tag:theconversation.com,2011:/fr/topics/dominos-23919/articlesDomino's – The Conversation2017-09-14T22:34:30Ztag:theconversation.com,2011:article/839322017-09-14T22:34:30Z2017-09-14T22:34:30ZPizza delivery by robot cars has arrived with big questions<figure><img src="https://images.theconversation.com/files/186069/original/file-20170914-9029-zd94o5.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=496&fit=clip" /><figcaption><span class="caption">Ford and Dominos have teamed up to deliver pizza by driverless cars in a public test in Michigan. </span> <span class="attribution"><span class="source">Handout</span></span></figcaption></figure><p>People in Ann Arbor, Mich., are experiencing <a href="http://www.freep.com/story/money/cars/ford/2017/08/29/dominos-ford-self-driving-cars-ann-arbor/597329001/">home food-delivery without a driver.</a> </p>
<p>Domino’s Pizza and Ford have paired up in a pilot project that will look at how humans interact with driverless food-delivery cars. Ann Arbor is home to thousands of students, an age group not likely to view this new technology with suspicion. But it could turn into a <a href="https://www.wired.com/story/ford-self-driving-pizza-delivery-dominos/">fascinating social experiment</a> for the food industry.</p>
<p>Customers ordering through Domino’s will be able to track their delivery in real time by using a downloadable app on their smartphones. They receive a text message that gives them a four-digit code to use once the car arrives. </p>
<p>But it’s the final portion of the drive that could prove unpredictable for Domino’s. The driverless delivery vehicle could end up in the driveway, or near the curb. Customers may not want to go out to the car if it’s raining or snowing. Domino’s USA president Russell Weiner says these challenges are a major part of the experiment.</p>
<p>“We’re interested to learn what people think about this type of delivery,” <a href="https://www.theverge.com/2017/8/29/16213544/dominos-ford-pizza-self-driving-car">he said in a recent statement.</a> “The majority of our questions are about the last 50 feet of the delivery experience.”</p>
<h2>No tipping attractive to students</h2>
<p>Human behaviour can be difficult to predict at the best of times, especially when dealing with food. This will be the first time a food service or retail company has used driverless cars to interact with actual consumers.</p>
<p>The experience will certainly offer convenience for customers in a variety of ways. With the app, expectations will be managed, and quality of service — Domino’s key strategic focus — will be more consistent. </p>
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<figcaption>
<span class="caption">People can track their driverless pizza delivery with a smartphone app.</span>
<span class="attribution"><span class="source">Handout</span></span>
</figcaption>
</figure>
<p>That’s because delivery times will be streamlined, fewer pizzas will be damaged in handling mishaps and the customer won’t have to deal with tips — at least not for now. No tipping will reduce price points, making delivered pizzas more affordable. For cash-strapped students, that’s key.</p>
<p>For Domino’s, the business case for a driverless fleet is unquestionably strong. Lower insurance costs, lower fuel consumption, consistent delivery times, no thefts, controllable temperatures to keep food safe for customers so therefore less waste — the list goes on. </p>
<p>Domino’s delivers more than a billion pizzas annually, and has more than 100,000 drivers. Running a driverless fleet could save the company millions. </p>
<p>Embracing the concept of <a href="https://www.recode.net/2017/1/18/14306674/starship-robot-food-delivery-washington-dc-silicon-valley">home food deliveries without having to hire drivers</a> cannot come soon enough for the food service industry, which is looking for ways to increase revenue beyond their regular foot traffic. </p>
<p>Restaurant operators won’t need to deal with the headache of hiring the right people for delivery, and delivery is an important means of expanding the brand outside their facilities.</p>
<h2>Home delivery can be dicey</h2>
<p>Most of us who have ordered home-delivered food have had mixed experiences. </p>
<p>Some drivers make convicted felons look like choir boys, causing customers to be hesitant about the food. But home delivery is no walk in the park for the drivers, either. </p>
<p><a href="https://www.thrillist.com/eat/nation/pizza-delivery-horror-stories-delivery-drivers-reveal-naked-truths">Drivers in the U.S. have told</a> of finding themselves in unbelievably <a href="http://mashable.com/2017/08/03/deliveroo-awkward-experiences/#6alVgiJeHmqp">awkward situations,</a> including being tipped with weed, being asked to eat with the customer to offer company, showing up during domestic disputes and being greeted by a naked customer as the front door opens.</p>
