Domino's Pizza India Launches 49 Rupee Pizza Sale
Customer Attrition Due to Inflation... Competing with Street Food
"No Toppings... Food Like a Rough Crust" Criticism Also Raised
Domino's Pizza India has introduced a 750-won pizza per pie to prevent customer churn caused by inflation.
‘750-Won Pizza’ Emerges Amid Inflation... "Catch the Customers"
A '49 Rupees (approximately 750 KRW) pizza' was posted at a Domino's Pizza store in India. [Photo by Reuters·Yonhap News]
On the 20th (local time), Domino's Pizza was reported by local and major foreign media to be selling a '49-rupee (about 750 won) pizza' in India.
Due to inflation sweeping across India, more customers are turning to cheap street food for their meals, prompting Domino's to take drastic measures to prevent customer loss.
Sameer Ketapal, CEO of Domino's Pizza India, explained, "With rising prices, customers are dining out less," adding, "We are sacrificing some profits to prevent customer churn."
In fact, as inflation in India has worsened customers' financial situations, Domino's Pizza's revenue in the first quarter of this year decreased by 70% compared to the same period last year.
Domino's had already been selling pizzas for 59 rupees (about 900 won), but due to the ongoing crisis, they introduced the 49-rupee pizza last February.
This is also interpreted as a strategy to maintain market share. Domino's Pizza India is the second-largest operation after the U.S., and competitors like Pizza Hut and Burger King in India are also running price discount events.
Additionally, India has a well-developed street food culture where a simple meal can be had for 10 rupees (about 150 won). Therefore, during economic downturns, customers may avoid choosing expensive menu items.
Moreover, the growth potential of the Indian fast food market is also taken into account. According to Euromonitor International, India's fast food market currently stands at around 5 billion dollars. This is a small figure compared to the U.S. (341 billion dollars) and China (137 billion dollars).
However, considering that India's population has surpassed China's to about 1.4 billion people, the fast food market remains a blue ocean. Euromonitor International forecasts that India's fast food market will grow by 15% annually until 2027.
‘Box Without a Lid’ and Reduced Toppings... Some Criticism Arises
An employee of Domino's Pizza in India is packing a "750 won pizza" in a box without a lid. [Photo by Reuters·Yonhap News]
To offer the 750-won pizza, Domino's is cutting costs in various ways.
Since December last year, Domino's has been providing pizza boxes without lids to customers who take out their orders from stores. This saves about 75 won per pizza. Since 63% of customers are takeout customers, this has significantly helped reduce costs.
The amounts of cheese and tomato have also been reduced. As of May, cheese prices in India increased by 40% compared to last year, and prices for chicken and paper boxes rose by 30%. Recently, due to the 'monsoon heavy rains' causing flooding damage and poor crop yields of various agricultural products, tomato prices surged by more than 400% within just a few weeks.
However, some customers have criticized these policies, describing the pizza as having a "rough crust" and other negative remarks.
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