Disruptive Business Models: A Case Study of Dominos Pizza Inc.

A business model can be defined as the rationale of the way an organization creates and
delivers value, social and cultural context. The business model identifies sources of revenue and
the manner in which an organization shall be profitable. On the other hand, disruption can be
defined as disturbance, interruption or hindrance in a process or activity. According to de Jong &
van Dijk (2015), business models are under attack due to the rapid innovations and inventions.
The current business models are under extreme disruption and displacement. This essay shall
discuss the case of Dominos Pizza Inc. Dominos Pizza Enterprises Ltd is the largest chain for
pizza in Australiaa in terms of network sales and store numbers. Australia has the largest
franchisee for Dominos in the world. For examining the business model canvas by Osterwalder,
the value proposition, customers, finances and infrastructure shall be explained.
The existing business model for Dominos can be explained using Osterwalder and
Pigneur’s work and thesis. The following building blocks shall help in explaining the business
model of Dominos.
Key Activities
In the existing business model, Dominos conducts the most important activity of
delivering pizza in the least amount of time. However, due to the advances in technology, there
lie threats as Dominos is deviating from its core activity of making pizza and delivering it in the
least time to other activities such as building digital capabilities like mobile applications. The
digital advances may be an opportunity for the company to enhance its business network.
However, it may be a threat as the people are confused if Dominos is a restaurant chain or a tech
company.
Key Resources

The key resources may be defined as the assets available to an organization allowing to
run the operations effectively. Dominos has a large human workforce to handle the operations
and meet the consumer demands. Apart from human resources, the organization is backed by
physical and intellectual resources. With the advances in technology, Dominos is developing its
intellectual resources. However, the human resources are under threat as the main focus is
shifting from making the best pizza to developing and maintaining the best technological apps.
Key Partners
Dominos builds successful relationships with its partners. The journey of Dominos does
not stop with pizza, but they also intend to partner with companies and individuals across the
supply chain. Dominos is in partnership with Schweppes, JBS, Leprino Foods and various others
who provide the brand with the best produce, equipments, store and franchisees
(Dominos.com.au, 2018). The advancement in technology shall help in making the produce
better which opens a wide opportunity for Dominos in serving the best quality pizzas. Dominos
is in partnership with Apple where the Dominos Pizza Live Tracker app helps in knowing the
users the status of their order (Dominos.com.au, 2018).
Value Propositions
The value proposition is built to explain how the unique offer at Dominos shall
differentiate from its competitors. Dominos is developing applications and exploring the digital
world to enhance the overall customer experience. Dominos offers online ordering and tracking
system to enrich the customer experience. However, the price of products is increasing at
Dominos as the company is focusing on developing mobile applications and technology. It forms
a part of the organizational cost adding to newness thereby distinguishing from the competitors.

Customer Segments
For building an effective business model, multiple set of customer segments may be
determined. Dominos serves the mass market and has no specific segmentation. As Dominos is a
restaurant chain, it has a wide view of potential customers. However, with the advancement in
technology where the company is making major technological innovations, the customer
segment has increased opportunities. In 2013, Dominos made the use of Splunk Enterprise
software for boosting the operational and sales data. Moreover, the customer segment was
enhanced as the company also launched Pizza Profiles where the customers could reorder their
favourite combinations in five simple clicks.
Channels
The value proposition is delivered to the target customers using fast, cost effective and
efficient channels. An organization can reach its clients through multiple platforms through store
front, distributors or a combination of both. In the year 2015, Dominos launched DXP for
delivery driving experts. The pizzas could be kept warm with this technology thereby improving
the customer segment. However, it costs the company between $20,000 and $25,000 for each
franchise. For so many years, Dominos has been delivering the pizza to the customers who place
order online. The advancement in technology that led to creation of DXP is disrupting the
business model as the van has a capacity of 80 pizzas. It shall increase the cost of maintenance
and delivery for a few orders to be delivered.
Customer Relationships