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<figcaption>
<span class="caption">Domino’s and Ford are testing whether people will go to the driveway or curb to get their pizza.</span>
<span class="attribution"><span class="source">Handout</span></span>
</figcaption>
</figure>
<p>There’s an endless list of unpleasant scenarios that would discourage anyone from contemplating home food delivery as a full-time job or even part-time job.</p>
<p>A humanless home food delivery experience, on the other hand, also offers a unique perspective on the market currency of convenience. </p>
<p>For years, price has been king. In study after study, price has trumped any other feature consumers were looking for in food service. </p>
<h2>Consumers crave convenience and privacy</h2>
<p>Younger generations, however, have a different take on convenience. Price remains a significant factor for higher revenues of course, but the constant quest for more convenience on both sides of the food continuum is now reaching the point of obsession. </p>
<p>Getting rid of delivery personnel is now a realistic approach. With driverless home food delivery, one could potentially get food delivered without seeing a single human being — a frightening thought for some, a reassuring one for others. </p>
<p>In the future, consumers could binge on their favourite junk food several times a week without the embarrassment of seeing the same delivery person.</p>
<p>No matter how you look at it, Domino’s and Ford are onto something. After all, driverless technologies are consistent with what Domino’s is all about. </p>
<p>The company has been successful over the years with its mastery of home delivery. Joining forces with Ford could make the company even more efficient.</p>
<p>Nonetheless not all of us needs Domino’s to get our food fix. Divorcing the human aspect from food is simply impossible for many food service companies — thousands of them, in fact. And thank goodness for that.</p><img src="https://counter.theconversation.com/content/83932/count.gif" alt="The Conversation" width="1" height="1" />
<p class="fine-print"><em><span>Sylvain Charlebois does not work for, consult, own shares in or receive funding from any company or organisation that would benefit from this article, and has disclosed no relevant affiliations beyond their academic appointment.</span></em></p>Domino’s Pizza and Ford have teamed up to offer pizza delivery via driverless cars in Michigan. Is it the way of the future?Sylvain Charlebois, Professor in Food Distribution and Policy, Dalhousie UniversityLicensed as Creative Commons – attribution, no derivatives.tag:theconversation.com,2011:article/728442017-03-06T19:24:42Z2017-03-06T19:24:42ZCompany results: how competition is transforming Australia’s retail sector<figure><img src="https://images.theconversation.com/files/158405/original/image-20170225-22981-ucf0nc.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=496&fit=clip" /><figcaption><span class="caption">Aldi's decidedly Germanic expansion strategy continues to eat into Woolworths’ earnings.</span> <span class="attribution"><span class="source">AAP/Lukas Coch</span></span></figcaption></figure><p>Several pressures are emerging in the Australian economy that are making business competition more unpredictable and challenging. Three examples in the retail sector, as evidenced by recent half-year financial results, are the emergence of new competitors, Australia’s changing tastes, and disruptive technologies.</p>
<h2>More investment extending overcapacity?</h2>
<p>Incumbent firms, when confronted by agile new entrants, face some tough choices. In some respects the best way to counter new entrants with better business models is to change and expand the way you operate. For myriad reasons, this is usually impossible.</p>
<p>What firms generally do is try to replicate the new entrants’ approaches within their own business. Qantas pulled this off fairly well with Jetstar: it built a low-cost airline to counter Virgin’s emergence in Australia. But large grocery retailers Coles and Woolworths, facing a similar threat in their sector, are struggling to counter the threat posed by new entrants.</p>
<p>One of these new entrants is Aldi. Its decidedly Germanic expansion strategy continues to eat into Woolworths’ earnings. <a href="http://www.woolworthsgroup.com.au/icms_docs/186045_half-year-results-announcement.pdf">In Woolworths’</a> near-A$19 billion food business, sales were up by more than A$500 million while earnings declined by around A$130 million in the half-year to December 31, 2016.</p>
