24 Aug Case Study – Mobile advertising
To measure the full value that mobile ads were bringing to the company, Domino’s Pizza optimised its campaigns and measured two new conversion types: app downloads and store locator clicks. With these seemingly small actions, the company tripled mobile conversions, reduced cost-per-conversion by over 50 percent, and accounted for 63 percent more revenue that had been driven by mobile ads.
Domino’s is a globally recognised leader in pizza delivery and the largest pizza chain in Australia and New Zealand with 580 stores in the two countries. Domino’s was early to recognise the potential for online ordering, and today, half of its sales are made online. With mobile now representing over half of online sales, this platform has become increasingly important for the company.
Group CEO Don Meij explains, “From a Domino’s perspective, the great thing about mobile is that it puts a pizza store in everybody’s pocket. So you can order a Domino’s pizza anywhere, anytime, anyplace on any kind of mobile smartphone device.”
To understand the total value of its mobile advertising efforts, Domino’s partnered with Google to examine mobile ad performance and quantify the impact of these ads.
Delivering quick optimisation wins
Domino’s marketers laid the groundwork for mobile ads success with some quick optimisation wins. First, they ensured that the company was advertising on all key brand terms on mobile. Next, they worked with Domino’s bids, raising mobile bid adjustments during mealtimes to increase exposure. Lastly, they used mobile specific ads to show Domino’s app extension ads to mobile searchers. Mobile specific ads allow advertisers to show mobile-optimised ad text and formats on mobile devices instead of desktop creatives. With the help of mobile-specific ads, Domino’s app downloads tripled. Overall, Domino’s also tripled its mobile conversions while reducing its cost per conversion by more than 50 percent.
Measuring new conversion types
In order to understand the full value of mobile for Domino’s, the company took a step back to rethink the way it evaluated its ad performance. In the past, Domino’s calculated the value of its mobile ads by analysing the revenue generated from Domino’s mobile website. However, a quick look at these numbers revealed a lower conversion rate and higher cost-per-conversion than Domino’s desktop campaigns.
Domino’s sensed that this narrow approach missed out on a larger part of the picture and partnered with Google to uncover the true value of its mobile advertising. The Domino’s marketers knew mobile devices had created new paths to conversion that were valuable to the business, so they began counting two new conversion types that were important the company: app downloads and store locator clicks.
For mobile store locator ads, the company estimated that 15 percent of people who clicked on a mobile store locator visited a store and made a purchase. By applying this percentage and multiplying it by the average order value in-store, Domino’s was able to calculate the return on investment for each paid store locator click.
Mobile as a recipe for success
According to Domino’s initial calculations that took into account mobile site revenue only, mobile cost per conversion was 50% higher than desktop. But, by using the existing base of revenue from the Domino’s mobile site, and then adding the revenue from app downloads and store locator clicks, Domino’s discovered that its revenue from mobile ads was 63 percent higher than previously calculated. The company’s mobile cost-per-conversion was also found to be more competitive than its desktop conversions.
For Group CEO Don Meij, the data was irrefutable. The message across the entire Domino’s organization is that mobile is a necessary investment and a core part of the company’s online advertising efforts. Meij says, “Without giving away all the sorts of things we’ll be doing, more and more of the way we operate our business will simply be mobile.”
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