Alexander Makarenko and Oksana Tulpinova told us about personalized marketing in Dodo Pizza. We had a conversation about how the Mindbox platform helps them develop this direction, what are the results and what will be direct marketing like in 2019. How did the direct marketing work in Dodo Pizza before Mindbox? Alexandr Makarenko: I will […]
Dodo Pizza: «Direct marketing brings us 19 % of our revenues from delivery and carryout»06 Aug. ‘19
Alexander Makarenko and Oksana Tulpinova told us about personalized marketing in Dodo Pizza. We had a conversation about how the Mindbox platform helps them develop this direction, what are the results and what will be direct marketing like in 2019.
How did the direct marketing work in Dodo Pizza before Mindbox?
Alexandr Makarenko: I will start with a little introduction. I started working at Dodo Pizza in April 2017. At that moment, there were no federal marketing, my colleague and I just started building it. I was responsible for clients loyalty, and my colleague’s part was attracting new clients.
As for my responsibility, we only used local messaging. Our franchisees or partners downloaded clients base by hand and sent emails. Nobody knew what and how exactly they did. But even then I knew that personalization and segmentation of emails were going to be our priority.
Then we started experimenting: searched in MySQL base, for example, people who had their birthday yesterday and send them letters. We looked at the conversion rate and compared it to other approaches. And we realized that the rate is better while attracting new clients is cheaper.
Then we wrote a script that downloaded and sent the data automatically. Sometime later, we started to do this via email by hand. As a result, we had several disconnected, fully independent systems.
At that time, I realized we need to level up and started to study the market and colleagues recommendations. Unfortunately, first attempts were not successful. Tools were either too expensive or too complicated for our needs.
We chose Mindbox because of its flexibility that allowed us to start with a small base for a small price. When it became clear that the system is profitable, we switched to using Mindbox for the whole base.
What is the marketing strategy of Dodo Pizza?
A. M.: We are constantly switching between approaches. When we started, we did a lot of promotions. When Oksana joined us, we switched to promoting our brand. Now we are back to promotions.
And there’s a reason for that: clients think about the price first and only then assess the quality and stick to us. But we’d like to be generally perceived as an affordable product. That’s why we focus on promotions.
We add to emails personal offers based on the client’s history. And we tell about the products the client hasn’t tried yet. That’s how we invite them to try something new.
Value pyramid of our brand is called VKOD+ and stands for taste, quality, openness, and trust (vkus, katchestvo, otkrytost and doverie respectively). It all starts when a person tries our pizza for the first time. If they like it, they can learn about our approach to quality. Openness allows our clients to find out more about the company and even watch the cooking process via webcam. That’s how we earn long-term clients loyalty.
What do you think is the value that is supported by Mindbox the most?
A. M.: I think all of them because Mindbox is a tool. If you need to batter down a nail, can you do it without a hammer? I don’t think so. Well, you can try and maybe something else will do… But you lose time and effort anyway. Mindbox is that hammer, we would suffer without it for a very long time.
I know what I’m talking about. At my previous job, we used to do everything by hand. We even developed our own system for sending mobile push notifications. It took us so long and was really painstaking. Developing your own data management system is difficult.
That’s why we chose Mindbox and trusted them with a part of direct communications because they are so professional. At the same time, it’s really transparent, whereas what the other systems offer is really a black box. You don’t know how they work. But Mindbox is very open. We not only upload data but also get detailed analysis and use it to build our system and assess messaging effectiveness.
How does Mindbox help do your job?
Oksana Tulpinova: Mindbox is a system on which our entire direct communication is built. If we didn’t have it, or some other alternative, we would practically be left without our direct communication.
It’s inconvenient to use various solutions for different channels. We cannot collect analytical data in one place or combine emails, push notifications and SMS. That’s why we chose Mindbox, it’s universal and aggregates channels. Also, we can include other channels if we want to. For example, we integrated VK messaging very smoothly.
We linked up with others who could provide solutions, but they couldn’t help us. They told us they can add our request to their backlog and release the feature in three years. That wasn’t an option for us.
Moreover, Mindbox really helps s enrich user profiles with data that we collect. Some time ago, we ran a survey about kids, where we asked people if they have children under the age of 12. The data was collected and added to profiles, and then, the people who had kids were introduced to coloring books. It works better for people because it’s a close subject for them. We wouldn’t be able to do something like that with our in-house tools. Now Mindbox pretty much knows more about our clients than we do.
Can you tell us about the process of working with the service? How does it happen?
O.T.: All that we need we can set up directly in Mindbox. In a nutshell, you sign in, set it up, and launch it.
It’s that simple?
