Papa John's is killing its NFL sponsorship deal after national-anthem protest scandal

Hollis Johnson

Papa John's is killing its official NFL sponsorship deal.

"We will shift our marketing from the broader NFL sponsorship" to focus on specific teams and players, Papa John's CEO Steve Ritchie said in a call with investors on Tuesday.

On Tuesday, the company reported that system-wide comparable sales dropped 3.9% in North America in the fourth quarter. Ritchie said Papa John's took a "hard look" at consumer data and visited with franchisees and operators across the US.

Executives said that "negative consumer sentiment" contributed to the sales slump.

Papa John's sparked controversy in November when founder and then-CEO John Schnatter slammed NFL leadership over players' kneeling during the national anthem to protest racial injustice and police brutality.

With the end of the NFL deal, Papa John's is "redirecting investments" towards new technology, as 60% of the chain's sales are made through digital channels. Ritchie also said that the chain has been "perceived to be too expensive" and will double down on value going forward. The chain also said that it's expanding its menu.

The chain is planning on marketing quality, with "wholesale changes" to creative and media to better communicate its message, including hiring new PR and advertising firms.

"It is not business as usual at Papa John's," Ritchie said.

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