Domino’s Pizza, the leading food services brand in India managed by Jubilant FoodWorks Ltd (JFL), is actively addressing increased competition from upscale pizzerias and local pizza establishments. The company’s senior executives have expressed their commitment to intensify efforts and focus on expanding their business in response to the heightened competitive landscape.
The pizza franchise is introducing a variety of premium cheeses for its gourmet selection, along with novel toppings and sauces. Additionally, company executives announced on Tuesday that they are increasing the sampling of gourmet pizzas in the top-10 markets across the country.
“We are very happy with local pizzerias coming in – they are seeding the market and that’s good. We are in 400 cities. In other 600 cities, there are local players serving pizza,” JFL managing director Sameer Khetarpal said.
In response to increased competition at the regional level, Domino’s has begun to categorize toppings and varieties. For instance, they have introduced an all-vegetarian toppings segment in Gujarat, a region that has witnessed the emergence of nearly 90 new local players in the past year alone.
“In every city we go to , there is a local player which is serving pizza. What we are doing is bringing in international quality, delivered fast,” Khetarpal said.
Over the past year, increased competition has emerged from both gourmet chains and smaller, hyper-local, and regional players. Brands such as Tossin, Joey’s, Leo’s Pizzeria, and Ovenstory have gained market share in smaller, niche markets by exercising stringent cost control and focusing on limited but targeted marketing expenditures.
Khetarpal highlighted that in India, the consumption of pizza occurs three times a year, in contrast to the United States where it is consumed approximately 35 times annually. “So my challenge is to grow pizza as a category, not just compete with other pizza brands but also all other fast foods – whether western or Indian,” he said.
“When we go to a new city, we do see what the local choices are for customers,” he added.
Starting this week, Domino’s Pizza is launching a new campaign with new messaging aimed at Gen Z and millennials, integrated with new boxes, refreshed stores, outfits for delivery teams, and bikes for the delivery workforce.
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Sameer Batra, president and chief business officer of Domino’s India, said the chain is doubling down on gourmet pizzas. “Gourmet pizza consumption is happening in 12-15 pin codes in India only; for those pin codes we have launched new gourmet ranges, new types of cheese, changed toppings, special varieties of tomatoes and sauces,” Batra said.
JFL, holding franchise rights for Dunkin Donuts and Popeyes in India, recorded a 26% decrease in net profit to INR 97.20 crore for the quarter ending September 2023. However, there was a 5% growth in revenue, reaching INR 1,368.63 crore.
During the recent Global Investor Day meeting, Domino’s Pizza CEO Russell Weiner mentioned that the company has been successfully gaining market share from independent and regional pizza competitors. He highlighted India and China as key focal points for international growth in the coming year, projecting an increase in the number of stores in India to 3,000 by 2029, up from the current 1,961.
Acknowledging the rise of regional rivals across all its markets worldwide, Domino’s noted in its global presentation, “We will get more customers through a value strategy.”
In a statement, IIFL Securities observed that the pizza market is becoming increasingly crowded, with regional chains representing nearly 30% of all outlets. The report highlighted the notable expansion of home-grown brands such as La Pino’z, which have more than doubled their stores in the span of three years.