Domino’s CDO Shares His Secret Sauce For Innovation

Domino’s is reaping the benefits of a digital first-mover mentality. But, according to CDO Dennis Maloney, innovation is about more than getting to market first.

Domino’s is reaping the benefits of a digital first-mover mentality. To its credit: It was the first pizza chain to debut an online pizza tracker and a voice-ordering app, to name just a few.

But, according to the company’s chief digital officer, innovation is about more than getting to market first.

“You need the right structure [for innovation],” said Dennis Maloney, CDO of Domino’s. “You need the right people, too. You also need executive support and a business model that can support that level of innovation.”

Domino’s wasn’t always a poster child for innovation, he told CMO.com. In fact, in 2010 the company was in quite a bit of trouble.

“Our value equation had gotten a little bit out of whack,” he admitted. “Customers looked at us for fast food, and they looked at us for cheap food. Unfortunately, they didn’t really look at the brand in the context of good food or even good food for the value.”

So that same year the brand launched a new and improved pizza, changing the crust, sauce, toppings, and cheese. It was a big shift—one that called for a new sort of marketing. The company took a direct approach and, as part of its “Oh Yes We Did” campaign, released a television spot that basically admitted to viewers that its pizza hadn’t been up to par.

https://www.youtube.com/embed/AH5R56jILag

According to Maloney, that tagline had as big of an effect on the company as it did on its consumers.

“From that point forward, a couple of things started to change,” he said. “One, I think we became a much more honest and transparent brand both to our consumers and internally. Two, we started asking ourselves: Is what we’re working on something that would make our customers stop and say, ‘Did Dominos really just do that?’”

People And Structure

Maloney credited most of the company’s innovation to the fact that it builds all of its own digital platforms. “We do almost all the work in-house,” Maloney said. “So all of the programming and all the technical aspects, our apps, a variety of our platforms, and any of the functionality we’re building—all of those folks are in-house.”

While IT works on the technology, Maloney said, marketing manages the digital experience. This structure makes marketing and IT alignment natural and organic, which is essential to digital innovation, he added.

“The connection between our IT organization and the marketing organization is probably the best relationship between any two groups in the entire company, which is a really unusual thing to say,” Maloney said. “Our organization’s structure ensures these two groups are working completely in lockstep.” They meet every two weeks to ensure that alignment remains strong, he said

Domino’s has also adopted agile methodologies from software development into its marketing and IT organizations. This has meant a shift in both mentality and process, Maloney said.

“We don’t want people to think about projects as long or drawn-out processes,” he explained. “You have to think about [breaking] things into really small, fast, evolving steps and processes and then working closely with the IT organization to make sure [everything] is working and playing out to what we would expect from a consumer experience standpoint.”

With even more experience, the company also began to leverage voice platforms, such as Amazon’s Alexa. Voice started as something more limited and became a more robust offering over time, Maloney explained.

Making The First Move

In 2013, Domino’s became one of the first companies to embed a fully integrated virtual voice assistant into its app. It also was one of the first companies to enable a true Twitter-ordering capability and to use emojis to trigger an order. Add to that the creation of an app that places an order upon launch, with no additional clicks required. Other innovations include pizza-delivery drones in New Zealand and augmented reality billboards that accept orders in the U.K.

These innovations aren’t just novel to the pizza or broader restaurant category. “There are things we’re doing now that are truly almost new to the world or are actually new-to-the-world innovations,” he said.

An example is the Dominos Experimental Prototype (“DXP”), a “purpose-built vehicle” launched in 2015. Today, the company has a fleet of 150 cars that come equipped with space for 80 pizzas, a warming station, and only one seat for the driver.

In partnership with Ford Motors, the company is also testing autonomous vehicles for pizza delivery.

Continuous Improvement

According to Maloney, Domino’s is “a brand in progress.” By that he means the company is never finished with its digital transformation and is continually experimenting to improve the pizza experience.

For example, in late 2010, Domino’s introduced its famous pizza tracker, which allows people to not just order and build their pizza online, but also to track the order in terms of where it is in the preparation and delivery process. But innovation didn’t end there.

“We are constantly looking for value in the undervalued parts of our experience,” Maloney said. “That started leading to things like our Easy Order. You set up an account to save a profile, which simplifies the number of clicks it takes to place an order. Up to that point, a standard order would be something like 25 or 27 clicks. We reduced it via easy order to about five, which was a significant friction reducer to the ordering process.”

This mindset of constant improvement has spurred much of the innovation at Domino’s. The company realized early on that it would need to move fast, which meant constantly learning, reiterating, relaunching, and testing all the time.

“We needed to become comfortable with failure because if you’re moving fast, not everything is going to be perfect,” he said. “You need to get very good at trying to figure out how to test things. It’s smaller tests instead of just launching stuff to figure out what’s happening. You also have to get really good at understanding data.”

Maloney advises brand marketers who aspire to be digital innovators to first focus on what defines them as a brand. Once that foundation is in place, then work on innovation that improves the experience, he said.