Papa John's Case Study

In: Business and Management

Submitted By jkalavapudi
Words 1573
Pages 7
The Papa John’s case provides a classic example of a company that entered a highly saturated and mature market and was able to enjoy immense growth and success due to its creative product differentiation strategy. The company’s motto has been consistent from the day the first restaurant was opened: Superior ingredients and a superior product from its competitors. John Schnatter took the basic concept of product differentiation and positioning to new heights as he created a strong global brand, which had an unprecedented track record of success and customer loyalty over its competitor’s pizza products.

This case analysis will examine the company’s initial meteoric growth, leveling performance in recent years while attempting to foreground the challenges faced by Papa John’s and evaluate the strategic options and possible responses to pressures through an evolved product differentiation and growth strategy.

Internal/External Environment & Pressures

Internally, the company had enjoyed astronomic growth since its inception in the mid 1980s, but began to see the impact of a slowing U.S. and world economy in 2008 that began to put pressures on the company’s year-over-year growth and profitability. The time period referenced in the case indicated that Papa John’s in 2007 had 14.8% market share of the $13.5 billion pizza food service market. Despite showing profits each year on its income statement, the year-over-year growth numbers were nowhere near what they were during two decades of operation.

A highly competitive, mature, and saturated pizza market sums up the nature of the external landscape. Given this highly competitive market for pizza service, Papa John’s faced several threats including the following:

New Entrants: Given the low fixed cost of entry, it was relatively easy for small, mom-and-pop pizza shops to open up and…...

Similar Documents

Papa John's Case Analysis

...Ingredients. Better Pizza. Papa John’s. Better Ingredients. Better Pizza. Papa John’s. Papa John’s Case Analysis Papa John’s Case Analysis Table of Contents Appendix2 Exhibit 13 Exhibit 24 Exhibit 35 Exhibit 46 Exhibit 57 Exhibit 68 Exhibit 710 Exhibit 810 Exhibit 914 Exhibit 1015 Recommendations16 Appendix Introduction * Pizzerias represent 17% of all restaurants worldwide. In the United States alone, 93% of Americans eat pizza at least once a month. * Papa John’s Pizza is the number three pizza chain in the world with 6.3% market share, trailing only behind Pizza Hut and Domino’s. * Papa John’s first location opened in 1984 by John Schnatter, who is now known as “Papa John.” He previously sold pizzas from the broom closet of his father’s restaurant. * Papa John’s prides themselves on “Better Ingredients. Better Pizza. Papa John’s.” As a result, Papa John’s focuses on ingredients rather than expanding the menu. * Papa John’s has 628 company-owned and 3,255 franchised establishments in every state in the United States and in 32 countries. * However, the pizza industry has seen changes take place. * Unlike any time in the past, people are more health conscious and worry about what and how much they eat. * Technology has also caused changes in the industry due to social media and smart phone apps being used as a tool to reach customers. * Papa John should recognize......

Words: 3739 - Pages: 15

Papa John's Business Report

...Introduction Papa John’s is a well-established International franchise restaurant chain from USA and it is the 3rd largest pizza company in the world, with headquarters in Jeffersontown, Kentucky, near Louisville, USA. Papa John’s was founded by John Schnatter. When he was a high school student John had a part time job which is working at a local pizza pub in Jeffersonville, Indiana, he felt that there was something missing from national pizza chains which is a superior-quality traditional pizza delivered right to the customer’s door. To fill that void in 1983 John picked up his business degree from Ball State University and later on in 1984, John opened his first pizza restaurant named Papa John’s Pizza and Papa John's has been going strong ever since. Today, Papa John's is the recognized leader of the pizza category and now owns or franchises more than 3,500 restaurants in all 50 states and 29 countries. More than 25 years later, one thing remains the same – Papa John's is still fully committed to delivering on its brand promise of "Better Ingredients. Better Pizza." For 10 out of the last 11 years Papa John's has been rated number one in customer satisfaction among all national pizza chains in the American Customer Satisfaction Index (ACSI). Besides pizza, Papa John’s also serves other menu such as pasta, soup, appetizer and also rice. It may be the same with other restaurants that serve pizza, but in Papa John’s quality is their main priority. In Malaysia, Papa John’s......

