Papa John’s and the NFL: Just Another Excuse to Mask Poor Sales Performance?

The newswires, and social media, have been buzzing over Papa John’s CEO blaming the National Football League for his company’s decline in sales. “The NFL has hurt us. More importantly, by not resolving the current debacle to the players’ and owners’ satisfaction,” John Schnatter said in a recent earnings call.

DiGiorno Pizza in particular was quick to throw some shade on Schnatter’s charge that the "take a knee" controversy affects his company’s performance:

[embed]https://twitter.com/DiGiornoPizza/status/925751603478650880[/embed]

Schnatter ratcheted up his displeasure with the NFL over the weekend, when he told the Wall Street Journal that he may reconsider his company’s sponsorship of the league. Many talking heads in the professional sports world said that banter was more about team owners’ increasing displeasure with Roger Goodell, who has been head of the NFL since 2006. In recent years, Goodell has watched his tenure become rocky over a bevy of problems. Those billionaire owners who want to serve Goodell’s head on a plate may be very well to do so, only in the form of a pizza box instead.

Critics of the NFL this year, including President Trump, have been emboldened over the national anthem kerfuffle that started last year when Colin Kaepernick began taking a knee over what he said was the mistreatment of racial minorities in America. The controversy had almost died down when Trump reignited it by describing such players as a “son of a bitch” during a late September campaign stop in Alabama. In the name of the flag and veterans, Trump and many of his supporters have been gleeful over the NFL’s declining ratings, which have taken another big hit this year.

But the reasons for the slump in NFL viewership is far more complicated - and considering the history of the national anthem at NFL games, that debate is a manufactured controversy anyway. The bottom line is that an ongoing perception, fair or not, is that the quality of play has been terrible - there are really no standout teams this year. Controversies over domestic violence, brain injuries and CTE and they way the league has handled franchise moves to Los Angeles and Las Vegas have soured fans. Plus the league has a technology problem - everyone’s favorite demographic to hype and ridicule, millennials, simply aren’t watching the games as they are happy to just get updates on their phones. That is, if they even pay attention at all.

Back to Papa John’s: The pizza chain’s challenges are more than about the NFL. The company’s messages, on one hand, have been mixed. For example, earlier this year, Schnatter bashed the excesses of executive pay. But the company’s labor practices have long come under scrutiny, to the point the company admitted that such investigations posed a material risk to its business. Rogue franchisees have also been an pesky headache for Papa John’s. Schnatter claims he pays well above the minimum wage, but reviews of the company’s pay and culture are middling at best.

Then, when Schnatter and the company should have just stayed quiet, Papa John’s responded to calls that as a result of the national anthem story, the company had become the “official pizza of the alt-right.” The company quickly took the bait as it issued a public statement that said it did not want racists to buy its pizza. Hence the company burned some bridges while leaving others underwater - not a risk any conventional fast food company should take, considering younger consumers are increasingly buying food products and meals from companies that have some kind of social or environmental mission.

The stubborn fact is that when most companies hit a rough patch, the reasons are almost always self-inflicted - they either embarked on a bad strategy, or did not have the vision to see changing market trends in the first place. And instead of blaming the NFL, the company could just focus on its product, as The Atlantic recently opined.

“Could it be that, instead of ‘Better Ingredients. Better Pizza,’ customers seeking a quick pizza fix now simply have “Better Options”?,” asked Megan Garber last Friday.

Image credit: Paul L. Rivera/Flickr