Papa John’s blames Protests for bad sales Justin Gorski, Carlos Munoz, Jake Giffhorn 456 International Financial Management

Its not about pizza Since 2016 NFL players (Colin Kaepernick) have decided to take a knee during the national anthem Silently protesting police brutality & racial inequality More players have joined in after President Trumps comments Some would argue this is the reasons viewers are down

Is it really the NFL’s fault ? “the controversy is polarizing the customer, polarizing the country” “this should have been nipped in the bud a year and a half ago” “NFL leadership has hurt Papa John’s shareholders.” “Good or bad, leadership starts at the top, and this is an example of poor leadership.”

Papa John’s shares fell more than 18% after his comments. Currently Still down roughly 0.94 (1.58%) since John Schnatter spoke out 10/31 Close stock $:68.05 11/8 close stock $:57.50 -18.87% change Papa John’s Stock: 10/12-11/12

In recent news..

Other companies not seeing the NFL as the problem Executives at Buffalo Wild Wings state “the company didn’t expect declining NFL viewership to hurt a key sales figure.” “We’re not seeing impact on any of that on our business”, Greg Creed, CEO of Pizza Hut “Better Pizza, Better Sales,” Digornois Tweeted. “Nothing we reported in the quarter included commentary about the NFL because we saw no reason to call it out.” Domino’s spokeswoman

Decline in sales more complicated then people not watching NFL games Experts say it is facing more competition as other fast-food chains start to deliver burgers and fried chicken, taking a bite out of pizza sales. 1 Pizza companies not the only ones to deliver anymore 2 Another issue: More people are cooking at home 3 Papa John’s puts more money to advertise on NFL games and has fewer advertising dollars to allocate to other consumer segments 4

Questions? Outside of the other factors we have come up with, what else do you think could be affecting their sales? Do you think Papa John’s is to dependent on Advertising during NFL games? After the comments made by CEO do you think Papa John’s marketing strategy will change within the weeks to come?

Sources: https://www.usatoday.com/story/money/restaurants/2017/11/06/papa-johns-condemns-endorsement-white-supremacist-publication/835304001/ http://thehill.com/blogs/blog-briefing-room/news/355588-clinton-on-nfl-players-who-kneel-thats-not-against-our-anthem https://www.si.com/nfl/2017/11/06/papa-johns-john-schnatter-nfl-protests-alexander-ovechkin-putin http://www.businessinsider.com/papa-johns-could-end-nfl-sponsorship-after-anthem-protests-2017-11 https://www.cbsnews.com/news/papa-johns-ceo-blames-nfl-protests-for-poor-pizza-sales/ http://www.chicagotribune.com/business/ct-biz-pizza-nfl-2017110i-20171102-story.html