Words: 2429 - Pages: 10

Case Study Case Study Case Study

...This case study is an excellent example of how different types of parties can be brought together in a large scale transaction and how the original energy of those early meetings can be lost over time. I imagine that when Anthony Athanas was purchasing those old piers back in the 1960s many, if not all, of his colleagues, friends, and family members told him that he was off his rocker. I’m sure Athanas was looking at this land as his family’s ticket to financial prosperity and somewhat of a legacy that he could leave to his descendants for years and years to come. One of the items I wish the case would have divulged is the amount of money that Athanas had invested in the properties. For me this information would have given an insight to his net worth and how much he had riding on this investment. I assume it was substantial given his actions later in the process. Twenty years later Athanas’ dreams came true and all those naysayers were more than likely green with envy. The amount of pride Athanas’ had in his investment at that moment had to have been insurmountable. Being approached by a big time real estate development company and their extremely wealthy client, Hyatt Corporation, must have made Athanas feel larger than life and made him feel like something he isn’t, which is a developer himself. The case doesn’t give much insight into whether Athanas had any representation or anyone consulting him throughout the process. From the beginning, I saw this as matchup...

Words: 1190 - Pages: 5

Papa John's Case Analysis

...Papa John's In a narrative format, discuss the company from a strategic perspective. Information concerning recent changes in the firm is readily available online and should be accessed. Strategic issues should be discussed in "real time." Papa John’s International was founded in 1984 when John Schnatter delivered his first pizza. The company now has nearly 4,200 locations, with operations in all fifty states and thirty-five countries (About Papa John's). To separate themselves in a crowded pizza market Papa John’s has always stressed a higher-end product by touting their ingredients that results in a superior pizza. The company’s strengths include the aforementioned quality ingredients, as well as an internal commitment to their employees by offering industry leading training programs aimed at providing the same consistent service to their customers. They also have an innovative marketing plan that reaches across the United States, specifically targeted for each location where the store has a location. They have also begun partnership with the National Football League and Pepsi to increase their presence during the 2013 football season through in-game promotions and social media activations (Papa John's Tops NFL Alliance With NFL Network 'Thursday Night Football' Campaign , 2013). The biggest strategy advantage Papa John’s has over their competition is the small amount of capital needed to invest in store location. Each space is designed for only carry out orders cutting......

Words: 1462 - Pages: 6

Papa John's Case Study

...Papa John’s Pizza John Schnatter began selling pizzas out of the back of his father’s tavern in 1983, and opened the first Papa John’s one year later. He began to grow Papa John’s on the ideas of superior customer service, a quality product, and keeping a limited menu. As of 2012, Schnatter has grown Papa John’s to the third largest pizza chain in the world. Over time Schnatter has realized that he must expand his menu to keep up with the other pizza chains. He has also had to keep up with the advancing of technology such as applications for smart phones and online ordering. He has also had to deal with the unstable economy and the recent health craze in the United States. After a thorough examination of the pizza industry, I have put together a complete industry and company analysis to assess Papa John’s current market position and determine its potential for success in the future. In performing this analysis, I have developed three recommendations for the continued success for Papa John’s in the future, and help them over take Domino’s and Pizza Hut as the market share leader. Recommendation #1: Expand Menu to Add Healthier Options * When John Schnatter started Papa John’s, he ran on the business idea of keeping a limited menu; however as he watched other pizza chains add items to their menus, he expanded Papa John’s menu * As stated in exhibit 3, consumers have started to try and eat healthier in recent years * Papa John’s has added chicken and......

Words: 3059 - Pages: 13

Analysis of Papa John’s

...Analysis of Papa John’s I. Brief Introduction/Exec Summary The competitors in the pizza industry seem to have balance and be in cooperation with each other. While there are only a few main competitors, they do not seem to be in a price war. The only way for companies to grow in this industry is to take market share away from already-existing companies.The competitors do not differentiate themselves via price, but rather through different promotions and products ("Papa john's international,").Papa John’s have several strengths which include in-house commissaries and a strong supply chain. They also have a few weaknesses, such as fewer locations than competitors and low switching costs for customers.The purpose of this report is to assess Papa John’s in terms of its overall performance, mission, strategy, and capabilities. Strategy is analyzed from four components, which are goals, products market focus, value proposition, and core activities. At last, performance matrix is used to classify operating performance and organizational health. II. Assessing Firm Strategy Mission and values are very useful to inspire an organization and give it a basic sense of direction and broad guidelines for getting there. According to their web site, Papa John’s has four mission statements for customers, team members, franchisees, and shareholders. For customers, they will create superior brand loyalty, like "raving fans", through authentic, superior-quality products, legendary......

