postcards from the florida republic: an independent and profitable state of mind.
In July 2004, one of the world’s most innovative tech companies went public.
The money poured in. And why wouldn’t it?
This company was one of the earliest adopters of online commerce - a radically disruptive titan which upended the traditional dynamic between businesses and consumers.
That was for openers: This e-commerce giant would go on to create some of the most critical technologies and applications in satellite navigation, online delivery systems, autonomous driving, customer personalization, and communication.
In fact, it’s one of the essential innovators in how consumers communicate across platforms like smart TVs, smartwatches, Facebook Messenger, Twitter, and even Ford’s digital auto dashboard.
And it completely transformed the way that people buy products.
Now, if you think I’m talking about Google, you’re mistaken… though I don’t blame you a bit.
The mainstream media has pushed a very specific and extremely narrow concept of “AI stocks” and “tech companies.” That’s one of the reasons why a small handful of stocks have led the “Great 2023 AI Rally.”
The truth, as I’ve shown you over the past few days with picks like Exxon Mobil (XOM) and Deere (DE), is AI and tech are a much bigger “tent” than Wall Street and the media would have you believe.
There are excellent companies with sane valuations and fantastic long-term hold potential innovating and leveraging AI right now. They’re using these technologies to add shareholder value.
These “stealth” tech stocks are right there for the buying and in a lot more places than you’d think.
That said, it might not surprise you to learn Google’s IPO was in August 2004… one month after the landmark IPO I’m talking about.
And if you think Google’s artificial intelligence (AI) prospects are exciting… wait until I deliver today’s recommendation…
Constant Special Deliveries for Investors
For 17 years, since well before the AI craze took over the markets, Domino's Pizza (DPZ) – was a better-performing stock than Google, now known… for some reason… as Alphabet (GOOG).
I know… I know… that sounds insane, but the math doesn't lie: When you add up dividends and total return, PDZ blows GOOG away. But you have to understand that Domino's is not just about pizza.
Domino's could very well be a better technology company than Alphabet.
You just didn't know it.
Let's start with an appetizer.
Dominos generates more than 60% of its orders from digital platforms.
The company couldn't have reached that level of digital integration without getting there first… And that's a massive trend for Domino's. They always get there faster than everyone, whether it's delivering food or integrating digital innovation.
This was the first major pizza chain to offer online and mobile ordering. The company started its foray into online ordering in the late 1990s. I'm talking on dial-up modems here. By 2007, it launched an online platform on its website, allowing customers to place orders.
For its next trick, in 1998, it created the "HeatWave" bag, which keeps food warm during delivery. This simple innovation is a staple of almost every delivery giant today. By 2008, it had created the Domino's Tracker, a real-time order tracking system. It provided customers with updates on the progress of their order, from preparation to delivery, enhancing transparency and customer experience.
Today, nearly every delivery company replicates that experience or tries to anyway. In fact, when I ordered Chipotle on Thursday, it was almost the same customer experience that I had with Domino's 15 years ago.
Of course, back then, who would want to track food online?
Then, it released its mobile app in 2011. People started buying pizza directly from their shiny new Apple and Samsung smartphones. The app allowed people to customize pizzas, save their preferences, and then reorder at the push of a button.
It moved into voice ordering with Amazon's Alexa in 2014. Today, these technologies seem commonplace. It was revolutionary eight years ago that you could use voice commands to tell a robot to order you a pizza. A year later, they integrated simple ordering functionality across smart TVs, social media platforms, and even the dashboards of Ford trucks.
Then, it started a partnership with the robotics company, Nuro. It tested robot pizza delivery across Houston. When the pizza arrives, users plug in a unique code to unlock a chamber and take their pie from the robot. And it also tested drone delivery programs in New Zealand. And – of course – there are the famous Hotspots. This 2018 program enabled pizza lovers to meet their drivers in public places like beaches and museums.
That program evolved into the brand-new Pinpoint Delivery service, which launched on June 20. It allows users to get pizzas delivered… pretty much anywhere, no standard address required.
So, that's an impressive list of technological accomplishments and innovations by any standard, even Silicon Valley's, but we're about the future here.
And, as I'll show you, what Domino's does next could take its tech edge up to XL
Pepperoni and Mushrooms and Data and Natural Language Processing
I've said it before, and I'll say it again: Domino's is a data company. When you order a pizza lunch on a Monday, the company will return in a month and ask you if you want to order the same pizza.
Domino's will be an AI player, too. It's already well on the way; Domino's started its artificial intelligence efforts five years ago. It currently engages AI chatbots to provide customer service. This technology can take customer orders, make recommendations based on previous orders and behaviors, and use natural language processing (NLP) to answer questions.
Domino's also leverages AI and predictive analytics to explore new and existing customer data. This allows it to determine customer buying patterns, which can fuel the type of marketing I mentioned above. Order a pizza from Domino's this week, and I guarantee they will market you about the same pizza on a predictable timeline.
It uses AI to optimize delivery, navigate traffic, organize inventory, and drive efficiencies through its business. AI also monitors customer feedback on social media, tracking sentiment analysis across various platforms to better manage the Domino's brand. Feedback goes directly to marketing managers and other stakeholders in the business.
Finally – and most important – AI makes the pizza good. Computer vision technology can use AI to objectively determine the quality of a pizza. Like an AI-powered robotic surgeon, AI will be able to determine abnormalities in the pizza, determine if ingredients are correct and sufficient, and ensure quality and consistency for each order.
To your wealth,
Garrett
About the Author
Garrett Baldwin is a globally recognized research economist, financial writer, consultant, and political risk analyst with decades of trading experience and degrees in economics, cybersecurity, and business from Johns Hopkins, Purdue, Indiana University, and Northwestern.