Sometimes an idea is so good, we just want to write about it. Domino’s Pizza “Points for Pies” is brilliant. With Points for Pies, Domino’s is offering people loyalty points for any Pizza, not just Domino’s.
They must be crazy right? Well hardly. It’s actually brilliant.
The promotion is simple. Download the Domino’s app. Using the app, scan a picture of any pizza. Frozen, take-out, Pizza Hut, whoever – and earn 10 points in Domino’s Piece of the Pie rewards program. 60 points earns you a free pie (from Domino’s of course).
Pizza is a category that dominated by high frequency purchasers – 43％ of Americans eat Pizza once a week. And for Domino’s, digital dominates. Last year over 60％ of Domino’s sales were from digital platforms. So Domino’s strategy is to win over high frequency customers, get them onto the Domino’s app and into Domino’s digital ecosystem. “Points for Pies” aligns perfectly with that strategy.
- It’s a conquest strategy to acquire non-customers and get them to put the Domino’s app on their phone
- It’s a nudge to get occasional customers who don’t use they app to download the Domino’s app and join the loyalty program
- For existing loyalty members, Domino’s is gathering insight about how much share Domino’s gets as well as when those members order from someone other than Domino’s
- It’s great messaging and PR: “We love pizza so much we are rewarding you even when you don’t order it from Domino’s.”
In doing the math, Points for Pies seems pretty cost effective:
60 points earns a medium 2 topping pizza ~$9. Hence, a point when redeemed is worth 15 cents ($9/60 points). Assuming that 60% of all points issued get redeemed; a point when issued, has an expected value of 10 cents. $9 Reward / 60 Points * 60% redemption = $.10 per point.
Thus the 10 points I earn for snapping a picture of a competitors pizza costs $1.
- $1 to acquire a new customer and get that customer to download the app and join the loyalty program
- $1 to get an existing customer who isn’t using the app to start using the app
- $1 to get insight about Domino’s share with a regular customer
That seems to be $1 very cost effectively spent.
In reading the terms and conditions of the promotion, Domino’s smartly fenced in the promotion, focused much of it on new customers and capped the cost.
At Sprocket, our point of view is that points are a nudge, a means to an end in the service of a broader strategy. When we see a great example in the marketplace we just have to give it a shout out. Well-played Domino’s.