Domino’s Pizza: Crisis Communication Strategies

Case Analysis &

Press Release

Submitted To:
Prof. Sriparna Basu

Submitted By:
Aman Jain
261068

11th December 2017

Case Overview

 On Easter Sunday in April 2009, two employees (Kristy Hammond and Michael
Setzer) in N.C. posted 5 appalling video’s on YouTube showing an individual sticking
mozzarella cheese up his nose and then blowing the cheese on sandwich, among other
sanitary and stomach-turning activities
 Video went viral, garnering 1 million hits within only 2 days
 Public and loyal fans weren’t satisfied with the response as there were internal
resolution of conflict but the company never released any public statement which
caused further damage to the brand image.
 Finally the company issued a formal apology which was initially released on their
website and later on their You Tube account when their website did not generate
sufficient hits.
 To spread their apology to more customers , they asked their followers on twitter to
retweet the link to that web page.

Situation Analysis

 SWOT
Strength Weakness

 Strong brand equity  Poor social media

 Huge market base
 Excellent service delivery
 Innovative product market
strategy
 Food standardisation &
quality
engagement
 Undefined employee policy
 Ineffective use of social
media technology to increase
customer reach
 Lack of updating of employee
policy regarding job and
organisation satisfaction

Opportunities Threat

 Tap into online market  Domino effect on market

 Improve traffic on website reputation
 Law suit litigation
  Clearly crafted social media  Threat of substitution
policy  Threat of increased buyer
 Repositioning power

 The action from the company front was quick, but since there was no external
communication or public statement been released, consumers found themselves
cheated.
 The company was not prepared for such a crisis situation as a result they went into a
total defensive mode.
 They underestimating the power of social media and the speed at which things fly via
internet
 They decided to fight viral with viral in the sense they integrated social media into
crisis communication strategies and posted their response video on the social network
from where the crisis outbreak started.
 They did put forward their actions in such a way that so as to ensure the audience or
their customers that this horrific situation would not have the opportunity to happen
again.

 The U.S president, Patrick Doyle released the response video on website and
subsequently on You Tube.

Porter’s 5 forces :-

Porter’s 5 forces

Threat of new entrants:- Dominos may face threat of new entrants after this crisis
communication incident as the new emerging company might find this as the right platform
to leverage on the temporary damaged image of Dominos.

Bargaining power of buyer :- Since there is already immense competition in the fast food
industry , the switching cost for the buyer or the customers are relatively low which
 considerably increases their bargaining power as the deterred image will derail the company
prices.

Bargaining power of suppliers :- Since the suppliers of dominos will be disappointed after
the recently hit image of company which will subsequently affect their existing suppliers .
Due to which the supplier count might decrease and the remaining may hike their charges.

Industry rivalry :- The rivalry in the fast food industry will increase as the other competitor
will try to cash upon this opportunity and increase their market share and in turn overall
revenue.

Threat of new substitutes :- Other companies may bank upon the substitutes conflict and
position their product as being and delivering quality.

Dominos dealt with all phases of crisis incident by following Seeger’s principles like-

1. Process approaches and policy development;

2. Pre-event planning; - The company did not act hastily and collaborated with various sources
for deciding upon the action to be undertaken

3. Partnership with the public; - The company partnered with the public to observe and
interpret the events that took place after the video was uploaded

4. Listen to the public’s concerns and understand the audience; - The company waited 24 hours
before giving a response and till that time tried to understand the audience reviews and
listen to their tweets.

5. Honesty, candor, and openness; - The company responded by uploading a viral video on
youtube. In the video they openly stated the steps that Domino’s was taking to deal with
the issue to make sure it never happens again.

6. Collaborate and coordinate with credible sources; - the company collaborated and
coordinated with credible sources like the watch dog organizations and local authorities for
handling the crisis
7. Meet the needs of the media and remain accessible;

8. Communicate with compassion, concern and empathy; - Domino’s used youtube platform
for distributing information back to users in order to prove itself with action and to
communicate with passion, concern and empathy
9. Accept uncertainty and ambiguity; -

10. Messages of self-efficacy. – The company was able to manage the crisis by giving a message
through online medium

Problem Statement
Macro problem - Inapt attention to social media management

Sub problems –

 Low customer reach through social media

 High response time taken in replying to customers on social media
 No monitoring of social media presence of the company
 Lack of internal expertise in managing social media
 Haphazard social media messages

Another major problem was of lack of employee citizenship behaviour in the organisation.

Problem Analysis:

 Poor control mechanism by the outlets and problems in the hiring procedure led to the
hiring of irresponsible and unprofessional employees
 Weak and slow response by the company to the crisis situation which could be due to
the following reasons:
o Under-preparedness for such a situation resulting in a totally defensive stance
by the company
o Underestimating the power of social media and the speed at which things fly
via internet

The primary problem here was not the video uploaded by those employees but the way
Dominos reacted to this video. Unfortunately, this problem can arise in-front of any
brand but how that brand responds and how well it manages the crisis is what matters
the most.

