In the latest attempt to try to repair the franchise’s broken image, Papa John’s has turned to former NBA all-star, Shaquille O’neal. Papa John’s took a major hit when leaked recordings of founder and former CEO John Schattner making racist remarks surfaced. Papa John’s has made multiple moves in an attempt to save the struggling pizza chain after it’s stock price took a major blow. Including removing the founder’s face from it’s pizza boxes and other marketing materials and a shitload of commercials attempting to show that the company employed people of every race. Neither really seemed to be helping the company in a major way, but bringing Shaq into the company may be a different story.
CNBC reported, Big Shaq will become the board’s first African-American director. Shaq also grabbed an investment in 9 Papa John’s franchises in the Atlanta area. Shaq also pulled an Oprah when he signed a deal to become the company’s brand ambassador. Shaq will receive $8.25 million for that part of the deal, but just like Oprah, Shaq got half of the $8 milli in company stocks. It’s a gamble, but if something like this pays off, it can pay off BIG. If you don’t believe me ask Oprah Winfrey. She came up like a fat-cat when she took half of her endorsement money from Weight Watchers in company stock. When the stock price made a huge jump, so did Ms. Oprah’s pockets. She cashed out some of that stock and walked away with double digit millions. Much more than she would’ve received had she taken all cash at the time she signed the endorsement deal. If this happens, it will probably be years before the stock price takes such a huge climb, but as long as the company doesn’t go out of business, those stock options are like having money in the bank. As I write this, Papa John’s stock price currently sits at $48.79, up about 4% from this time yesterday. Papa John’s was looking for a way to show some diversity within the company. It cost them some money to get Big Shaq on the team, but I believe Shaq will be well worth the price of admission. People love Shaq. The little jump in the stock price after the company announced the news that they were bringing Shaq onboard showed that. Papa John’s hasn’t even started rolling out the inevitable pizza commercials with Shaq either. Around the time that happens, is when I believe Papa John’s stock will see a jump that will take them above $55/share. That, and come up with some new way of making their pizza or something. Because from looking at my personal Twitter feed, about 90% of people who’ve tried Papa John’s says the pizza is trash. I don’t know, I’ve never had Papa John’s. Have you? Is it trash or is Twitter just overreacting again?
Has anybody had a worse year so far than Papa John’s? It started when the pizza company’s former CEO John Schnatter blamed NFL protest for the company’s weak third quarter sales on the NFL players’ protest over police brutality, and now it ends like this. Forbes Magazine (@Forbes) reports, less than 24 hours after Papa John’s benched itself as the NFL’s official pizza sponsor, the NFL cut a deal with Pizza Hut to become the league’s new pizza sponsor.
The NFl and Yumi Brands subsidiary made the announcement this morning. The deal with Pizza Hut will officially begin during this year’s 2018 NFL draft in April. The deal gives Pizza Hut exclusive marketing rights, use of the league’s 32 team logos and any other designation that will connect Pizza Hut with the NFL’s players, events and properties. The deal is big. That means we will no longer be seeing a barrage of corny Papa John’s commercials starring Peyton Manning during this upcoming NFL season. Those will now be replaced by Pizza Hut commercials. Many people on social media have complained that Papa John’s pizza is trash. I’ve never tasted Papa John’s pizza before, but if it’s true that the pizza is trash, and you combine that with a lack of advertisement, my guess is that it won’t be long until Papa John’s goes completely under…unless their pizza stops being called trash and they grab another huge sponsorship with another sports league. It will be hard work to find an audience bigger than the NFL’s though.
So……Papa John’s has finally realized that the minority dollar holds lots of power. Like most big companies, Papa Johns underestimated the value of the minority dollar. Papa Johns was clearly under the impression that minority customers did not make up a huge portion of the company’s profits when they came out a few weeks ago and claimed NFL players protesting police brutality was hurting their sales. Papa Johns obviously felt emboldened enough to make this statement, because they thought that minorities did not make up a huge portion of their sales. What other logical explanation is there for Papa John’s speaking out so forcefully against a non-violent protest of police brutality? Papa John’s decided to go the Trump route and claim that the protest were so disrespectful to everything they stood for. Maybe Papa Johns really believes that, or maybe Papa Johns were trying to play to what they thought were their core base of customers. Either way, Papa Johns must be starting to get a little low in the pockets after their comments, so what do you think Papa Johns did? Took to Twitter in an attempt to walk back their protest comments and hopefully clarify where they stand.
It might be a little too late to try to walk back those statements Papa Johns. Many people were already speaking about how bad your pizza was, and now, after your comments, those that actually liked your pizza seem to not be buying it anymore. That’s what happens when you underestimate the power of the minority dollar. These companies only seem to realize that the fake narrative that “minorities don’t spend lots of money” is false once their businesses start to hurt after offending minorities. Papa Johns is about to learn this lesson the hard way. Those people that were cheering you on for your ridiculous comments about NFL players protesting hurting your business, were not your customers. They said they were, but you can see that they weren’t. Just take a look at your bank account.