Thursday, March 15, 2018

Papa John's

Papa John's
Masen Beatty

The founder of Papa John’s, John Schnatter was fired a few weeks ago. This happened because two months after the sales in Louisville started to decline he blamed it on NFL player protest which occurred during the national anthem. The owner John claimed that his comment were heavily influenced by the Dallas Cowboys owner Jerry Jones, this way Jerry could put more pressure on Roger Goodell the NFL Commissioner. Jerry Jones goal is to have Goodell removed as commissioner. During a conference about Papa John’s earnings Schnatter's comments that were made were constructed as racist, since the protesters in the NFL are predominantly African American. This lead to the stock price for Papa John's to decline.


The company’s stock plummeted and many people went to sell their shares only thinking the price would continue to fall. Papa John’s apologized later saying Schnatter’s comments were not meant to offend people. Also the company said that it supports the NFL players movement to create a change. A few months after Schnatter had to step down as head of the company and Papa John’s was let go of by the NFL, shortly after Pizza Hut became the official pizza of the league.

The company now has more than 5,000 locations and owner John Schnatter is preparing to leave. The pizza chain’s stock has decreased 5 percent since the comments by Schnatter were made about the protests. SInce the beginning of 2017 the stock has dropped 30 percent. This has reduced much of the income for the company and decreased the company by close to $84 million.






Works Cited
Boren, Cindy. “Peyton Manning Dumped His Stake in Denver Papa John's Two Days before the Company Split with NFL.” The Washington Post, WP Company, 7 Mar. 2018, www.washingtonpost.com/news/early-lead/wp/2018/03/07/peyton-manning-dumped-denver-papa-johns-stake-two-days-before-the-company-split-with-nfl/?utm_term=.f0d0fab61260.g g g g g g g g gb b b b b b ba a a a a a a a a a a a a a a a a a a a a a a a a a a a a a a
“Papa John's Drops after Killing Its Sponsorship Deal with the NFL (PZZA) | Markets Insider.” Business Insider, Business Insider, a markets.businessinsider.com/news/stocks/papa-johns-stock-price-drops-after-killing-its-sponsorship-deal-with-the-nfl-2018-2-1017440223.a a a a a a a a a a a a a a a a a a a a a a
Patton, Leslie, and Jonathan Roeder. “Papa John's to End NFL Deal as New CEO Confronts Sluggish Sales.” Bloomberg.com, Bloomberg, 27 Feb. 2018, www.bloomberg.com/news/articles/2018-02-27/papa-john-s-shares-plunge-as-north-america-pizza-sales-decline.
Rovell, Darren. “Papa John's, NFL Make 'Mutual Decision' to End Sponsorship Deal.” ESPN, ESPN Internet Ventures, 27 Feb. 2018, www.espn.com/nfl/story/_/id/22597858/papa-johns-nfl-end-sponsorship-deal.
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30 comments:

  1. I remember when I first saw this story on the news and thinking how ridiculous that comment from him was. First of all, you're just a pizza brand that is affiliated with the NFL so them protesting shouldn't have the kind of effect he claimed it did on Papa Johns stock. And even if it could have such an effect wouldn't you expect Nike or Gatorade to take similar if not greater hits because they work even closer with the NFL and their branding is even featured on the screen every time a player kneels? Oh well though I suppose, pizza hut will now experience the increased sales and I will no longer have to put up with those annoying commercials of Papa John talking with some NFL player about pizza.

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  2. I think it's interesting how one comment made by one owner of a company can send all of their sales into the gutter. This proves that Papa John's is an elastic product because after John had made this comment, consumers decided to switch over to other Pizza options in the area.

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  3. Since the stock of the company plummeted and it can potentially be assumed that their popularity will decrease, people will be willing to pay less for pizza from Papa John’s, and therefore both the demand and supply for Papa John’s pizza will decrease. This has already probably been happening since they aren’t the official pizza of the NFL league.

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  4. It is interesting that the demand went down for the pizzas because of them not being the NFL's pizza. I remember seeing all of the commercials during the super bowl for Papa Johns. After they took their advertising off their sales plummeted and also their stock did too. With the change this decreases their supply and demand of the pizzas and they hurts the business. If this keeps happening, then they will have to closing stores and this isn't good.

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  5. I didn't think anyone would blame the NFL for their sales. Papa John's is a pizza brand that sponsors the NFL but people aren't going to not buy their pizzas just because people are protesting the national anthem before games. Why would the owner think he would be the only one affected of the protesting? I mean, out of countless other sponsors their sales don't go down just because of the protest, their sales would go down because of their product. People aren't going to be thinking about not buying Papa John's pizza just because of a protests the NFL has. It would be a different story if the other sponsors like Nike, Gatorade, and Adidas has their sales going down then it would be safe to say that it is because of the protest, but in this case I think it's just unprofessional and they need to think of something different to attract customers and possibly give them incentives to come to Papa John's.

