Key lessons startups can take from Domino’s Pizza’s massive foreign expansion

Not too long ago, US pizza chain Domino’s Pizza established a South African presence. To date, there are eleven stores spread across Cape Town, Gauteng and Durban, with plans to open even more in future. Success in this market is very lucrative — a Euromonitor report estimated that fast food sales in South Africa topped R24-billion in 2012.

A key to success for international brands entering new markets is a proper knowledge and deep understanding of the target market. Investing time and resources into understanding the local customs, preferences and tastes is often what separates the successful brands from the ones that fail to thrive in new markets, and enables those brands to connect with their customers in a meaningful way.

Dominos Pizza offered a case study in how to enter new markets effectively when they expanded into India. Realising that pizza is a cross-cultural food that is quite similar to traditional meals already prepared in the country, Domino’s was able to forge a well thought-out plan to fully localise its brand and meet the expectations of this market. The result? Dominos is India’s largest international foreign-food chain, twice as big as McDonald’s. Its 806 stores spread across 170 cities means the Indian market has become Domino’s largest source of revenue outside the US.

By researching local ingredients, finding ways to keep prices low, and accurately calculating delivery times, Domino’s could produce a constant stream of happy satisfied customers. It exceeded expectations in many respects, keeping the pizza chain on top of the Indian market despite the expansion plans of its competitors.

What lessons does Domino’s expansion into India offer other brands who wish to localise their offerings? Here are the top three picks:

1. Plan and execute accurately

Domino’s is a very large organisation with a value offering that doesn’t always speak for itself. Successful expansion depended largely on skilled project managers applying a disciplined process of planning and executing the agreed game plan.

Domino’s for example studied local neighbourhoods, streets and traffic patterns to map out the best possible delivery times in India, which enabled the company to deliver on its promise of 30-minutes-or-less delivery times. This type of insight is not possible without expert project managers.

2. Know your market

When entering new markets, you have to know and understand the people you wish to sell your product or service to.

Domino’s did an exemplary job: by researching local ingredients and finding not only the flavours that would appeal, but also ensuring the pizzas can be offered at cost-effective prices, they spoke directly to India’s budget-conscious consumer. Take the time to know your international customer and you’ll be able to develop products and services that address their unique needs.

3. Adapt your marketing strategy

Want success? Deliver the right message at the right time — and in the correct language — in order to grab the attention of your customers.

Domino’s researched its target audience well enough to know that a mix of hip Western culture and familiar Indian values in its marketing messages would resonate with Indian consumers and bear most fruit. Marketing and advertising efforts could speak directly to broad audiences and ensure the greatest measure of success.

Similarly, using native-speaking translators in a localisation project can offer the local context needed to create engaging foreign content and support international marketing efforts.

As the desire for global expansion rises, Domino’s has set a great example for companies that are just beginning their worldwide journey. By investing time in learning about their target audience — or partnering with experts who know each market inside and out — businesses will be better positioned for international success.

Image by Chuck Coker via Flickr