No address? Domino's harnesses tech in pizza delivery breakthrou - CBS News 8 - San Diego, CA News Station - KFMB Channel 8

No address? Domino's harnesses tech in pizza delivery breakthrough

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Craving pizza and have no address? No problem.

In a twist to the emerging "delivery economy," Domino’s Pizza will accept orders to 150,000 designated places across the U.S. on Monday that don’t have traditional street addresses, whether they are parks, beaches or landmarks, such as statues or St. Louis' Gateway Arch.

The Ann Arbor, Mich.-based chain has created a network it calls "hotspots," which enables hungry customers to get their prepaid online orders anywhere from the Las Vegas Strip's iconic welcome sign to the statue of "godfather of soul" James Brown in Augusta, Ga., by using their smartphones to select a predetermined delivery spot closest to their beach chair.

The development represents a leap in an industry that pioneered home delivery long before Amazon, Walmart, Target and restaurant chains decided their futures depended on it. Now, as retailers and restaurant competitors try to figure out how to profit from delivering goods straight to peoples' doors, a pizza company is taking it to the next level.

"This is a really big delivery innovation," said Dennis Maloney, Domino's chief digital officer. "It's not necessarily a brand-new technology. It’s the application of technology in a new way."

Making address-less delivery a reality was the confluence of two trends, he explained. A growing number of people are ordering all types of food online — at Domino's, for example, it's now up to 60% — and smartphones have become universal. The plan takes advantage of smartphones' navigation and mapping abilities.

When the food is en route, customers get a text message telling them to head to the drop-off spot and keep watch for the traditional marked Domino's delivery car. When customers initially place their digital orders, they have the option of adding self-descriptors, like what they're wearing, so drivers can identify them easily.

"Every person at the company has at some point wanted to get pizza delivered to somewhere where they couldn’t," Maloney said.

Other Domino's hotspots include points within the National Mall in Washington, D.C., home to the Smithsonian Institution museums and Washington Monument; and the Atlantic City boardwalk. Every state has at least one.

There are some places that aren't included. Maloney, for instance, said he didn't think any homeless encampments are on the list.

Domino's began testing hotspots in the Miami area in the fall, according to Maloney. Along the region's namesake beach, for example, there was one about every quarter-mile.

Experts say the move represents an innovation.

"It’s the holy grail of everything they’d like to do in the context of delivery," said Tim Bajarin, president of the San Jose tech consulting and research firm Creative Strategies. "You, as a customer, are no longer glued to an office or a home." 

But, he said, executing this "hotspots" plan could pose logistical problems, such as a lack of parking for pizza delivery drivers at busy intersections or congested stadiums. 

In the highly competitive chain pizza business, the move could bolster the Domino's brand reputation, even if the sales from address-less orders are relatively small, according to Stephen Anderson, senior restaurant analyst at New York-based investment bank Maxim Group. Domino's can make a big splash without having to spend much on the plan.

"It's part of their 'anywhere, any method' strategy. It's something where they can get incremental business," he said. "They want to be where the customers are."

Rivals are sure to watch. Pizza Hut — citing the need to protect its drivers — requires an actual address to ward off the potential for pranks or worse.

"We are testing advanced ways to track the driver’s location, which is a bigger customer benefit," Pizza Hut spokesman Doug Terfehr said.

To ensure its drivers are safe and prevent bogus orders, Domino's requires prepayment before it will deliver pizza without an address. The chain, however, will still allow the drivers to be tipped, according to Maloney. Drivers are required to wait five minutes for customers to show up, after which how long they stick around is up to them.

Drivers also will confirm customers' identities. "They’ll ask you your name and what did you order," Maloney said. "It's easy to tell a customer who's trying to bluff their way into free pizza or someone who really ordered pizza."

Domino's has being trying to position itself as a tech leader. It has embraced innovations such as accepting food orders in the form of a tweeted pizza emoji, introducing an app that lets you monitor your pizza's precise journey from the store to your home and testing driverless vehicles to deliver pizza.

The company said it has an estimated 14,800 stores in more than 85 markets, including about 5,700 and roughly 30,000 drivers in the U.S.

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