On Tuesday night, Papa John’s Pizza finally tweeted an apology, of sorts, for comments its embattled CEO made appearing to blame the company’s below-expected earnings on freedom of speech.
The classically anodyne corporate statement didn’t really apologize for what was said, only expressing regret that the eponymous Papa’s comments appeared to be “divisive.” The statement closed with a middle finger emoji directed at neo-Nazis. Such is the world we live in.
Some background: The Tennessee-based pizza chain, the fourth-largest in the country, has been advertising on National Football League broadcasts since 2010. It would seem a natural fit. A captive audience of football fans, parked in front of their TVs, craving something greasy to soak up the beer. Enter cheap, cheesy pizza. They deliver, too.
Recently, the company’s been on a downturn, with stocks trading at a low not seen since April 2016. By its third quarter earnings call on November 1, founder and CEO John Schnatter was seething. In trying to explain the disappointing earnings to shareholders, he made an off-the-cuff remark blaming NFL leadership, which had allowed players to protest police brutality by taking a knee during the national anthem before games.
For Schnatter, the equation was simple. Because the protests were controversial, some football fans were changing the channel—and that hit Papa John’s bottom line.
“Leadership starts at the top, and this is an example of poor leadership,” Schnatter said, and added that the protests should have been “nipped in the bud a year and a half ago.”
That explanation is probably wrong. Anheuser-Busch, for example, didn’t seem to think the NFL was affecting sales of Bud Light, according to a Business Insider analysis. But the optics of the statement—that Papa John’s didn’t think athletes should be allowed to protest—were really bad, though maybe not surprising. (The Papa has a tradition of expressing seeming disdain for the downtrodden.) In the weeks since Schnatter’s comment, Papa John’s stocks have continued to plummet even more precipitously, at around 13 percent, though analysts aren’t sure whether the comments are to blame.
If Papa John’s is trying to win back eaters by seeming cute, contrite, or just morally sound, it ain’t happening
Why the owner of a pizza chain would think it wise to wade into a highly charged political controversy is one question. The topic is so outside his lane that some have theorized that he’s been roped into a conspiracy to dethrone the league’s commissioner. Still, what was said was said. Which leaves us with a new question: Will yesterday’s apology do anything to stop the bleeding?
Probably not, says Jeremy Robinson-Leon, a brand strategist and crisis expert at Group Gordon. First of all, Papa John’s wasn’t doing so well before the blow-up. And if it’s trying to win back eaters by seeming cute, contrite, or just morally sound, it ain’t happening.
“Given that there’s been a two week lag between the time that those comments were made in the earnings call and the apology—if you can call it that—this is clearly a back-against-the-wall apology,” he said. Part of Robinson-Leon’s job is advising brands on making tough decisions. But this sounded like a no-brainer. “When faced with criticism that is legit and substantial, you don’t wait until two weeks to take action if you really mean it.”
What’s obvious, at least right now, is that the apology isn’t bringing back lost earnings. When the markets closed on Wednesday, stock was actually lower than it had been before the apology. The slide continued, unabated.
It’s possible that the tweet-chain was actually a different kind of damage control. Right after the earnings call, Newsweek reported that white supremacists claimed Papa John’s as the “official pizza of the alt-right.” If that identification had been allowed to grow and fester, things could’ve gotten really ugly for the company. Which is why it’s more likely that the cutesy middle finger was less an apology than the result of a strained, improbable calculation: Lovers of soggy pizza identify more with NFL athletes than neo-Nazis.
If Papa John’s knows what’s good, Robinson-Leon said, it will step away from the controversy altogether. Take Pepsi, for example. When social media piled on a protest-inspired ad featuring Kendall Jenner, the soft drink giant pulled the campaign immediately. Crisis experts said that was the right move. Ultimately, Pepsi ended up reporting a rise in revenue. And no one ever talked about the ad again.
