Happiness Delivered by Spain’s Telepizza

Headquartered in Madrid, Spain, Telepizza is the world’s fourth biggest pizza delivery company by number of stores and the biggest pizza store operator outside of the United States.

With a combined network of over 1,600 stores including company stores and franchise stores in twenty-three countries, Telepizza floated on the Madrid stock exchange in 1996 (although it has since de-listed) and is an industry leader in Spain, Portugal, Chile and Colombia, even outselling McDonald’s in its home market.

With a proven business model and expertise in international markets, in 2018 it joined forces with Pizza Hut to “lead the world pizza business” resulting in further sales growth of 14.5% in the twelve months that followed. Describing itself as a “pioneer in digitalisation” and with over 35% of its sales already coming through digital channels, we were keen to explore this company’s approach to innovation and customer loyalty in this intensely competitive sector of the global restaurant market.

Telepizza boasts impressive staff, social media and store numbers with future ambitious plans to double its footprint.

Digital Direction

Telepizza positions itself as “a tech company that makes and delivers pizzas” and began its digital journey in 2004, even before Twitter and Facebook had arrived in Spain. Its commercial rationale is certainly compelling when the company explains that “average spend per customer increases 35% for digital orders as opposed to those made by phone” as well as enjoying greater order accuracy, while also facilitating the launch and promotion of new products. Its eCommerce app that enabled orders was launched in 2017 and seems laser focused on enabling “ongoing conversation with consumers”. In fact, acceptance of marketing communications is a mandatory requirement for customers who want to join the “Mi Telepi” program and earn their currency “Telepicoins” towards rewards.

The Telepizza app includes ordering, tracking, offers and rewards . 

Mi Telepi

How It Works

Every order over €7 earns telepicoins, with additional telepicoins awarded for every €5 spent above the €25 spend range for the first coin – as shown here.

Members earn 1 Telepicoin for every €5 spent over €25 – up to a maximum of five telepicoins for orders over €40.

In addition to this, spend frequency is rewarded with a higher tier status, with higher tier customers (silver and gold status) simply enjoying more reward options than bronze members.

Telepizza Members are classified as Bronze, Silver or Gold.

Concepts We Like:

1. Reward options are very accessible – starting at just two telepicoins to claim a reward such as a soft drink or a portion of onion rings or potato wedges.
2. Telepicoins are valid for use for up to twelve months.
3. While tier increases are earned within 30 days, they are retained for 60 days before members are downgraded.

Concepts That Surprised Us:

1. With telepicoins earned on spend from a relatively high base (over €25), it seems counter intuitive that ALL orders over €40 are limited to just earn 5 telepicoins. Orders over €40 may be less common but surely should be increasingly awarded to incentivise bulk orders such as office or large party groups. Market leaders such as Domino’s that we’ve written about previously have identified the business market as a key segment and enabled additional ordering channels that fit the corporate market.
2. Telepizza is clearly excelling operationally in emerging markets such as Latin America, however its description of itself as a technology company is not nearly as credible as Domino’s – the world leader in digital ordering channels. Telepizza offers five ways to order (in store, online, by phone, in app and Alexa), however with Domino’s boasting fifteen different channels, Telepizza is not yet in the same league digitally.

Closing Thoughts:

Telepizza is a brand with plenty of ambition and the scope and resources to achieve its goals. While its digital capabilities lag behind its global competitors, it’s fantastic to see this company achieving its goal of delivering “moments of happiness” and using its loyalty program and digital strategy as essential tools to help drive the ongoing success of the business.