How Domino’s Used Voice-of-the-Customer Optimization to Conquer the Globe

Spoiler alert: #VOCO harnesses action-orientation around feedback, and in turn, gives your customers what they truly want.

The year is 1963 and brothers Tom and James Monaghan officially take over the operations of DomiNick’s, a small pizza restaurant in Ypsilanti, Michigan.

However, James didn’t want to quit his full-time job at the postal office, so Tom moves forward as the solo owner.

Over the next two years, Tom would purchase two more shops in the county, and to ensure they all maintained the same brand, he transitions the DomiNick’s name to Domino’s.

Fun Fact: the Domino’s logo that has carried through to 2019 carries three dots: one for each of the three original locations.

Over the next few decades, Domino’s experiences significant growth. They surpass one hundred stores. Then one thousand. They expand to new states. To new countries. To new continents. Then, in 1998, Tom decides to cash out. In 1998, Tom Monaghan announces his retirement and sells 93% of the company to Bain Capital for a smooth $1 BILLION.

What can go wrong?

Well, everything. Bain Capital successfully brings Domino’s to an IPO of $14 in 2004, but they fall slightly short of their target ($15–17). Then, over the next five years, their stock and the general public perception plummets. Shares fall to under $3 and in a survey rating national food chains, Domino’s comes in dead last.

Well technically, they are tied dead last with Chuck E Cheese’s — but you get the point. They are the worst tasting food in the United States.

So how does Domino’s dig themselves out of this hole?

In 2010, they turn to new leadership. Patrick Doyle is installed as the new CEO, and he embraces this interesting concept: he claims the customer experience will be at the center of their turnaround. In Patrick Doyle’s eyes, a renewed focus on the customer experience will be their core strategy moving forward.

So what does this look like?

First, Domino’s puts a spotlight on their terrible feedback.

An ad campaign is launched that shows the audience the real — and brutal —comments they received in focus groups. Cardboard crust. Bland taste. It’s recorded and shown to the world in a national commercial campaign.

The Washington Post calls this the “most elaborate mea cupla ad in history”. And it lands.

Second, the full Domino’s team is given full autonomy to do the right thing in the eyes of their customers.

So whether you work at the corporate office, own a franchise, manage a shift, or answer phones part-time on weekends, you are empowered to take matters into your own hands to delight unhappy customers. No managerial approval is needed, which means the time it takes to delight a customer is expedited.

Miss an item from an order? Was the delivery late? It doesn’t matter: you can solve for the customer.

Third, Domino’s took a step back from their “core product” and invested in the full customer experience.

Yes, “pizza” is their product, but the Domino’s “experience” starts at your order process, the wait for delivery, your interaction with the delivery person, and then the taste itself.

So beyond crafting a new pizza recipe, Domino’s invested heavily in technology across that full experience. Users can order online, through a mobile app, and with emojis on Twitter. Once ordered, you can now track the status of your food with the “Delivery Tracker”. You know who took your order, who put your food in the oven, and who’s driving the car to your house.

The delivery vehicles themselves also got makeovers to keep your pizza hot and ready to eat.

And lastly, Domino’s put an eye on all key metrics pertinent to their business.

In each location globally, a monitor details all key stats in real time. Weekly customer counts, average amount spent per order, and how each franchise ranks compared to other stores are all visible for all team members.

It’s not just a focus on key metrics: it’s transparency and visibility for all employees to see.

You can either use negative comments to get you down or you can use them
to excite you and energize your process to make a better pizza. — Patrick Doyle

So how’d it go? Well less than a decade later, Domino’s has 14,000+ locations globally, which means they have overtaken Pizza Hut as the largest pizza chain in the world. The stock is now over $290 a share.

To put this growth into perspective, compare Domino’s change in stock price compared to the FAANG stocks, which is an acronym for the market’s most popular tech stocks (Facebook, Apple, Amazon, Netflix, and Google):

source: recode.net

And for a more drastic comparison, compare that growth to Domino’s competitors, including Papa John’s, Yum! Brands, and McDonalds:

source: recode.net

1400% growth in the ten years since Patrick Doyle embraced the customer experience. So what does this tell us?

First, companies need to build a Voice-of-the-Customer, or VoC, program.

VoC: the process of listening to customer feedback about their experience using a product or service, including their expectations, preferences, aversions, and overall satisfaction; it typically consists of both qualitative and quantitative data.

Without listening to your customers, you’ll have no true understanding of how they feel about your company.

But to take it one step further, it’s not just about listening to customers. It’s about doing something. That’s where Voice-of-the-Customer Optimization, or VOCO, comes in.

VOCO: the involved process of listening to customer feedback, sharing the results within an organization, interpreting feedback for themes, and leveraging it to develop and implement appropriate action plans to facilitate organizational improvement.

So whereas VoC makes you aware of what your customers want and how they feel, VOCO gives your customers what they want and turns them into loyal customers.

Listening to customers call your crust cardboard won’t spark 1400% growth. Putting a spotlight on that feedback, empowering your team members to improve your processes, embracing the full customer experience, and monitoring key metrics will.

If you’re in the business of growing better, which I’d imagine we all are, consider #VOCO. Put action-orientation around the feedback you source from customers, and soon, you’ll #GrowBetter.