Decision Analysis/ Opportunities:

Short Term Decision: After checking their outlets and making sure that the video was
a hoax, issue a press release and defend the brand. Now since the employees were
Dominos’ own, don’t just blatantly blame them as it will raise question on their own
hiring policies. Use all social media handles to release this statement and use a standard
language that an enquiry has been initiated and those found guilty will be dealt with
strictly.
Medium Term Decision: Try to get a testimony from those irresponsible employees
that what they did was for fun and it was a hoax. If they don’t budge, use testimonies
of other employees. Give some customers a tour of your kitchen, show them how
products are prepared in a hygienic manner, record all these things and put them online.
Give proof of everything.
Long Term Decision: Work on your media handling team, make them proactive. Work
on your hiring procedures, run some background checks if possible and most
importantly, train your operations managers/supervisors of the outlets on how they can
curb/stop such incidents to happen in future.

Decision Criteria

 Express honesty and openness, concern

 Meet media needs & remain accessible
 Collaborate with credible sources
 Address public concerns
 Adopt best practices and control span of communication.

Generate Alternatives

 Tackle viral video with an apology video on YouTube

  Internal investigation against the two employees.
 Press release for communicating to media and customers
 Crisis management committee should be established

Evaluating alternatives w.r.t to decision criteria

Honesty, Meet media Collaborate Address public Adopt best

empathy, needs and with credible concerns practices and
remain sources control span of
concern accessible communication
expressed

Tackle viral High High Low High High

video with an
apology video
on YouTube

Television High High Medium High High

campaign for
regaining
reputation

Television High Low Medium High Medium

campaign for
regaining
reputation

Internal Medium Low Low High High

investigation
against the two
employees

Press release High High Medium High High

for
communicating
to media and
customers
 Focusing on Medium Medium High Low Medium
employee
satisfaction
and
recruitment
strategies

Crisis Medium Medium High Low Medium

management
committee
should be
established

Recommended Decision/ Best Solution and Implementation Plan

 Determine if the video was a hoax or reality: This is an important step which can’t
be skipped because ultimately the company runs its business via franchise models and
it has to make sure that the code of conduct is followed everywhere. This also sends a
clear message to the customers that the company will never compromise on the quality
of the food it serves to them.
 Promotion of open door policy to create transparency among the customers and
company, so that the users have confidence on the company activities and maintain its
public centric image.
 Setting up of twitter account to reassure customers of the brand inclination and zeal for
quality food and all what happened was just an isolated incident, actions for which will
be taken soon.
 In order to ensure damage control as well as for proactively winning back the
customers’ trust , release videos where irresponsible employees themselves should take
 the blame on themselves and apologise formally , else they should be sacked or
punished to show the stringency of rules , law and order of the company.

 Prepare well for the future: This primarily consists of 2 issues.

a. Work on the ways to make your social media team more responsive, proactive
and sharp enough to capitalize on the opportunities.
b. Improve your hiring procedures; train your operations managers as to how they
can control these situations by keeping the employees in confidence.
c. Train your working staff on behavioural issues; educate them on the importance
of their contribution to the brand and how one wrong step on their part can lead
to a bad situation for all the other ones. Inculcate a feeling of responsiveness in
them.

Contingency Plan
 A YouTube apology video should be uploaded with search engine optimisation (SEO),
in case the press release can’t be held by top officials.
 In case of any such future crisis communication, the use of google alerts with the name
of the company or other keywords can act as a timely risk aversion strategy.
 Giving access to official website and company media platform to limited people and
strengthen PR activities to take control and counter damage in case of any mischief.
 Discount and grievance redressal for customers who claim to be the victim of the food
adulteration.

Domino’s Pizza
PRESS RELEASE
Dominos launched Crisis Communication Strategies through Twitter and
YouTube. Why?

North California, April 16, 2012 - Domino’s Pizza is in an embroiled situation after its two rogue
employees posted videos of adulterated food on YouTube today. Kristy Hammond and Michael
Setzer posted video showing sticking mozzarella cheese up his nose and then blowing the cheese on
sandwich, among other sanitary and stomach-turning activities. The duo has created 5 videos in
total.

Tim McIntyre, Vice President of Corporate Communications, has determined that the video is not a
hoax and now is surveying a problem. Internal and external investigation helped him to determine
the names of the employees that are Kristy Hammond and Michael Setzer. External sources included
consumer watchdog organization GoodAsYou.org.

The company has decided to do research based on Arthur W. Page Society, Professional organization
for executives in the public relations and communication industries. This organization is charged
with the goal of “embracing the highest professional standards; advancing the way communications
is understood, practiced and taught; and providing a collegial and dynamic learning environment.
According to the Society’s website, the following principles are designed to guide public relations
practitioners’ actions: (1) Tell the truth; (2) Prove it with action; (3) Listen to the customer; (4)
Manage for tomorrow; (5) Conduct public relations as if the whole company depends on it; (6)
Realize a company’s true character is expressed by its people; and lastly, (7) Remain calm, patient
and good-humored.

They are continuously presenting the actions they are taking to assure that this horrific situation
would not have the opportunity to happen again.

By Tuesday, according to McIntyre, the company is planning to respond to customers’ queries on

Twitter about whether the company knew about the situation, what the company was doing, and
why the company had not issued an official statement.

By Wednesday, Patrick Doyle, President of Domino’s Pizza, will be recording an apology that will be
uploaded onto YouTube.