Papa John slams NFL for 'poor leadership' after player protests lead to sales slump (PZZA)

  • Papa John's CEO and founder slammed the NFL for the national anthem protest "debacle." 
  • "This should have been nipped in the bud a year and a half ago," he said. 
  • Papa John's relies on its partnership with the NFL for sales, as viewers buy pizza to eat at home.

Papa John's CEO and founder slammed the NFL, blaming the league's "poor leadership" on the pizza chain's sales slump. 

"We are totally disappointed that the NFL and its leadership did not resolve the ongoing situation to the satisfaction of all parties long ago," CEO John Schnatter said in a call with investors on Wednesday. "This should have been nipped in the bud a year and a half ago." 

John Schnatter, Papa John's pizza founder

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John Schnatter, Papa John's pizza founder
NEW YORK, NY - JANUARY 31: John H. Schnatter, Founder, Chairman & CEO of Papa John's International, Inc. rings the NASDAQ Opening Bell at NASDAQ MarketSite on January 31, 2014 in New York City. (Photo by Rob Kim/Getty Images)
INDIANAPOLIS, IN - MAY 24: Papa John's founder and CEO John Schnatter attends the Indy 500 on May 23, 2015 in Indianapolis, Indiana. (Photo by Michael Hickey/Getty Images)
PARK CITY, UT - DECEMBER 06: John Schnatter attends the Deer Valley Celebrity Skifest held at the Silver Lake Lodge in Deer Valley on December 6, 2014 in Park City, Utah (Photo by Mark Davis/Getty Images)
PARK CITY, UT - DECEMBER 05: (L-R) Actress Eloise Broady, John Schnatter and John Paul DeJoria attend the Deer Valley Celebrity Skifest held at the Empire Lodge on December 5, 2014 in Park City, Utah (Photo by Mark Davis/Getty Images)
NEW YORK, NY - JANUARY 31: John H. Schnatter, Founder, Chairman & CEO of Papa John's International, Inc. rings the NASDAQ Opening Bell at NASDAQ MarketSite on January 31, 2014 in New York City. (Photo by Rob Kim/Getty Images)
NEW YORK - OCTOBER 29: Founder of Papa John's John Schnatter speaks onstage at the Spider-Man and Papa John's Pizza's announcement of 'Hometown Super-Heroes' in Times Square October 29, 2007 in New York City. (Photo by Bryan Bedder/Getty Images)
LOUISVILLE, KY - MAY 06: Paps John's CEO John Schnatter attends the 132nd Kentucky Derby at Churchill Downs on May 6, 2006 in Louisville, Kentucky. (Photo by Paul Hawthorne/Getty Images)
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"Leadership starts at the top, and this is an example of poor leadership," Schnatter said.  

On Tuesday, Papa John's reported same-store sales grew 1 percent in the most recent quarter. The company additionally lowered it's North American same-store sales prediction for the year to 1.5 percent, down from 2 to 4 percent. 

According to Papa John's, the chain's weaker-than-expected same-store sales can be blamed on the chain's association with the NFL following players' "polarizing" protests during the national anthem. Schnatter said that Papa John's is in contact with the league, making its concerns known. 

"The controversy is polarizing the customer, polarizing the country," Schnatter said. 

john schnatter papa john'sJason Merrit/Getty

This season, many players have knelt during the national anthem to protest racial inequality and police brutality.

Trump tweeted in late September that players kneeling are "disrespecting our Flag & Country." Many of the president's supporters agreed, canceling NFL TV bundles and burning merchandise.

Declining viewership isn't a new problem for the NFL, as ratings were down an average of 8% over the course of last season. Executives blamed last year's ratings drop — and corresponding Papa John's sales declines — on the election, saying that the company had expected an increase in ratings going into the 2017 season.

Papa John's executives said that while ratings declines certainly hurt Papa John's, the current negative association with the NFL is even more damaging. The company has even cut marketing that emphasizes the partnership, in an effort to avoid being associated with the league. 

The NFL is crucial to Papa John's business. The company began its partnership with the NFL in 2010 and has "Preferred Pizza" partnerships with 23 NFL teams. Last year, the company signed a multi-year partnership with the NFL and the Super Bowl. 

"Our partnership with the NFL, in particular, has been exceptional," Robert Thompson, senior vice president of marketing at Papa John's, told Business Insider in 2016. "One of the reasons the NFL is such a strong marketing opportunity is because of the number of people that watch the games live whether it be at home or in the stadium."

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