retail sales occurred via its digital channel, and its loyalty program "Piece of the Pie" had 29 million active users, and 70 million customers enrolled. More than any other pizza chain, Domino's focuses on its digital ordering channels and loyalty rewards.
#DOMINOS TOPPINGS DRIVER#
Why Domino's delivery driver shortage might not matter In fact, the company ran a "Surprise Frees" ad campaign in 2021 that gave away $50 million in free food to its online-ordering customers as a way of highlighting the annoyance of surprise fees from third-party delivery apps.
The company won't turn to third-party delivery apps like DoorDash to UberEats to solve its biggest headache because management vehemently opposes them. Notably, the deal runs through May 22, perhaps signaling that the company expects its delivery driver problem to continue until at least then. The "carryout tips" promotion gives carryout customers who order online $3 toward their next order. For comparison, its smaller competitor Papa Johns (NASDAQ:PZZA) increased its revenue by more than 12%, from $469.8 million to $528.9 million, during the same time period.ĭomino's aims to ease its driver shortages by incentivizing customers to choose carryout over delivery. Still, the lackluster revenue growth looks even more mediocre knowing the company increased its prices by about 3% year over year. Management noted that its fiscal year 2020 contained a 53rd week, so revenues would have risen 6% year over year when factoring in the extra week.
Worse yet, management stated driver staffing "may remain a significant challenge in the near term" and admitted it's impeding its "franchisees' ability to take and service all of the orders coming into our stores" on its most recent earnings call.ĭomino's delivery driver shortage contributed to its total fourth-quarter revenue falling 1% year over year. Management blamed a tight labor market, rising wages, and the Omicron variant on its recent earnings call for the driver shortage.
#DOMINOS TOPPINGS DRIVERS#
However, the company can't find enough delivery drivers and that was before gas prices recently spiked to historic highs. No company knows that better than Domino's: Delivery makes up two-thirds of its sales. Let's face it: Americans love their pizza, particularly when it's delivered.
Driver shortages and surging gas prices don't mix While the company has implemented short-term measures to try to solve its biggest problem, here's why investors should be concerned that the world's largest pizza chain won't be able to turn around its struggling stock anytime soon. Recent events have left Domino's Pizza (NYSE:DPZ) struggling to deliver its pizzas to its customers.
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