Domino's is moving a lot of cheese on pizzas these days — thanks, in large part, to a partnership it has with the dairy industry.
In an exclusive interview with Dairy Herd Management on Tuesday, Domino's Vice President for Marketing and Retail Innovation Brandon Solano said the volume of cheese sold by his company was up 23% in 2010 compared to 2009.
The increase coincides with a revamped pizza recipe and increased emphasis on cheese.
In the past three years, Dairy Management Inc., which manages the national dairy checkoff program has worked in partnership with Domino's to improve the pizza category in general and Domino's pizzas in particular. Historically, pizza has accounted for about 25% of the cheese consumed in the U.S.
Over the past three years, DMI has spent approximately $30 million in partnership with Domino's. That money is leveraged with Domino's own marketing efforts to create the resulting sales increase.
"We spend in excess of $100 million a year on media," Solano said. "We have a lot of things we are advertising."
He said the company's carryout special, offering three-topping, large pizzas for $7.99 on Monday, Tuesday and Wednesday, would not have happened without DMI's financial assistance. So far, money from DMI has provided about one-third of the media marketing support for the carryout specials, he said.
He acknowledges that the $7.99 pizzas are sold at a deep discount, but it is worth it to their stores because enough extra pizzas are being sold. "It is a really thin margin for us, but with the DMI media support, we sold a lot of pizzas," he said.
Overall, dollar sales were up 9.9% for Domino's in 2010 compared to 2009.
Solano, who appears in some of Domino's television commercials, said the partnership with DMI has also been useful in improving the quality of the pizzas.
He cited one instance where the new product marketing staff and culinary staff from Domino's spent a week at the Center for Dairy Research in Madison, Wis., learning more about cheese and its various uses. The group also toured independent pizza restaurants in the Madison area to gain additional ideas.
From those initiatives, Domino's has decided to use specialty cheeses, like feta and Parmesan-Asiago, in its artisan pizza line. "You are not going to find feta cheese" in other national chain pizza restaurants, he pointed out.
The Wisconsin 6 Cheese pizza rolled out by Domino's earlier this year has 82% more cheese than its standard pizzas.
Solano says the partnership with DMI has been a huge success."Domino's pizza sales are very strong," he says. And, "our cheese volume growth is outpacing our sales growth."