<p>One interesting statistic in Woolworths’ results was the decline in sales per square metre for the Australian food division from A$16,251 to A$15,927. This is a decline of just over 2%.</p>
<p>In the context of higher real sales numbers, this shows Woolworths is growing its retail space quickly. There’s evidence of this by the growing number of smaller inner-city stores, and new stores in the capital cities’ urban fringes.</p>
<p>This can be contrasted with Aldi’s smaller stores and relatedly simpler and more agile logistics arrangements. This particular measure shows how Woolworths’ legacy store structures and leases continue to hold back any fundamental turnaround in profitability – and why perhaps Woolworths’ landlords should be worried.</p>
<p>The conundrum for the likes of Woolworths, Metcash (supplier to IGAs) and Coles is that they are driven to lease new, generally smaller-format, stores to retain customer patronage, but moving out of their older sites is rarely feasible. As such, by trying to refresh their retail locations they are also adding more and more floorspace to a business where floorspace is driving less in sales.</p>
<p>The problem is that Woolworths is adding more retail capacity to a sector that is approaching saturation, with a rapidly growing competitor in Aldi. As such costs are increasing and margins are declining. </p>
<p>This is a classic economic imbroglio: firms see such innovative expansions as a means to solve their problems, but in many ways it makes those problems worse.</p>
<h2>Changing tastes upend value chain arrangements</h2>
<p>There is more to the story of a tougher retail environment than Aldi. Changes in what Australians are buying at the checkout is impacting supply chain arrangements significantly, and tilting profits to producers of higher quality and more healthy foods – and away from retailers. </p>
<p>As our national average girth expands, there is evidence that Australians are starting to change their ways in relation to heavily sugared grocery mainstays like soft drinks, sweet biscuits and the like.</p>
<p>This is evidenced by <a href="http://www.asx.com.au/asxpdf/20170222/pdf/43g5vs32tdr8sy.pdf">Coca-Cola Amatil’s tough result</a>. Its sales volumes were down by 2.1%, while revenues were down by 3.4%. This shows Australians are drinking less and paying less for their products. The squeeze was more acute for “sparkling beverages”: its volumes were down 4.7%.</p>
<p>While better-quality and healthier food is great news for Australia’s health, it is not so great for our grocery retailers. The decline of high volume consumer staples like chips and soft drinks is bad news for retailers, which use such products to draw in customers. This means retailers have to be more cost competitive and margin-sensitive across the complete business, not just in the drawcard products.</p>
<p>The flipside of this can be seen in the listed fruit-and-vegetable producer Costa Group, Australia’s largest grower and packer of fresh fruit and vegetables. <a href="http://investors.costagroup.com.au/Investor-Centre/?page=asx-announcements">Its results</a> showed sales up by 9% and earnings up by 26.6% year on year.</p>
<p>Since its listing in 2015, Costa’s share price has increased from A$2.25 to more than A$3.50. Its stronger margins since listing is a sure sign that, as a supplier to grocers, it is getting a stronger share of the food value chain – at the supermarkets’ expense.</p>
<h2>Innovation is disrupting business models</h2>
<p>Technological innovation <a href="https://en.wikipedia.org/wiki/Joseph_Schumpeter">drives waves</a> of creative destruction in economies allowing firms to continually revolutionise and competitively recreate themselves. Economist Joseph Schumpeter noted that economies progress through such innovation, albeit at the expense of firms left behind by the new innovators.</p>
<p>This is nowhere better illustrated than among Australia’s pizza retailers, where <a href="http://www.asx.com.au/asxpdf/20170215/pdf/43g0bb360j4z9z.pdf">Domino’s</a> ascendancy is close to complete. In its recent <a href="http://www.asx.com.au/asxpdf/20170215/pdf/43g0bb360j4z9z.pdf">results</a>, profits were up by more than 30% year-on-year. </p>
<p>As a retailer, Domino’s has taken command of its market segment through innovation, IT development and marketing in an unprecedented manner.</p>
<p>Illustrative of this is <a href="http://www.smh.com.au/business/retail/dominos-pizza-enterprise-is-set-on-a-3minute-pizza-and-2000-new-stores-20160404-gnye7k.html">its 3/10 project</a>, which aims to have pizzas for pickup available in three minutes or home-delivered in ten. Innovations such as this have left Domino’s competitors in its wake.</p>
