David Brandon has a bit of a dilemma.
When the economy is bad, people spend less. When they spend less, they don’t eat out or order their dinners in as often.
When your company is built on a foundation of delivering ready-made food to the doorsteps of your customers, it’s a problem that hits you right where it hurts.
And that’s exactly what Brandon, Domino’s Pizza Inc. chairman and CEO, has been facing as the economy has slumped over the past year or so.
“We are very much a business focused on the dinner day part,” Brandon says. “Our peak consumption periods are right around the dinner hour. So, our category — and not just Domino’s, but everyone who participates in the pizza category — has been under a fair amount of traffic pressure over the past couple of years, as a result of the fact that people are cutting back their spending.”
One of Brandon’s solutions was to get creative. With dinnertime sales lagging as more and more families opted for home cooking instead of ordering out, Brandon and his leadership team made the decision to carve a presence with the lunchtime crowd.
Domino’s rolled out a line of baked sandwiches, which use some of the same ingredients as the company’s pizza products and can be prepared in pizza ovens. Throwing all of its clout behind the idea, Domino’s — a company that had $1.43 billion in 2008 revenue —quickly became the largest sandwich delivery company in the United States.
“The idea of expanding our menu to participate in the lunch day part and expand the menu with other items that are consistent with what our brand stands for while still offering more variety, for us, seemed to be a very good strategy to combat the fact that our core category is under some pressure,” Brandon says.
Creativity is great, particularly when you can find new ways to leverage the tools already at your disposal. But the ability to weather the nation’s economic slump is also rooted in common sense and adhering to solid business practices. Brandon has been able to do both, and Domino’s had maintained its standing as one of the pillars of the pizza industry.
