Our Domino's SWOT analysis highlights some of the strengths, weaknesses, opportunities, and threats faced by the pizza brand.
Do we have any pizza lovers here? If yes, let me tell you that after reading today's article, you will be craving pizza. So, ordering a large pizza for yourself is highly advised before you start reading this article.
You must be thinking about what pizza has to do with this article. Well, today we are going to discuss one of the most popular pizza brands worldwide, Domino's!
If you are a pizza lover, Domino's should be your go-to place to buy pizza. No other brand can replace Domino's delicious pizza loaded with molten cheese and your favorite topping.
You probably do visit Domino's frequently. However, you might be unaware of the insights of the brand. So today, we have decided to conduct a Domino's SWOT analysis so that you get to know more about your favorite brand.
Before we head toward Domino's SWOT analysis, let's have a look at the history of Domino's. The foundations of Domino's were laid back in 1960 when two brothers named Tom and James bought the local Pizza restaurant in Ypsilanti, Michigan.
Initially, the pizza restaurant kept operating under its previous name. However, in 1965, one of Domino's employees suggested the name Domino's. From there onwards, the name Domino's was carried forward.
Domino's got famous quickly due to its delicious Pizzas and amazing service. The Pizza brand rapidly grew within the US. Besides the home country, Domino's also launched its operations abroad.
In 1983, Domino's opened its first restaurant outside the US in Canada and Australia. After six years, Domino's celebrated the launch of its 5,000th restaurant. The same year, Domino's introduced its first handmade pan pizza.
People were in love with Domino's by that time. After that, however, the Pizza chain decided to introduce its first-ever non-pizza product, the breadsticks, in 1992. After the success of the breadstick, Domino's introduced chicken Buffalo Wings on its menu, which were also loved by the customers.
Under the command of Tom, the founder of Domino's, the pizza chain achieved great success. It even established its 1,000th international Pizza restaurant. However, in the late 1990s, Tom retired.
The coming decades brought great success to Domino's. First, the pizza brand started the 21st century by getting listed on New York Stock Exchange. Then, in 2007, the brand innovated and launched its online and mobile ordering service. The following year, it also initiated an order-tracking mechanism that attracted a lot of customers.
In the coming years, Domino's worked significantly to adopt the latest technology to benefit its customers. For example, in 2013, Domino's upgraded its ordering system to record the order in about 30 seconds. This improved the service of the brand and increased its sales.
Besides that, In 2015, the brand designed a special pizza delivery vehicle with a warming oven and storage areas that facilitated the loading of pizzas and other products. The vehicle was designed to carry around 80 pizzas. Such innovation was one of a kind that helped Domino's in improving its service.
Domino's kept growing nationally and internationally due to its amazing taste, quick service, and openness to innovation. Currently, there are 18,848 Domino's restaurants worldwide. Due to such a high geographical presence, Domino's was able to generate revenue of $4.48 billion in 2021.
Now that you are aware of the history of Domino's and the current operations of the pizza brand, let's proceed further and carry out Domino's SWOT analysis. However, before proceeding to the SWOT analysis, you need to know what SWOT analysis is.
SWOT analysis is a business tool that highlights an organization's strengths, weaknesses, opportunities, and threats. A SWOT template identifies how various internal and external factors impact an organization.
To see how different internal and external factors affect Domino's, we will conduct a Domino's SWOT analysis now.
Strengths of Domino's
Strengths are the strong points that an organization has. Organizations strive hard to attain strengths since they help an organization solidify its market position. This section of the SWOT analysis will identify some of the strengths of Domino's.
Large Geographical Presence
Every organization looks forward to having a large geographical presence to target more customers and generate huge revenue. However, not all businesses manage to grow as big as Dominio's.
The pizza brand initially started off by offering Pizza to the people of the US only. However, as the brand gained popularity, it spread its operations abroad. As a result, Domino's started serving people out of the US in 1983 for the first time.
Currently, Domino's operates in more than 90 countries. Such vast brand operations help it target more customers and generate higher revenue.
Large Customer Base
Businesses desire to have a large customer base to generate more revenue. Domino's is one of the brands that have a huge customer base. The pizza brand has more than 1 million customers across the globe.
Due to such a large number of customers, Domino's can attain many sales yearly. In 2018, the pizza brand managed to sell 101.8 million pizzas. Imagine how much revenue it would have made just by selling pizzas. Having such a large customer base helps Domino's generate high revenue.
Healthier Alternatives In The Menu
Many people consider fast food unhealthy due to the abundance of fat used in it. Pizza is one of the fast foods considered highly unhealthy due to the amount of cheese used in it. Over the years, people have shifted towards a healthy lifestyle. As a result, they now avoid consuming fast food.
You must be thinking if people are abandoning fast food, why is Domino's growing every year? The answer to this question is simple. Domino's menu has changed over the years. The pizza brand anticipated the change in consumer preference timely and started adding healthier alternatives to its menu.
For example, Domino's added thin crust Pizzas with less cheese and veggie Pizzas. The introduction of these alternatives has helped the fast food brand in an era where people are abandoning fast food.