<p>Even this market hero, however, has clay feet. Domino’s share price has declined sharply recently, in part due to a series of <a href="http://www.smh.com.au/business/retail/dominos-scandal-franchisees-selling-visas-20170211-guau8x.html">scandals</a> ranging from alleged immigration fraud to widespread <a href="http://www.smh.com.au/business/workplace-relations/dominos-pizza-workers-kept-in-the-dark-about-underpayment-for-almost-two-years-20170214-gucq1f.html">underpayment of workers</a>.</p>
<p>In terms of technology-based disruption, more is on the way. Innovators like Amazon have signalled an interest in moving heavily into the Australian economy, expanding its e-commerce model into groceries. </p>
<p>Its <a href="https://www.amazon.com/b?node=16008589011">Amazon Go</a> technology and business model, where customers walk in, take what they want, and walk out (with goods billed automatically to the customer’s account) is intriguing. </p>
<p>Innovations such as this promise to disrupt retail as much as platform-based innovators like Uber have <a href="https://theconversation.com/when-uber-is-legal-the-taxi-industry-will-have-nowhere-to-hide-48820">disrupted taxis</a>.</p>
<p>Amazon’s mainstay is general e-commerce. In the <a href="http://www2.census.gov/retail/releases/historical/ecomm/16q4.pdf">US,</a> e-commerce accounts for 8.3% of retail sales, while in <a href="http://business.nab.com.au/nab-online-retail-sales-index-june-2016-17897/">Australia</a> the figure is around 6.8%. In both markets e-commerce is experiencing double-digit percentage growth. It is chipping away at the fundamental economics of traditional retailers like Myer, which continues to struggle.</p>
<h2>Batten down</h2>
<p>Taken together, the retail sector will continue to be a tough place for incumbents to thrive. </p>
<p>Innovators entering without the legacies of outmoded business models and with the benefit of new technology will continue to usurp incumbent firms. </p>
<p>For consumers, choice and convenience will continue to emerge. For incumbents unable to deliver on these outcomes, the future is bleak.</p><img src="https://counter.theconversation.com/content/72844/count.gif" alt="The Conversation" width="1" height="1" />
<p class="fine-print"><em><span>The authors do not work for, consult, own shares in or receive funding from any company or organisation that would benefit from this article, and have disclosed no relevant affiliations beyond their academic appointment.</span></em></p>For consumers of Australia’s retail sector, choice and convenience will continue to emerge. For incumbents unable to deliver on these outcomes, the future is bleak.John Rice, Professor of Management, University of New EnglandNigel Martin, Lecturer, College of Business and Economics, Australian National UniversityLicensed as Creative Commons – attribution, no derivatives.tag:theconversation.com,2011:article/529422016-01-12T11:14:25Z2016-01-12T11:14:25ZAre plugs for pizza a breach of journalistic ethics?<figure><img src="https://images.theconversation.com/files/107848/original/image-20160111-6961-c8db7l.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=496&fit=clip" /><figcaption><span class="caption">Talking (pizza) head or journalist?</span> <span class="attribution"><a class="source" href="http://www.shutterstock.com/pic-134986916/stock-photo-thinly-sliced-pepperoni-is-a-popular-pizza-topping-in-american-style-pizzerias.html?src=_buxHWsJPuXj3XCZQd5vdQ-1-1">Nick Lehr/The Conversation via www.shutterstock.com</a></span></figcaption></figure><p>Between them, ESPN’s Adam Schefter and Chris Mortensen have amassed more than six million Twitter followers. All were doubtless fascinated to learn that the two sports journalists planned to watch football and eat pizza on New Year’s Eve.</p>
<p><div data-react-class="Tweet" data-react-props="{"tweetId":"682392316200534017"}"></div></p>
<p><div data-react-class="Tweet" data-react-props="{"tweetId":"682685524344205312"}"></div></p>
<p>At first glance, Schefter’s and Mortensen’s tweets appear to be the usual social media sludge, like your Facebook friend’s photo of the blueberry muffins she baked this morning. </p>
<p>But Schefter and Mortensen didn’t just say they intended to eat pizza. They specified whose pizza they intended to eat. (I’m withholding the name of their pizza provider on the grounds that the company has gotten enough free publicity from this little affair already. For the purposes of this discussion let’s call them Big Pizza.)</p>
<p>There are two possible explanations for these tweets:</p>
<ol>
