By CultureBanx Team
Papa John’s TV ads now feature a diverse panel of franchisees and employees
Q3 same-store sales are expected to decline down 10% to 11%
America's fourth-largest pizza chain by gross sales Papa John’s (PAPA +0.19%), has launched a new ad campaign in effort to rebuild their brand identity. With restaurant owners facing declining sales, will the new ads they put together with the help of Endeavor Global Marketing CMO Bozoma Saint John reverse that trend?
Why This Matters: Saint John is trying to make the public forget about Papa John’s diversity issues, something that’s highly questionable after the company’s founder slipped up and used the n-word. The first 30-second television commercial featuring a diverse panel of franchisees and employees, will air during prime-time shows including “This Is Us,” and “How to Get Away with Murder.”
What clearly matters most to Papa John's are sales more than sentiment. Third quarter same-store sales are expected to decline down 10% to 11%, according to Stifel analyst Chris O'Cull. He also suggested the pizza chain could close nearly 250 stores over the next six months.
Investors will also be paying close to attention as to whether or not this new marketing campaign is going to be successful, as shares have fallen 18% year to date. Last month Jefferies upgraded its rating of Papa John's stock to buy from hold. The firm also also raised its price target to $58 a share from $52 a share.
It’s important to remember this all started when former CEO John Schnatter got involved in the NFL’s protests against police brutality. Last November, he claimed the protests were affecting pizza sales.
What’s Next: Papa John's is conducting an internal audit on diversity and inclusion practices, launching a program to support minority-owned franchises and starting a foundation focused on local communities. They also plan to roll out mandatory bias training for its workers.
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