The Unexpected Reason Domino's Takeout Sales Increased
Domino's takeout sales have continued to increase. Food Business News has reported that during a discussion about their second quarter results, Domino's reported their carryout sales grew by around 15%.
For many, this may be a strange turn of events for a company that focused so heavily on delivery. But part of it may be due to the promotion that gave each pick-up customer $3 towards their next meal. Domino's tried to frame this promotion as appreciation for the hard work of picking up a pizza. "As a reward, Domino's is giving a $3 tip to online carryout customers who take the time and energy out of their day to act as their own delivery drivers," Art D'Elia, Domino's executive president — chief marketing officer, said in a press release, via NBC10. "After all, we think they deserve it."
Obviously, a discount on future purchases will drive customers to adopt the habits that snag them those discounts. But there's more to the story when it comes to the increase in sales.
There is also a negative reason
The increase in pick-up reflects how Domino's have failed for a year to lure workers into their delivery driver positions. The difficulty is reflected in how many lawsuits Domino's has faced from their drivers. They uniformly argue that the company fails to reimburse their drivers for the gas, car insurance, and maintenance needed to complete the job (via Bradley Grombacher).
When NBC10 covered the customer tip promotion, it also noted that this occurred during a period in which Domino's was struggling to attract delivery drivers. Such speculation is supported by D'Elia's specific comment on how customers would act like delivery drivers. Moreover, Food Business News relays a similar comment made by Russell J. Weiner, chief executive officer and chief operating officer, during the conference call. "We continue to navigate the labor market in the U.S., especially for delivery drivers," he explained.
On the customer end, though, the lack of drivers means longer wait times. In July 2021, CNN reported that wait times were beginning to grow for Domino's. "We've slipped a minute or two," CEO Richard Allison admitted.
So, pick-up sales have picked up because Domino's has been unable to function according to its usual business model.