Domino's boosted by online demand
A pizza delivery chain today said that hungry customers used the internet and interactive television to order almost a million pizzas in 2005.
Domino’s Pizza customers spent almost £14m (€20.6m) on orders placed electronically last year – an increase of 70% on 2004 – as more than 10% of orders were made through computers or TV.
The trend helped Domino’s serve up a 27% rise in annual pre-tax profits to £11.2m (€16.4m) from its 407 UK and Ireland stores.
Electronic orders accounted for 12% of all its pizza orders in the first six weeks of 2006, and the company today looked towards continued sponsorship of The Simpsons and this summer’s football World Cup for further growth.
Around 94% of the electronic orders were made online via computer – with customers browsing a menu and placing their order which is then sent straight to the nearest branch for preparation and delivery. The rest were ordered with remote controls through interactive TV.
Chief executive Stephen Hemsley said electronic orders were on average 25% higher than those placed over the phone because customers could choose their food at leisure.
He predicted that by 2010 up to 35% of orders could be made electronically.
“It’s a very powerful tool which allows us to take an order accurately from a customer with virtually no intervention from the store,” he said.
“The benefit for us, especially if we can get to that 25% to 35% figure, is huge.”
Mr Hemsley said the targets were realistic because of the roll-out of higher speed broadband.
Interactive TV orders would not pick up until systems became quicker and “less clunky”, he said.
Domino’s like-for-like sales climbed 7.1% in 2005 and were up 10.3% in the first six weeks of 2006.
Total sales for 2005 climbed 15.1% to £200.7m (€294.8m).
The company, which launched its first UK store 20 years ago, opened 50 new outlets in 2005. It plans to have up to 1,000 outlets in the UK and Ireland within 10 years and already has firm plans where the next 400 to 500 stores will go.
The football World Cup in Germany is expected to be a boon for the firm as fans order pizzas to eat as they watch games. Mr Hemsley said early-evening kick-offs could boost sales by over 10%.
New products, including an Ay Carumba pizza based on the TV show it sponsors on Sky, The Simpsons, could also drive sales, the firm said.
Greg Feehely, an analyst at Altium Securities, said that the Domino’s store roll-out plan was feasible.
“With only 40% of households in the UK and Ireland currently able to access a Domino’s outlet, we believe this target should be achievable,” he said.
“The World Cup in June could once again provide a nice bonus.”