Words: 995 - Pages: 4

Papa John's Case Study

...RUNNING HEAD: PAPA JOHN’S/FACEBOOK CASE STUDY Unit 8: Papa John’s/Facebook Case Study xxxxxxxxxxxxxxx BUS107003016*201002 Week Eight December 6, 2009 RUNNING HEAD: PAPA JOHN’S/FACEBOOK CASE STUDY Papa John’s/Facebook Case Study Papa John’s/Facebook Case Study Papa John’s advertising developed slowly over the years. Papa John’s started out advertising by word of mouth – customer to customer. Papa John’s did not start advertising on television until 15 years after its doors opened and that was 10 years ago. Their word of mouth advertising did not turn into a social networking advertisement until November 2008. Papa John’s strengths are that they are a good pizza place. They are a contender with the other big pizza company names in the market. One of Papa John’s weaknesses was due to the fact that they did not start advertising for many years. Once they did people would say, “I have never heard of Papa John’s”. After a period of time their slogan sticks. They advertise “Better ingredients, better pizzas, Papa John’s”. It is an accreditation to their television advertising campaign that that slogan remains with people. I cannot think of any immediate problems except for the fact that they did not start advertising for such a long period after they opened their doors. I believe that their move to advertise on Facebook was ingenious. Many people on Facebook become fans of almost anything. Becoming a fan of Papa John’s on Facebook......

Words: 550 - Pages: 3

Papa Johns Case Analysis

...Danielle Heyde MGMT 441 Papa John’s Case Papa John’s Inc. Papa John’s has grown exponentially since it was started in 1985, however with management changing hands, and the economy changing there are some issues that lie within the organization. If Papa John’s wants to open 200-300 stores per year they have to do something different. The pizza industry is very mature and becoming saturated so in order to gain a competitive advantage they have to differentiate themselves from others in the industry. Earnings and sales are much slower in industries that are mature than those industries that are emerging. The barriers to entry are very low for the pizza industry, anyone can open up a pizza place which will create a new competitor. Individuals have a lot of choices when it comes to eating out so in order to grow exponentially something needs to set them apart from others since their “better ingredients, better pizza” strategy is no longer holding up. So what can Papa John’s do to set themselves different from everyone else? They can begin by refining their existing product line and expand to different lines. By improving the quality of their existing products and ultimately creating the best pizza possible it is going to take trial and error, ask the consumers what they like/do not like about the pizza. They could begin to expand their lines of service by developing a new chain of restaurants or begin to sell their unique garlic dipping sauce in grocery stores, which......

Words: 593 - Pages: 3

Papa John's

...Introduction Father John's International, Inc. positions as the third greatest pizza chain in the United States, trailing just Pizza Hut (a division of YUM! Brands, Inc.) and Domino's, Inc. The association has collected a chain of more than 2,800 pizza transport and carryout diners working under the trademark "Father John's" in 49 states, the District of Columbia, and 20 worldwide markets. Pretty much 570 of the outlets are association had, with whatever remains of franchised. The firm also foundations around 115 Perfect Pizza diners in the United Kingdom. After the opening of its first store in 1985, Papa John's turned out to be rapidly through the late 1990s previous settling in as a more create association in the following decade. In an outstandingly centered piece of the restaurant business, Papa John's has made sense of how to remove an exceedingly beneficial corner by offering a to a great degree confined menu involving pizza, breadsticks, cheddar sticks, chicken strips, chicken wings, and canned or bundled soft drinks; and by using splendid fixings and touting them in its trademark witticism "Better Ingredients. Better Pizza." Company originator John Schnatter continues holding around a 29 percent stake in the association. Named number one Brand in the Pizza Category in the 2002 Brand Keys Customer Loyalty Awards. The yearly Brand Keys Customer Loyalty Awards regard the associations that "are most undauntedly devoted to making steadfast customers." Father John's......

Words: 337 - Pages: 2

Case Study

...________________________________________________________________________________________________________________ HBS Professor V. Kasturi Rangan and Sunru Yong prepared this case solely as a basis for class discussion and not as an endorsement, a source of primary data, or an illustration of effective or ineffective management. This case, though based on real events, is fictionalized, and any resemblance to actual persons or entities is coincidental. There are occasional references to actual companies in the narration. Copyright © 2009 President and Fellows of Harvard College. To order copies or request permission to reproduce materials, call 1-800-545-7685, write Harvard Business Publishing, Boston, MA 02163, or go to This publication may not be digitized, photocopied, or otherwise reproduced, posted, or transmitted, without the permission of Harvard Business School. V. KASTURI RANGAN SUNRU YONG TruEarth Healthy Foods: Market Research for a New Product Introduction Isabel Eckstein strode toward her office, inhaling the aroma from the test kitchen where the product development team was trying new recipes for TruEarth, maker of gourmet pastas, sauces, and meals. Her team had been working hard for the past year on a fresh whole grain pizza. The final market research results had arrived, and it was time to make a decision on launching the product. In 2006, Eckstein, a brand manager, had led the introduction of Cucina Fresca, a fresh......

