Domino’s Revives Carryout ‘Tips’ to Save Itself and Customers Money

Domino’s is “tipping” self-pickup customers again to meet the cost-saving needs of business and consumer.

The quick-service restaurant (QSR) chain, which has nearly 20,000 locations around the world, announced Monday (Dec. 12) the return of its promotion to offer $3 credits for ordering carryout, a “tip” for their labor going to and from the store, the way consumers tip delivery drivers.

“We know the effort it takes to get up and leave the house in pursuit of a hot, delicious carryout pizza,” Christopher Thomas-Moore, senior vice president of customer and store experience at the restaurant, said in a statement. “We hope they take advantage of [this credit].”

The initiative, a revival of a promotion first launched nearly a year ago, is part of an overarching effort on Domino’s part to shift its mix toward pickup channels with the intention of boosting margins and improving efficiency. These attempts are proving successful. On an earnings call in October, the QSR chain shared that carryout same-store sales grew 20% year over year in the quarter. Plus, these sales were up 55% relative to Q3 2019.

Across the industry, brands are looking to drive adoption of their pickup channels in a bid to retain their customers at a time when many price-conscious consumers are cutting back on their delivery spending. Findings from the August edition of PYMNTS’ Consumer Inflation Sentiment study, “Consumer Inflation Sentiment: Inflation Slowly Ebbs, but Consumer Outlook Remains Gloomy,” revealed that 86% of consumers have made changes to their restaurant spending in response to rising prices.

In an interview earlier in the year PYMNTS, David Bloom, chief development and operating officer of fast-casual sandwich chain Capriotti’s and its subsidiary, Wing Zone, noted that brands have been emphasizing pickup in their marketing.

“That’s still the most quote-unquote ‘cost efficient’ because there’s no delivery fees and those types of things,” he said. “So, we’re making sure that people understand that, and we’re highlighting that to give people a choice.”

Overall, pickup channels tend to be more popular than delivery, and they are all the more so in this time of inflation. Research from the October edition of PYMNTS’ Restaurant Digital Divide report, “The 2022 Restaurant Digital Divide: Restaurant Apps and Websites in the Spotlight,” which drew from a survey of nearly 2,000 U.S. consumers, found that 25% of restaurant customers placed at least a quarter of their orders for delivery each month. Meanwhile, a far greater 60% placed at least a quarter of their orders for pickup each month, with the vast majority of those doing so for more than half of their restaurant orders.

Yet while the shift toward pickup channels may help ease the cost of labor for restaurants, it can make these same staffing challenges more apparent to consumers. The October study found that 71% of consumers who typically order restaurant meals for pickup agree that the restaurants they visit have become increasingly understaffed. This share exceeds that of any other ordering channel, with 64% of delivery customers saying the same.