Can a new CMO give Papa John's the boost it needs?
- Karlin Linhardt has been named global chief marketing officer of Papa John's after serving eight months as senior vice president of marketing for North America for Subway, according to a news release.
- Linhardt's QSR experience also includes 10 years at McDonald's, where he led initiatives that were part of the brand's turnaround, including kids and family (Happy Meals), value (Dollar Menu) and premium burger products (Big Mac, Quarter Pounder). He has led strategic business and marketing efforts across multiple brand categories that include restaurant, retail, consumer packaged goods, media, sports marketing and entertainment.
- "The addition of Karlin as global chief marketing officer is one of the many significant steps we've taken to improve our brand differentiation, which includes enhancing our quality positioning in the category," CEO Steve Ritchie said in the release. "Karlin's combined restaurant, franchise and consumer brand experience make him an excellent addition to the Papa John's leadership team."
Since Founder John Schnatter's very public fallout last summer, Papa John's has been moving swiftly to turn its roughly 5,000-unit system around. It hasn't been easy. The company ended 2018 with sales down more than 7%. When it was all said and done, Papa John's net income declined $71.9 million in adjusted net income last year.
There is a lot of ground to make up, and Papa John's seems focused on staying the course it has chosen. That course so far has included everything from removing Schnatter's image from its marketing materials, kicking in millions to assist franchisees and hiring its first ever chief people officer. On paper, these moves make plenty of sense, but in practice it has been a costly and slow process. The company anticipates same-store sales will continue to decline between 1% and 5% in fiscal 2019, and analysts expect the chain's recovery to take longer than expected as value and loyalty wars heat up in the pizza space.
In other words, Linhardt has his work cut out for him. But he has deep industry experience — including with beleaguered Subway — and understands the challenging terrain.
Also, Linhardt joins the turnaround as many brand rehabilitation seeds have already been planted. The chain just launched a new loyalty program, for example, and is partnering with athletes and social media influencers for campaigns aimed at improving its image. But the biggest assist comes from the addition of NBA legend Shaquille O'Neal to its board. O'Neal is the first African-American member to serve on the company's board.
Shaq is not only a board member, but also a brand ambassador, signing a three-year marketing agreement with the company worth $8.25 million. He's a savvy businessman who also has restaurant experience, and he's also one of those likable (one-name) celebrities that could provide quite a boon for Papa John's as it seeks a new Schnatter-less identity.
Not everything will be a clean break, however. In the press release, Ritchie noted that Linhardt will contribute to the company's "Better Ingredients. Better Pizza" tagline, which means that's probably not going away in this marketing overhaul. This could pose a slight challenge if the company wants to start anew.
Of course, Papa John's cracks are far too deep for just one person to fill, but the company will be better positioned to move forward with a CMO in the executive suite. The position has been vacant for Papa John's since May. According to the Harvard Business Review, CMOs are primarily tasked with driving sales growth. If Papa John's is to gain any traction at all, sales growth is the best place to start.
- Papa John's International, Inc. / Business Wire Papa John's Appoints Karlin Linhardt as Global Chief Marketing Officer
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