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  6. It is going to be interesting to see how Papa Johns will now perform as they are no longer the pizza of the NFL. Surely after being released by the NFL, Papa John's will see a decrease in the demand of their pizzas. This is a result of their comments towards the NFL protesters and as they are no longer being advertised by the NFL. Additionally, as the demand of Papas John's pizza will decrease, we will also see a decrease in the supple for Papa John's pizza. This opens the door to other competitors to Papa John's pizza as they can now overtake Papa John's like Pizza Hut has already done.

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  7. It will be interesting to see if Papa John's will have as many sales as they are no longer the pizza with the NFL. While Papa John's is a very well known pizza brand and many people will still buy their pizza even though they are no longer the pizza of the NFL, it's sure to have sales decrease as some people only here of Papa John's from watching the NFL.

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  8. It is crazy to think that just by saying a comment you could lose your job and could decrease the value of a company significantly. Losing their sponsorship with the NFL with set them back especially because pizza hut replaced them and will now be getting more revenue because of it. I think Papa Johns as a company will come back overtime as people buy there product not because what they say but because of their product. There may be a decrease in stock price now but it will come back as they are one of the leading pizza companies in the US.

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  9. This was a very interesting article to read because we have been learning a lot about the stock market in our recent finance classes in Insight. I think it's insane how quickly the price of the Papa John's International stock dropped so quickly because of comments made by the owner. This just shows how quickly stock prices and the overall market can change just by unnecessary commenting. Like I said, interesting article Masen, it will be cool to see where the stock goes once John Schnatter officially is out of the business.

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  10. I wonder if Pizza Hut will now have more sales since Papa John's is no longer the pizza of the NFL. Meanwhile, I am very surprised that one comment would cost someone their job. It really shows how fragile everything is, especially when is comes to political movements. However, now there will definitely be a decrease in demand as well as supply for Papa John's because people won't be buying their pizza! Hopefully this would only be a setback in the short-run and won't affect Papa John's in the long-run.

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  11. I saw this on the news and thought the situation was odd. I would have never thought that a food sponsor of a sports stadium/team would ever blame the stadium/team for a decline in sales. Although on the bright side this opens the door to other competitors to Papa John's pizza as they can now overtake Papa John's like Pizza Hut. The demand for Papa john's pizza is declining and with that the supply will as well as less and less people are purchasing their products. Maybe Papa John's could offer a special promotion or something to gain other consumers and maybe sponsor other teams/stadiums or even other businesses.

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  12. The comments that were made and the reason behind this fall and the reason why John is being fired. It will be interesting to see how Papa Johns can respond to this fall and if they can make a comeback

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  13. Since the stock has decreased this will probably cause the demand to decrease for Papa John's. Not only that but the commentary made is only causing people to go away from Papa John's even more because they are ruining their reputation.

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  14. I'm surprised that such an economic backlash occurred from one innocent comment that was twisted into a racist connotation. When I go to buy pizza, I don't think about much else than eating it, so it surprises me that people care so much about John Schnatter that they would boycott Papa John's pizza.

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  15. I still do not really understand the correlation between Papa John's and protesting, but I think it is really interesting how a business owner's comments can have a huge impact on their company. I do not think that their decline in sales has to do with the protesting, but it will be interesting to see how Pizza Hut's sales are affected and how Papa John's will come back from their hurt reputation.

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  16. It's kind of crazy that Papa John's tried to blame the NFL and the Cowboys for their decline in sales, specifically due to the national anthem protests. As a business owner and representative for his brand, John Schnatter shouldn't have singled any team or players out as it has now affected his stock and likely sales. There are quite a few competitors in the pizza market and Papa John's is giving his competition a break by making comments like these which discourage consumers.

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  17. It is interesting that the economy can be so largely affected by stupid comments made by the owner of chain. These actions and comments hugely hurt their market, and with the large amount of competition in the pizza industry, this could have longer lasting negative effects on the business for Papa John's.

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  18. It's crazy how fast a company can lose support and investment by just a comment. It shows that there is more to running a company than just finances. Especially since Pizza Hut is now the official pizza of the NFL, the stock will probably continue to plummet. This will cause even more investors of the company to leave.

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  19. Wow, it's very interesting how a few comments can change sales and stocks of a massive chain company. I think it's the best move for the company to let go of the founder after his mistakes if they could not be taken care of, after all unless he made a complete turn around sales would likely continue to plummet. I think one thing you could add would be the increase in the competitor's sales after this incident.

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  20. This shows how important it is for businesses to be presented in a good way and to keep a good reputation. Once you give people a reason to give up on or hate your business they will do it. It started by Papa John's thinking that the NFL was the reason for their decline in sales and they made it into a bigger problem by bringing so much attention to it. If they wouldn't have made it into an issue they could've found a way to keep their reputation and advertise or promote better to get sales back up without any drama.

