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Capturing a Bigger Slice of the Pie The pizza delivery business is very competitive, with both local businesses and national chains competing for a $28

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Capturing a Bigger Slice of the Pie

The pizza delivery business is very competitive, with both local businesses and national chains competing for a $28.5 billion U.S. consumer market annually. Many of the delivery pizzas ordered in the United States each year are purchased by young adults and teenagers. Papa John’s, a 2,700-unit national pizza restaurant chain, believed it could capture more market share if it could find a way to make ordering and delivery easier and more appealing to the technologically savvy members of the younger segment. And if it could do so, it could compete more effectively with larger national companies such as Pizza Hut and Domino’s. In early 2008, Papa John’s introduced a new marketing and ordering channel designed to attract younger consumers, rolling out a new service so customers could order pizza from a cell phone or PDA via text message. Once a customer first established an online account, they could at any time simply tap in their preference for one of several favorite pizzas using an abbreviated code. The meal order would be delivered to any of several preprogrammed delivery addresses, and paid for with credit or debit card information already on file in a database, and delivered within a half hour from the closest retail location.

Key additional benefits of customers’ willingness to opt into this unique channel arrangement are better overall marketing and customer awareness. By keeping a database of customer purchase behavior, customized promotions flow through the channel to pizza lovers, with great deals offered on favorite crusts, meats, and other toppings according to customer’s past preferences. The electronic channel can also be engaged in other ways, such as sending customers digital coupons, providing updates on new menu items, and engaging customers with reminder advertising. The results of employing this exciting new marketing and delivery channel have been impressive, with Papa John’s share rising to 6.9 percent of the marketplace despite having far fewer locations than their major competitors. The company has also recently introduced Web site ordering to great success, with 65 million unique visitors in the first year of operations. The company is optimistic that these new channels will allow it to continue to compete strongly with the “big boys” in the world of pizza delivery.

Q.no 1. What marketing channels were used by Papa John’s?

Q.no 2. What were the benefits of introducing new marketing channels to the company?

Q.no 3. What other marketing gains were achieved by these channels?

Q.no 4. Why digital marketing and digital ordering is significant for marketers in this age?