O.T.: Well, no, not really. Mindbox is not so user-friendly. I was a bit disappointed when I first saw the interface. But, I learned to appreciate it later on because it’s great functionality allows one to do some cool stuff. For example, collect data about retail purchases, client behavior in regards to a product, etc. It’s kind of an alternative to coding.
That’s why the system seems convenient once you get used to it even if at first it seems twisted beyond measure. You can set up literally everything that comes to mind, collect, and study analytics for all parameters.
Mindbox aggregates all orders and client actions. If I want to see how many clients have ordered a 25-centimeter Pepperoni four times within the last week, Mindbox can tell me that. We have the ability to do this without them too, but it’s going to take more time and effort compared to simply signing in to Mindbox and making a request.
A. M.: It’s true, Mindbox has a very functionality-oriented interface. First and foremost, we use it to solve our business tasks. It’s important for us that the system be capable of solving a huge range of tasks, from simple newsletters to experiments with chatbots that we want to launch. That’s why user-friendliness is not a top priority feature. You just need to sit down and dig into once, and then you will be able to get through tasks very quickly.
Can you give some examples of tasks like that? Maybe newsletters that you’ve run through Mindbox?
O.T.: We have mass and triggered surveys. We use mass surveys if we need to gather a large amount of data. An instance of this occurred when it was Pizza day, and we had to collect reviews. In this case, we sent out letters to people in our database. We asked if they know about the Pizza day, have they ever been to us, and what issues did they experience. That way we receive a large chunk of data that we can work with.
Triggered surveys we also do via email. For example, after we’ve launched something new: «Hello! My name is Yulia Tsypanova, and I am the creator of the Olivier salad pizza recipe. You’ve ordered one recently and your opinion matters to us. Tell us what you thought about it.» The person answers, and later Yulia Tsypanova shares with us her insights from the survey.
Where there situations where a survey influenced the product?
O.T.: Oh, there are lots of cases like that. For example, we added the «Four cheese pasta» and started collecting feedback on it from the very start. People told us the portion is too small, even though it’s the same as the rest of them. So that means something is wrong. We looked into the issue and it appears that the portion looks small because the cheese squeezes down the pasta. That’s how we realized that we needed to change the foil trays in which we serve pasta. We also changed its pictures on the web site. We made them more realistic by slightly lowering the level of pasta.
What else do you use Mindbox for?
O.T.: I think we could name the channels we use. They are web and push-notifications, email, SMS, and Viber.
Thanks to the push-notifications, our revenue sky-rocketed just after we started using this channel. Of course, we cannot say that this happened entirely thanks to Mindbox because sooner or later we would have realized this feature anyway. But, thanks to Mindbox it was done easy and quick. We just integrated push-notifications and started working with them. This allowed us to really increase our revenue and database outreach.
A. M.: Thanks to Mindbox, a lot has changed in our work. For example, we used to send a monthly email about new products. The text in them was just a sales pitch, it went something like «try our new and tasty pizza.» But the process had no automation, no complicated scenarios like a survey.
Now we have all the push channels that allow for huge reach. Emailing developed both in terms of communication quantity and content quality. We made a huge leap from 5 line emails to real stories that you can publish in your blog or on a web site without shame.
Dodo Pizza is a huge network. Does that generate issues when working with Mindbox?
A. M.: We experienced organizational challenges at the start. There are 450 pizzerias, but only 20 and a pinch are owned by me. The rest is franchisees.
Initially, we split the cost of Mindbox amongst our partners. But it was difficult to sell Mindbox as a solution to them without having real figures on hand. But they came to realize the value later on, step by step. We showed them that service is profitable and automation does indeed work.
But in the beginning, we received reactions like «What is that spending? Can we go about without it or do it with our own resources?» Or even worse: «We always carried out messaging manually, why would we need this system?» But no such questions remain anymore. Mindbox has earned its place in our cost structure and is now a part of our federal marketing. Our investments in Mindbox are just as important to us as the funds we spent on TV advertising.
O.T.: If our partners work on another platform, we have to go through everything that they send manually. It’s difficult to collect unified analytics and work with them. Moreover, this makes it impossible to limit outbound messages. For example, our partner in Moscow can accidentally send SMS to clients in Tula and cover that mishap up with some lame excuse. Mindbox allows us to make this technically impossible. In addition, we set limits for the frequency of messages. In other words, a partner can try to spam his client base as much as he wants, but he just technically won’t be able to do so within the bounds of Mindbox.
When a new partner comes in, do they get full access to the system?
O.T.: Mindbox developed a cool interface for our local partners. Our partners can now set up direct communication lines through Mindbox themselves. We allow them to use SMS and Viber for that purpose. They receive a special interface and access terms. We need to play things out so that by April, all of Russian partners are on Mindbox.