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  21. This is clear evidence of how fragile owning a multi-million dollar franchise can be. By mistakenly saying one bad phrase, a company can go from 100 - 0 really quick. Issues surrounding protests of the national anthem by players in the NFL have sparked a wide variety of controversy and this shows that if an important figure gave their own opinion on a topic, it can backfire if consumers don't agree.

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  22. It is interesting how one comment from someone can have that big of an impact on a company. John Schnatter was the face and image of Papa John’s and how he looks is how the company looks. John Schnatter started to look bad in the eyes of the public because of a so called racist comment. Papa John’s then need to distance itself from him to make their image look better. Even tho John Schnatter was fired the damage was done and stock for Papa John’s dropped and they were dropped as the NFL’s official pizza. One person within a company can do a lot of damage if they look bad in the eyes of the public.

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  23. I agree that papa johns dropped because they had to fire the guy incharge. The charts were up to that time period and that people sold that stocks away.

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  24. There are many things that can come from this topic, but what I think tops them all is the loss of John Schnatter. He is the guy in all those commercials, and I believe he does a good job at selling his product. Now with him out, and not appearing in any more commercials, what will that do to sales? Also, athletes such as Peyton Manning who had shares in the business and were partnered with Papa John’s have also left. So what is going to be the cost of that? Papa John’s now has no big partners, nor does it have their leading actor in all of their 10/10 rated commercials. The impending doom is only growing bigger, and Papa John’s is really going to need to revamp their business in order to get back what they lost.

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  25. This article is interesting for many reasons. The first reason being that the owner of Papa John’s Pizza commented on the movement that happening in the NFL and also that the stock dropped immediately after the comments were made. After all of the comments were made the stock of Papa John’s dropped dramatically. A factor of this is supply and demand. Papa John’s had more than enough supply but no one was demanding there pizza because the customers that buy the pizza were enraged by the comments. Therefore, because of the actions that were made by the Papa John’s Pizza company, Pizza Hut surpassed them and became the new pizza of the NFL.

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  26. Masen: I find this very interesting. It is crazy that someone with that order of business would make a public comment on protesters like that even though the protesters are doing nothing wrong. It is no surprise to me that the demand for the pizzas went down and stocks started to plummet. Being the Pizza of the NFL they had a ton of business and brought in a ton of revenue especially on game days. After this comment on the protesters and Papa John’s being removed and replaced as the official NFL pizza company there will continue to be a decline in demand for the pizzas. We will see the biggest decrease of demand on game days because they no longer will be selling the pizzas at games, and all of the fans looking for a good slice of pizza will now have to buy Pizza Hut at the game instead which will greatly decrease the demand for the Papa John's pizza. Also with John being gone and being their main selling point and advertiser there will also be a decline in sales because he does do a very good job of getting his product out there and does it in a way that is very appealing to the public and without this there may be a decrease in sale because of not as good of advertising.

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  27. It's surprising that a few words can upset the chain that Papa Johns created. The Main person lost his job and Papa John is no longer the pizza for the NFL. This also shows that you can't just blame someone else or a group of people for your company not doing the greatest during a year. With businesses, they go up and down, you can't blame others for your issue

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  28. In today’s society a tweet holds the same power as a loaded gun, and companies can shoot themselves in the foot at anytime. This can be a great example of a demand shift created by tastes of consumers changing not literally but in their idea of a brand is now attached to something negative like Schnatter’s comment. That a byproduct of under performance is due to the NFL protests, which I personally don’t believe to be true, still shouldn’t warrant damnation of John’s pizza. But, that’s just how the world works. Since the good itself is very elastic, and has a lot of substitutes like pizza-hut, such depletion of stock is possible because there isn’t benefits gained from not changing, they’ll lose money. Concluding, this shows the power of likability has on a business success.

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  29. I personally think its ridiculous to pin a decline in sales on people protesting the anthem. For Schnatter to make such inappropriate comments on such a touchy subject is unprofessional and rightfully led to him getting fired. Also, by trying to single out a select group for the companies loss in profit Schnatter probably hurt Papa Johns even more now since their relationship with the NFL is tarnished and will result in further loss of profit for Papa Johns as the stock continues its downward spiral. Overall I don't find it shocking that Papa John's stock plummeted after such unnecessary comments as this is a very sensitive subject, what I do find shocking is that a businessman such as Schnatter could be so oblivious to the comments he was making and expecting no consequences.

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  30. Makeup Comment for 2/29 class: It was surprising for me reading about the founder of Papa John's getting fired for a blame he put on an NFL player protest. Even if he apologizes, it shouldn’t have been said. Just because sales were declining in Louisville, it doesn’t mean that you can put that blame on other things or people. For making the blame, stocks and sales have decreased. For this comment, I think he got what he deserved because he shouldn’t have made such a blame for sales decreasing.

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