Post on 15-Mar-2016
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POSTGRADUATE DIPLOMA IN BUSINESS
APMG 8119: DIGITAL ENTERPRISE
2014
Group: ISOTruong Dinh Thanh ThuValaphone SisouvongKounjairhtong Insiri
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Business Model Analysis
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Presentation outline
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1. Business background
2. Revenue analysis
3. Cost analysis
4. Value creation
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Domino’s Pizza Business Model
1. Business Background
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• Was owned by Domino’s Pizza Enterprises Ltd in 1960 with the purpose is “Fast free delivery”
• In 2003, open more stores in New Zealand.• Becomes the second largest pizza chain in
New Zealand in both network stores number and network sale
• In 1996, Domino Pizza was launched the Domino website: http://www.dominos.com/ which allows customers to book product online.
Partnership
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• Domino Pizza has created good relationship with their suppliers which will
- provide high quality ingredients: optimization motivation- Lower price: economic motivationÞ Reduce risk for product quality and price fluctuation• Domino Pizza use eco-efficient package and paper which are
friendly with environment => achieves acquisition of particular resources and activity
Customer Targeting
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• Pizza can be consumed by many people from different ages, genders, incomes and generations.
ÞDomino Pizza aims to serve for the whole market. • Domino Pizza continues to improve their menus
which are suitable for people from different religions => Domino can be easy to attract and serve different type of customers.
Online Retail Activities
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Offered both online booking through Domino’s website and Mobile Apps: HTML5 ordering system, iPhone App, Android App, iPad App, Desktop Ordering Site and Facebook Ordering with clear interfaces which make it easier for customers to order anytime in anywhere
Online Retail Activities
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• Domino Pizza entered into social network such as Facebook, YouTube and reached over one million fans on Facebook
• With the Facebook App, customers can rate their feedback => understand customer’s need to give better service
2. Revenues analysis: Products selling
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- •Price sensitivity•rivals•quality•services
+ •strong value-supply chain•menu creation•offer more menus•goes to marketspace
2. Revenues analysis: Stock shares – licensing
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- •rapid and unpredictable in the market•unaffordable licensing
+ •external investment•consistency operation under one license
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List 2013 ($’000) 2012 ($’000)
Revenue 188,631 169,466
Other revenue 106,259 96,421
Other gains and losses 3,564 3,161
Food and paper expenses 85,150 78,679
Employee benefits expense 76,260 65,264
Plant and equipment cost 9,331 8,588
Depreciation and amortization expense 12,792 10,029
Occupancy expense 9,103 7,837
Finance costs 405 451
Marketing expenses 11,430 11,477
Store related expenses 7,182 5,887
Communication expenses 6,351 6,669
Other expenses 39,685 35,523
Profit before tax 40,765 37,664
Income tax expense 12,108 10,708
Profit for the year from continuing operation 28,657 26,936
3. Cost analysis
3. Cost analysis: Food and paper expenses
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-• raising price of paper• ingredients• no standard
+• strong value-supply
chain reduce risk of price fluctuations
• never in shortage
3. Cost analysis: Employee benefit
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-• in some countries,
laws are strict, labor cost is high -> burden to business
+• (+) in some countries,
laws are not strict, minimum wage is low-> higher profit to business
3. Cost analysis: Resources structures
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Tangible
• physical stores• plants• equipments• employees
• investment
Intangible
• brand loyalty• licensing
4. Value creation (Organization perspective)
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• Desktop online ordering
• iPhone & iPad application, Android application, HTML5 ordering system, Facebook ordering page
• New design stores• Chef’s Best menu
• vouchers & coupons
• Cheaper everyday - $4.95
• eClub
• Pizza customization• Chicken, breads,
dessert, drinks
• Online order - save time & enhance productivity
• IT outsource - scalability & cost efficiency
Novelty Lock-in
Complement
a-ritiesEfficiency
Value creation (Customer perspective)
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Brand recognition • 2nd largest pizza chain in NZ• The largest franchisee in the world
Convenience & Accessability• Ordering system in all platforms
Customization•Customizing Pizza: crust, sauce, topping
Risk reduction• Pizza tracker
Price•Value pizza - $4.95•Coupons
Value creation (Social perspective)
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Partners foundation
Doughraiser Fundraisers
Natural Disaster Food Relief
Local sponsorship
Environmental friendly
Customer relationship
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24/7 social media
availability
Well-trained social media team
Real-time feedback
App
Thanks
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Amit, R., & Zott, C. (2001). Value creation in e-business. Strategic Management Journal, 22(6/7), 493. doi: 10.1002/smj.187
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References
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Domino's Pizza. (n.d-a). About Domino's. Retrieved from http://www.dominospizza.co.nz/corporate/about-dominos
Domino Pizza. (2013). People passion pizza. Retrieved from http://investors.dominos.co.uk/system/files/uploads/financialdocs/dominos_ar13.pdf
Gemmell, R. M., Boland, R. J., & Kolb, D. A. (2011). The social-cognitive dynamics of entrepreneurial ideation. . Entrepreneurship Theory and Practice(September), 1-21. doi: 10.1111/j.1540-6520.2011.00486.x
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References
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Microsoft. (2013). Domino’s Pizza. Retrieved from http://www.microsoft.com/casestudies/Case_Study_Detail.aspx?CaseStudyID=710000002307
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NZBusiness. (2014). Dominos shares social media tips. Retrieved from http://nzbusiness.co.nz/news/dominos-shares-social-media-tips
Pizza, D. s. (n.d-b). Community initiatives. Retrieved from http://www.dominospizza.co.nz/corporate/communityRayport, J. F., & Sviokla, J. J. (1994). Managing in the marketspace. Harvard Business Review, 72(6), 141-150. Statistics New Zealand. (2013). QuickStats about New Zealand. Retrieved from
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Touryalai, H. (2013). Technology, not pizza, helps Domino's crush competitors and grow faster than McDonald's overseas. Retrieved from http://www.forbes.com/sites/dalebuss/2013/05/01/with-dominos-live-test-pizza-chain-has-nothing-left-to-hide/
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References