Domino's Takes a Stand on Delivery Fees
If you were parked on your couch last weekend watching football, such as that amazing game between Auburn and Alabama, a TV ad from Domino's may have caught your eye.
The pizza giant took to the airwaves to educate consumers about third-party delivery fees and how they detract from local restaurants' bottom lines.
[75% of consumers prefer to order delivery direct from the restaurant, according to HT's 2021 Customer Engagement Technology Study.]
Plus, in the spot, Domino's shared what some of its stores are doing to help local -- and competing -- restaurants survive. In recent weeks four Domino's franchisees and one corporate-owned store have helped some beloved local establishments impacted by delivery fees.
$100,000 Giveaway
Participating Domino's stores across the Greater Boston, Phoenix, Louisville, Laredo and Denver areas bought thousands of $50 gift cards from local restaurants, randomly gave them out to Domino's delivery customers, and encouraged them to use the gift cards by ordering directly from the local restaurants so they could avoid delivery app fees. These local Domino's stores gave away more than $100,000 worth of gift cards from locally owned restaurants, taco places, barbeque joints, bakeries, delis and more, to roughly 2,600 customers throughout early November.
"Running a restaurant is tough. Our franchisees benefit from being part of a brand that has operations and technology built for delivery," said Russell Weiner, chief operating officer of Domino's. "However, many small restaurants don't have a system for delivery. Meanwhile, third-party delivery apps are charging local eateries high fees to deliver, which are taking away much of their earnings. Domino's and its franchisees were inspired to pay it forward in these communities by helping drive business to a few neighboring restaurants – without the substantial fees."
Delivery Fees
During the pandemic, more cities and states took aim at third-party delivery fees. Third-party delivery marketplaces provided increased reach and marketing power for brands big and small. However, third-party delivery fees were increasingly under fire as many restaurants, with dining rooms closed, depended on off-prem to survive. Chicago, Philadelphia, Portland, Ore., San Francisco, New York and Seattle were among the cities that moved in 2020 to cap third-party delivery fees, at least temporarily during the pandemic.
"We love that Domino's has supported other restaurants and driven their customers to these mom and pops that could really use the help," said Irene Li, owner of Mei Mei in Boston, Massachusetts.
Domino's message: if you're not getting Domino's, skip the delivery apps and order directly from a local restaurant. To hear from some of these small restaurant owners and learn more about Domino's surprise gift cards, click here.
While Domino's is the largest pizza company in the world, it is actually made up of stores owned by hundreds of independent franchise owners, with more than 95% of them starting as Domino's delivery drivers or pizza makers. They know how hard it is to run a business, and they see the impact that substantial fees from delivery app services have on small restaurants.