Did Alexa Just Deliver Break-out Earnings for Dominos?
Domino’s is famous for being one of the early custom skills for Amazon Alexa and maybe the first that directly involved a commercial transaction. Many companies look at new technologies like voice assistants as a novelty. They want to be part of the news cycle so they participate on some public way and then move on to refocus on the practices that traditionally made their business successful. But sometimes, new technologies deliver returns early for those that take them seriously. Domino’s CEO Patrick Doyle puts Amazon Alexa in that category.
Be Where the Consumers Are Spending Time
Domino’s goes well beyond most advertisers’ definition of omni-channel marketing and Alexa is just one of its digital channels. Google Home, Facebook Messenger, Twitter, Smart Watches and TVs are also part of the strategy. Mr. Doyle commented in his interview with CNBC’s Jim Cramer:
We look at our ability to reach our customers and those are the platforms where they are spending time. They’re on Alexa. They’re on Google Home. They are using their iPhones to order. They ordering through Facebook Messenger.
CNBC reported that Domino’s brought in a sharp increase in fourth quarter sales that was much better than competitors and surprised analysts. The highlight was a 12.2% increase in same store sales. CNBC’s Abigail Stevenson wrote:
Customers can order with an Apple watch, Facebook messenger, Alexa and Google Home. The platform also allows them to track their pizza from the store to their door. It’s even rolling out an autonomous delivery vehicle called “DRU”.
The Street came to a similar conclusion after the Domino’s analyst earnings call last week. Lindsay Rittenhouse reported:
On an earnings call this morning, Domino’s CEO Patrick Doyle said its same-stores sales increase can be attributed to its unmatched digital growth, plus a record opening of restaurants.
A Wake Up Call for Consumer Brands
Amazon recently announced that there are now more than 10,000 skills for the Alexa voice assistant. However, very few consumer brands are using this new channel to reach consumers. Fewer still are using Alexa for commerce. When you ask Alexa or Google Home about brands you are more likely to hear a Wikipedia-style definition or that the assistant doesn’t understand the question than to start up a robust consumer experience. This is a mistake.
Many brands regretted waiting too long to establish a web presence in the 1990s and they are making a similar mistake today. Domino’s is a leader in the industry. Its earnings surprise and acknowledgement of Alexa’s role should be a wake-up call for the type of impact voice assistants can have for consumer brands that take the technology seriously.