Weaknesses of Domino's
Every organization has some drawbacks that prevent it from achieving its true potential. These drawbacks are known as the weakness of an organization. Like any other brand, Domino's also possesses some weaknesses. Here are some of the weaknesses the pizza brand possesses.
Mainly Known For Pizza
Food brands try to add different food items to their menu to attract people with different tastes. Domino's has also introduced different food items over the years to attract people other than pizza lovers. However, Domino's couldn't get rid of the label of "pizza brand" ever.
This affected the sales of Domino's negatively since people always think of Domino's as a pizza serving restaurant only. This image of Domino's has limited its growth since it only targets a niche market.
Lawsuits
No matter how famous a brand is, if it gets involved in lawsuits and earns a bad name, people eventually leave it. Domino's is one of the brands that is really loved across the globe. However, it has been in the line of fire multiple times due to some of its actions.
In 2019, a visually challenged man filed a lawsuit against the pizza giant accusing Domino's that its website didn't cater to the visually challenged. Hence, he was unable to place his order. The man won that case against Domino's. This damaged the brand's reputation since it didn't meet special people's needs.
Besides that, another case was filed against Domino's in which the accuser claimed that Domino's exploited its delivery drivers by not paying them the minimum wage and not paying them enough for overtime. This damaged the reputation of Domino's among employees and customers.
High Reliance On Supply Chain For Revenue Generation
Food brands mainly rely on the sales of their restaurants to generate revenue. However, that's not the case with Domino's. Instead, the Pizza brand generates most of its revenue from the supply chain segment.
In 2021, Domino's generated almost half its revenue by selling supplies, equipment, and ingredients to its franchises. As a result, the brand needs to increase the revenue earned from its restaurants to decrease its reliance on the supply chain.
Opportunities For Domino's
Businesses always get opportunities to grow. However, they sometimes fail to grab these opportunities on time and then regret them. In this section, we will be highlighting the opportunities present for Domino's in the future.
Expanding The Operations To Developing Economies
Brands often think that the demand for their products would be high in developed economies. So, as a result, they focus on penetrating the developed economies. But, unfortunately, they don't realize the power of developing economies.
As changes are occurring in the global economy, the purchasing power of developing economies is increasing. As a result, Domino's has an opportunity to focus on expanding into developing economies. This will increase Domino's sales significantly and help the pizza brand to generate higher revenue.
Make Use of The Internet
The number of internet users is increasing daily. Brands have started making use of the internet to promote their products. There are 5.03 billion internet users, of which 4.7 billion people use social media.
It is predicted that by 2027, internet users will reach almost 6 billion. This daily increase in internet users acts as an opportunity for Domino's. If the brand uses the internet for marketing purposes effectively, it can increase its customer base significantly.
Initiate Drone Delivery
Customers like constant innovation from the brands they love. Domino's can also adopt the latest technology of delivery through drones. This will make Domino's one of the first restaurants to deliver orders through drones, providing it with a competitive edge.
Besides that, completing deliveries with the help of drones will help Domino's complete the orders in less time. So naturally, customers will love that, and more people will love to order from Domino's.
Threats Faced By Domino's
Every organization faces different threats from its external environment. This section will examine what threats Domino's has to deal with.
High Competition
Businesses always try to avoid competition since it lowers their profits. Moreover, due to the competition, many brands are also driven out of the market.
Over the years, many fast food chains have entered the market, due to which the competition in the fast food industry has increased. For example, back in the 60s, when Domino's started operating, it was one of the few pizza outlets in the industry. Currently, thousands of Pizza selling brands compete with Domino's.
Changing Consumer Preferences
Over the years, we have seen consumers' tastes and preferences change. For example, if we talk about fast food, people used to love it a few decades back. They do love it even now, but now people are more health conscious.
People nowadays are shifting to a healthy lifestyle which prevents people from eating pizza. If people start abandoning pizza and other fast-food items that Domino's offers, this will impact the sales of Domino's adversely.
Global Recession
Currently, the world is on the verge of a global recession due to the post-math of COVID-19 and the war between Russia and Ukraine. If a recession occurs, the purchasing power of people will decrease significantly, and the sales of Domino's will drop.
The pizza brand will observe low sales, and as a result, its revenue will fall. It will be challenging for Domino's to deal with such circumstances.
Domino's SWOT Analysis: Final Word
Domino's is a pizza chain that is loved by people all over the world. So, looking at the popularity of Domino's, today we decided to conduct a Domino's SWOT analysis.
In this article, first, we discussed the brand's history and current operation. Then we proceeded further to carry out Domino's SWOT analysis. The SWOT analysis highlighted some of the strengths, weaknesses, opportunities, and threats faced by the pizza brand.
This article contained the results of the SWOT analysis in essay form. However, these results can also be represented in a SWOT Matrix. At the end of this article, we hope that you will have enjoyed this article thoroughly. We assume that besides getting insights of Domino's, this article has also taught you how to conduct a SWOT analysis. If you still feel a bit confused, look at some other SWOT examples to better understand the technique.