And we also integrated the first country which will independently carry out direct communications, that’s Belarus. We are now collectively working on providing a solution that will be convenient for everyone.
How far have you come along in terms of connecting partners to Mindbox?
O.T.: The interface and technical means for integrating our partners was finalized in December. Now we are in the testing phase with 15 partners who are trying to get a grip on what’s going on.
Our corporate network was the first to switch over. As practice shows, if you provide good instructions, your local guys will understand everything. They have their main scenarios, and they don’t branch off and introduce anything out of the ordinary. Everything is rather predictable in this regard, which is why we simply make instructions and tell them how things work and how they can use them.
For example, now, they cannot make triggered communications because they work in a different system. But Mindbox will make it possible. In April, all of our local partners are going to switch over to Mindbox.
What are the direct marketing results for Dodo Pizza, in numbers?
O.T.: We had a goal to make 10 % of our delivery and carryout revenue come from direct communications by summer 2019. We’ve already reached and exceeded that mark on account of implementing pushes.
When we first launched them in September, we reached 20%. On average, direct marketing brings us 19 % of all our revenue from deliveries and carryouts. Again, it’s an average number across a five-month period, but there were months when it was even greater.
A. M.: We thought that 10 % was already a lot because when we were starting out, that was only 0.5%.
A. M.: We looked at open data and realized this is the percentage of website visitors our competitors get from emails. The largest indicators were 10–15 %. And we decided to set ourselves a goal such that it would make us increase our channel quantity and communications.
Moreover, we presented this goal during our partner gathering. It’s an annual event, something like a general meeting of shareholders. We meet our franchisees, investors, potential partners, there are a few thousand people there typically.
What are your marketing goals in 2019?
A. M.: If we touch on our business goals, related to direct communications, we have a rather simple one for the year. We want to get a revenue of $1 billion by December, using our current attribution model. That is a significant share of all revenue. Almost double of what it is now, well, closer to 40% actually.
And we have a very dynamic federal PR campaign starting this year too. Nonstop advertisements, you could say. The share of new clients who have never heard of us is constantly decreasing. In the future, we will also change the definition of a new client. We will make it so that it’s not someone who has never tired us, but rather someone who hasn’t made an order in 12 months.
Stemming from this, the impact of our direct communications is going to grow constantly. Maybe at some point, it will become the key source for orders.
What will be the role played by Mindbox in terms of Dodo Pizzas marketing in 2019?
A. M.: Mindbox is the tool we are using to reach our goals. From a tactical perspective, it was to aggregate all messaging occurring outside Mindbox into one system. From a strategic perspective, to improve our skills so that we are able to pack everything inside Mindbox and automate it.
Can you point out what you especially like about Mindbox, and what could be improved?
A. M.: I like the openness and flexibility. These are two key factors that we love about Mindbox. The system allows one to customize practically everything. Your fantasy and professional skills draw the limit.
You can utilize all of the data inside Mindbox. That’s quite rare, as most services never release data, and don’t share info regarding the algorithms used. Kind of a «pay us and will provide you with results» type of deal. We are not about that.
Speaking of drawbacks, the interface leaves something to be desired, but that’s temporary. At the moment, Mindbox is going through growing pains as the workload on their services is increasing. I’m sure the guys will manage to get through them though, and their stability will be great. Really, all issues were managed to be solved. The company is willing to listen, hear, and help.
From your perspective, for which companies can Mindbox be viewed as a good investment?
O.T.: Some part of the functions available will come in handy for everyone. For example, our product team often needs to download something from the system. It could be information related to people who have ordered a product a certain number of times within a given time period. It’s more difficult to load that out using internal functionality as opposed to using Mindbox. Kind of a quick fix solution really, as Mindbox wasn’t conceived for simply loading out data.
A. M.: Mindbox is actually for well-formed and mature companies. I say this because the tasks it helps with don’t arise within a company right from the start. If the company is new, the majority of its clients are new. Thus, communicating with current clients who have left their contact information is not that relevant.
If you have less than 10 thousand clients in your base, then it doesn’t even make sense to look in this direction. Moreover, it’s important to consider what type of delta automation will add. If you have no idea on how to communicate with a client, and want to automate this process immediately, well, you’re just going to multiply the chaos you’re already swimming in.
Taking all of this into account, I feel that the direction which we chose is rather wise. Initially, we tried to do all of this manually, and when we realized what works and what doesn’t, we introduced automation and complexity. Mindbox suits those who already have an established base and are ready to dive into that, those who find importance in how and what is communicated to a client.