpoint Delivery enables customers to track their order with Domino's Tracker, see their driver's GPS location, view an estimated time of arrival, and receive text alerts about their delivery. Domino's will also alert customers when their delivery expert arrives at the pickup spot, at which time they can activate a visual signal on their phone, which will help the driver spot them.

"Domino's has a long history of innovating within the delivery space, dating back to 1960—from pioneering pizza delivery to launching the industry-first Domino's Tracker, and rolling out the largest electric pizza delivery fleet in the country," added Thomas-Moore. "Delivery innovation is at the core of who we are, so we're thrilled to give customers a new delivery option by allowing them to receive their order nearly anywhere, with the drop of a pin. No address? No problem. With Domino's Pinpoint Delivery, customers can get their favorite menu items just about wherever their adventure takes them—whether they're soaking up the sun at a beach or having a picnic with friends in the park. Domino's Pinpoint Delivery makes enjoying pizza more accessible than ever."

The technology mirrors an initiative Domino’s launched in April 2018 when it activated over 150,000 “Hotspots.” Despite the name, there was no WiFi involved. The technology wasn’t as sophisticated in its finding ability, essentially directing a user toward a “hotspot” rather than making their location one, or a “pin” for the driver to find. Previously, Domino’s would identify where the guest was, and then a “Hotspot” would appear on a map for the customer to choose from. Say, a nearby park or stadium. Before checking out, guests had the ability to leave instructions to help the driver find them. Versus the tracker tech, much of the communication on order confirmation and progress, ETA, was done via text.

Tuesday’s announcement is the concept evolved with more in-tune technology. But like the prior iteration, it’s a service that can target occasions as much as addresses.

Domino's

U.S. same-store grew 3.6 percent in Q1, but delivery remains challenged.

Domino's

This past quarter, Domino's crossed 20,000 units globally, finishing at 20,008.

And it arrives at a juncture when Domino’s delivery business continues to face pressure from multiple sides, namely due to the battle to find drivers. In the first quarter, the chain’s delivery same-store sales dropped 2.1 percent, rolling over a 10.7 percent decline in 2022. Domino's attributed the dip to customers opting for dine-in occasions and guests tightening their budgets. However, the company noted, delivery service times improved over a minute in Q1 and Domino's gained market share in quick-service pizza delivery overall.

The brand remains committed to first-party fulfillment, although it has a $1 billion international business with third-party delivery aggregators.

Meanwhile, in the U.S., carryout same-store sales rose 13.4 percent in Q1 on top of 11.3 percent growth in 2022. The channel accounts for half of Domino's business. Returning to the inflation point, company is experiencing trade-down from non-Domino's carryout to Domino's carryout, executives said.

Overall, U.S. same-store grew 3.6 percent, rolling over a decrease of 3.6 percent last year. The increase was fueled by a rise in average ticket, thanks to 6.2 percent pricing. That was partially offset by lower order volume.

This isn’t strictly a Domino’s turn. Generally, a rush of dine-in business effects pizza brands negatively the same way stay-at-home trends (bad weather, mandates) buoy it. Data from The NPD Group show demand for quick-service delivery in general, not just pizza, declined in the high-single digits last year.

“As consumers returned to many of their pre-COVID eating habits, some of the sit-down business that was a source of volume for restaurant delivery orders returned to that channel,” CEO Russell Weiner told investors in February.

Since Domino’s business model is focused on carryout and delivery, the shift back to dine-in has bigger implications for the company compared to non-pizza restaurants that already offered sit down and carryout, but added delivery to their distribution channels during the pandemic, he said.

In addition, Domino’s is in the process of rolling a "Summer of Service" training program where all U.S. franchisees were invited to attend in Ann Arbor, Michigan, the chain's headquarters. Weiner called it was one of the largest system training efforts in Domino's history.

As Thomas-Moore noted, the move follows Domino’s decision to roll roughly hundreds of electric vehicles. In terms of technical innovation, in Q1 Domino's added in-car ordering through Apple CarPlay. Customers can either "tap to order," which lets guests submit a saved order, or "call to order," which allows them to place an order via a customer service representative.

Joe Jordan, president of U.S. and global services at Domino’s, told QSR the decision was “one answer to the delivery driver shortage” that came “by looking inside our own franchise operations.”

“After speaking to some of the franchisees who use their own fleet of vehicles, we found that they provide more opportunity to potential drivers who don’t have a car of their own. So, as a brand, we launched a fleet of more than 800 Chevy Bolt electric vehicles.”

The move, which gave Domino’s the country’s largest electric vehicle delivery fleet, provided several advantages for Domino’s stores, including ample battery life with the potential to have days of deliveries, zero tailpipe emissions, and lower average maintenance costs than nonelectric vehicles, without the financial impact of high gas prices.

In Q1, Domino's crossed 20,000 units globally, finishing at 20,008. That includes 6,708 in the U.S. and 13,300 internationally. Domestically, the brand opened a net of 22 restaurants in the quarter. Outside the U.S., a net of 106 locations debuted.