<li><p>In an amazing coincidence, Schefter and Mortensen were seized by the same unsolicited, spontaneous urge to share their enthusiasm for Big Pizza. </p></li>
<li><p>The tweets were plugs, which is to say, paid endorsements. It should be obvious that the correct explanation is B, but it wasn’t nearly obvious enough: the tweets weren’t labeled as ads. </p></li>
</ol>
<p>A few days ago, Deadspin <a href="http://deadspin.com/pro-dominos-pizza-tweets-from-adam-schefter-chris-mor-1751177008">called them on it</a>. The Wall Street Journal <a href="http://www.wsj.com/articles/why-espn-lets-its-commentators-tweet-dominos-ads-1452123132">followed up</a>. Both news outlets pointed out that the Federal Trade Commission frowns on such nondisclosures. The coverage prompted apologies from ESPN and Big Pizza. </p>
<p>“It was a mistake,” said Big Pizza.</p>
<p>From a journalism ethics standpoint, this isn’t exactly <a href="http://www.nytimes.com/2003/05/11/us/correcting-the-record-times-reporter-who-resigned-leaves-long-trail-of-deception.html?pagewanted=all">Jayson Blair</a> or <a href="http://www.latimes.com/business/hiltzik/la-fi-mh-stephen-glass-is-still-retracting-20151215-column.html">Stephen Glass</a> territory. (Blair, writing for The New York Times, and Glass, writing for the New Republic, were banished from newsrooms forever for passing off fiction as fact.)</p>
<p>Compared to the gross conflict of interest at the very heart of ESPN’s existence, the New Year’s pizza tweets are the tiniest of blips. (The media conglomerate purports to offer unbiased news coverage of the very leagues they pay hundreds of millions of dollars to for broadcasting rights.)</p>
<p>In fact, the usual conflict of interest concerns barely apply: journalists are told not to take money from outside entities lest their impartiality be compromised – or appear to be compromised – if ever they are called upon to report on those entities. But there’s little chance of a sports journalist ever being asked to dig up dirt on Big Pizza.</p>
<p>A credibility problem festers here nonetheless. As a reporter, I’m expected to name people and organizations only when they’re relevant to what I’m reporting. If I toss in a reference to a person or organization as a favor, or because I’m a friend, or for a fee, it calls into question all my choices of who and what to name, just as using <em>one</em> staged or digitally altered news photograph calls into question the legitimacy of all other news photos: how is the audience to know whether an image is real or fake, whether a story is newsworthy or promotional?</p>
<p>Some might say that any discussion of journalism ethics is moot when it comes to ESPN’s “personalities” because they’re not really journalists at all. Or if they are, they’ve clearly taken off their journalistic fedoras and put on their party hats when they tell their Twitter followers their exciting plans for New Year’s Eve. </p>
<p>This, we’re told, is the mashed-up world in which we all must live: Everyone glides from platform to platform in a seamless meld of news, gossip and marketing.</p>
<p>Well here’s the fuddy-duddy view. First, Schefter and Mortensen most assuredly are journalists. Both had distinguished careers at respected newspapers before coming to ESPN. Mortensen has won a George Polk Award, which is to the Pulitzer Prize as a Golden Globe Award is to the Oscars. </p>
<p>And if you’re a journalist, you’re always a journalist. There’s no going “off-duty.” If I’m covering Donald Trump on the campaign trail for The New York Times, I can’t blog, tweet or yammer on a TV talk show about what a blowhard he is. Anything I say in any of those contexts becomes a prism through which my work for The New York Times will be judged. </p>
<p>Disclosure of the Big Pizza tweets as ads would have solved the problem of the audience not knowing when Schefter and Mortensen are speaking for themselves and when they’re speaking as paid pitchmen.</p>
<p>But a cheesiness problem remains. Surely ESPN pays these guys enough that if Big Pizza comes calling, they should have no trouble saying, “No thanks.”</p><img src="https://counter.theconversation.com/content/52942/count.gif" alt="The Conversation" width="1" height="1" />
<p class="fine-print"><em><span>Russell Frank does not work for, consult, own shares in or receive funding from any company or organization that would benefit from this article, and has disclosed no relevant affiliations beyond their academic appointment.</span></em></p>Two ESPN NFL reporters ordered in on New Year’s Eve. They just didn’t tell anyone they’d been paid to do so.Russell Frank, Associate Professor of Communications, Penn StateLicensed as Creative Commons – attribution, no derivatives.