Domino’s Pizza is facing a backlash in Asia amid the ongoing turmoil in the Middle East. Sales of the popular American brand have suffered in countries such as Malaysia, where consumers are associating American brands with Israel’s war in Gaza. Domino’s Pizza Enterprises, the franchisee that operates Domino’s restaurants in various countries, reported that same-store sales in Asia fell by an estimated 8.9% in the second half of 2023.
This decline is attributed to the negative perception of American brands in light of the conflict in the Middle East. The situation in Malaysia is particularly significant, as the majority of the population is Muslim and the government has expressed support for Palestine. The backlash against American brands is not limited to Domino’s Pizza, as other companies like Procter & Gamble-owned brands and US-owned chains are also experiencing consumer pushback in the region.
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Background
In recent years, American brands have faced backlash in Asia due to ongoing conflicts in the Middle East. The association of these brands with America and its foreign policies has led to a decrease in sales and consumer boycotts in several countries. One example of an American brand experiencing this backlash is Domino’s Pizza Enterprises, a franchisee of the US-based Domino’s Pizza.
In the second half of 2023, Domino’s Pizza Enterprises reported an 8.9% decrease in same-store sales in Asia, with a significant impact on its operations in Malaysia. The association of the Domino’s name with the US and Israel’s war in Gaza has contributed to this decline in sales. This article will explore the impact of the Middle East turmoil on Domino’s Pizza sales in Asia and the broader backlash against American brands in the region.
Impact on Domino’s Pizza Sales in Asia
The decrease in Domino’s Pizza sales in Asia, particularly in Malaysia, can be attributed to the association of the brand with the US and Israel’s war in Gaza. Malaysia has a majority Muslim population, and the government has expressed support for Palestine in the conflict. As a result, consumers in Malaysia have associated American brands, including Domino’s Pizza, with the actions of the US and its ally Israel.
This association has led to a negative perception of American brands among consumers, resulting in a decline in sales for Domino’s Pizza Enterprises. Furthermore, Malaysia, as well as other Asian countries with no diplomatic ties to Israel, have been affected by the conflict, leading to a broader impact on Domino’s Pizza’s operations in the region.
Backlash against American Brands in Asia
Domino’s Pizza is not the only American brand facing backlash in Asia due to the ongoing conflict in the Middle East. Consumer boycotts have been observed in countries like Egypt and other Middle Eastern nations, where consumers are avoiding US-owned chains such as McDonald’s and Starbucks. Additionally, Procter & Gamble-owned dishwasher pods have also faced backlash in the Middle East, with consumers opting for alternative brands. The association of American brands with the conflict in Gaza has created a negative sentiment among consumers, leading to a shift in their purchasing preferences and a decline in sales for these brands.
Boycotts and Societal Pressures
Boycotts have emerged as a form of protest and risk avoidance in countries like Egypt, where street protests are seen as too risky by some consumers. These boycotts have had an impact on the sales of American brands, including McDonald’s, in the affected countries. While specific details regarding the effects on McDonald’s sales are not provided, the fast-food chain has acknowledged the societal pressures it faces in markets where it operates due to the conflict in the Middle East.
McDonald’s CFO Ian Borden stated during an investor call that the company is experiencing an impact on its business across several Middle Eastern markets and a limited number of markets outside the region. This highlights the significant challenges American brands are facing in these turbulent times.
Domino’s Pizza Enterprises’ Response
As of now, there has been no immediate response from Domino’s Pizza Enterprises regarding the decrease in sales in Asia. The franchisee has not addressed requests for additional comment regarding the impact of the Middle East turmoil on its operations. The lack of a response from the company raises questions about its strategy to address the concerns raised by consumers and the potential steps it may take to mitigate the negative impact on its sales in the region.
Other American Brands Facing Backlash
Alongside Domino’s Pizza, other American brands have also been affected by the backlash in Asia. Procter & Gamble-owned dishwasher pod brands have faced consumer boycotts in the Middle East, resulting in a decline in sales for the company. McDonald’s, another well-known American brand, has denied allegations that it funds or supports governments involved in the conflict. Likewise, Starbucks has stated that it does not have a political agenda and does not use its profits to fund government or military operations. Despite these denials, the negative perception of American brands continues to impact their sales and operations in the region.
Impact on McDonald’s and Other Brands
McDonald’s, in acknowledging societal pressures and the impact on its business in certain Middle Eastern markets, highlights the challenges faced by American brands in the region. The ongoing conflict in the Middle East has resulted in a decline in sales and a shift in consumer preferences, leading McDonald’s to face significant obstacles in maintaining its market presence. Similarly, Unilever, a London-based company that owns various brands, including Dove soap and Magnum ice cream, has also noted the effects of the Middle East wars on some of its brands, particularly in Indonesia. These examples highlight the widespread impact of the Middle East turmoil on American and other international brands operating in Asia.
Conclusion
The ongoing conflict in the Middle East has had a profound impact on American brands operating in Asia. Domino’s Pizza Enterprises, in particular, has reported a significant decrease in sales in Asia, primarily in Malaysia, due to its association with the US and Israel’s war in Gaza. This backlash is not limited to Domino’s Pizza but extends to other American brands, including McDonald’s and Procter & Gamble. The use of boycotts and societal pressures as a form of protest has further exacerbated the decline in sales for these brands. It is essential for American companies to acknowledge and address these concerns, as the impact of the conflict in the Middle East continues to affect their operations in Asia.
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