Domino’s prepares for launch of loyalty scheme in the UK

Domino’s will roll out a loyalty scheme in the UK next year but CEO Andrew Rennie was keen to stress that it is not a silver bullet solution to driving purchase frequency for the brand.

Domino'sDomino’s is preparing to launch a loyalty scheme in the UK next year, with the pizza business confirming its ecommerce platform to enable the feature would be ready by the end of 2023.

Speaking to investors today (9 November), CEO Andrew Rennie did not confirm exactly when the loyalty programme would launch in 2024, but said the business will do “whatever [it] can” to drive consumer frequency.

This will “invariably” involve the loyalty scheme, he said. However, Rennie was keen to stress a loyalty programme would not be a silver bullet for driving more frequent consumer interaction.

“I don’t want to just jump into a loyalty programme because people expect it and think it’s going to change the world,” he said.

He warned that loyalty offerings can sometimes be used as “a short-term sugar rush” and that he was focused on long-term growth at the brand.

“We don’t want to rush it,” he said.

Promotions are a nice way to help the consumer and bring them to us, but they’re not the be all and end all.

Andrew Rennie, Domino’s

Rennie, who took over as Domino’s UK CEO in August this year, struck a more cautious note this quarter compared to the brand’s messaging a few months ago.

Speaking at the beginning of August, interim CEO Elias Diaz Sese told investors he was “very excited” by the potential of the loyalty scheme.

“We’re probably the only company in the industry right now that doesn’t have a strong loyalty programme,” he said, speaking to investors during the company’s half-year results.

He pointed to Domino’s US business, which increased its purchase frequency by 1.7 times in the first year after it implemented its own loyalty scheme.

While the brand’s new CEO stressed that the business’s focus on purchase frequency is not just about its planned loyalty programme, he did confirm the platform is “on-track” and ready to be completed.

The new ecommerce backend platform will introduce improved digital capabilities for the brand, allowing it more quickly install updates and enable agility across promotional and marketing activity.

This quarter, the brand saw success in its digital offering. It now has 8.7m active app users, a 55% increase versus the same period last year.

Broad-based focus

Rennie emphasised that he was taking a broad and long-term approach to driving growth at the business, he also stressed Domino’s should not be overly reliant on promotional activity.

“Promotions are a nice way to help the consumer and bring them to us, but they’re not the be all and end all,” he said.

He added his focus is on delivering “overall value” to consumers.

As well as driving frequency, reaching new customers is a key focus for the brand. Domino’s currently can reach around 85% of households in the UK, meaning there is plenty of room for the brand to reach new consumers, he said.

Stores in new locations have seen very high sales upon opening, he said, demonstrating how “people are calling out” for access to the brand.