Words: 5624 - Pages: 23

Case Study

...CASE STUDY : WOODMERE PRODUCTS John Smith This question was answered on Aug 02, 2012. CASE STUDY : WOODMERE PRODUCTS John Smith had just returned from what may prove to be one of his most important sales calls. John, a sales representative for a top furniture manufacturer, had been meeting with a representative from HomeHelp, a major home decorating retailer. It seems the buyer, Nan Peterson, and the product team she heads had just returned from the annual Council of Supply Chain Management Professionals. At the conference, Nan’s team had attended several sessions on time-based logistics strategies. Even though Nan and her team had just been exposed to the new strategies, they felt it had the potential for significant competitive advantage in their industry. At the meeting with John, Nan explained that HomeHelp is an entrepreneurial company that encourages product teams to try new products and channel relations. The few rules a team has to follow are simple: (1) deal only with manufacturers (no independent distributors are contacted) and (2) keep costs low and service high. The second rule highlights HomeHelp’s basic business philosophy. HomeHelp is a design and home decorating retail chain that follows the warehouse club format. As such, a premium is placed on maintaining low overhead to support an everyday low price (EDLP) strategy. Service is also a premium since HomeHelp targets two distinct customer segments: do-it-yourself consumers, who need special in-store......

Words: 4127 - Pages: 17

Papa John Hbs Case Study

...Case Assignment 1: Papa John’s International, Inc.: Twenty-First Century Growth Challenges Inverted broom closet in a hometown lounge. He called it Papa John’s. Today, there are over 2,500 locations across the North America, South America, Africa, Europe and Asia. While Papa John’s has done a very good job with their forward thinking strategies, there are still some avenues to be explored to keep them competing as one of the world’s best pizza chains. During the first year of the company’s inception, John was able to grow his business from one store to eight, and generate $500,000 in revenue. While Papa John’s may not have had true first movers advantage (Pizza Hut opened in 1958), they did have a distinct advantage when it came to product differentiation. Papa John’s prided themselves on “better ingredients” making a better pizza, which is something they stand by to this day. This selling point is what gave them an advantage over the likes of Pizza Hut, or Dominoes (est. 1967), and made it possible for them to enter the market. One of the early strategic moves made by John was to implement a hub-and-spoke type “commissary” (or quality control center) that was responsible for delivering ingredients, supplies, and dough to a number of stores in the surrounding geographic location. This allowed John to ensure the quality of the food being served. These centers were key to early expenditure and quality control, but would be hard to sustain in future expansion due to......

Words: 1707 - Pages: 7

Papa Johns

...MGT 406 Case Study Papa John International 2007 Identification of competencies The 4 different competences of Papa John’s International include its focus on providing high quality products, operating system, marketing and franchise system. Providing High Quality Products Firstly, Papa Johns’ focus on providing pizzas of superior quality to its customers has laid down the foundation for its success in the long run. Unlike its competitors who focused on cost reduction, Papa Johns focused on differentiating its pizzas. In fact, they were also able to prove in court that they used fresh and better ingredients in comparison to its competitors. This allowed Papa Johns to be rated number one in terms of customer satisfaction among all pizza chains in USA. Applying the VRIO framework, it can be said that this focus provided value to the company owing to its many benefits. Although a restaurant chain selling pizzas was not rare, selling pizzas of such high quality was not common. At the same time, this is not easily imitable by companies because focusing on higher quality will need a major shift from their current procedures and marketing strategies. Furthermore, Papa Johns has been extremely organized in exploiting this competence to its benefit. Hence, as this competence fulfills all the criteria of the VRIO framework, it is both a core and a distinctive competence. Operating System Papa Johns’ efficient operating system is also considered to be one of the competences as...

Words: 2081 - Pages: 9

Papa Johns

...Papa John’s Achieves 10-15% Reduction in Freight Spend in 6 Months Supply Chain Process Platform improved overall visibility, reduced outside storage costs and inventory levels, improved DC efficiencies and transportation utilization, reduced mileage and labor costs. April 16, 2014 When you’re one of the largest pizza companies in the world, with more than 3,000 restaurants, maintaining efficient, cost-effective operations throughout your supply chain is essential to continued success. Even though growth was on the fast track, Louisville, Kentucky-based Papa John’s International, Inc. was still hampered by supply chain inventory, visibility and accuracy challenges that were impacting its businesses. “We were having to use outside storage for inventory that ended up being written off because its shelf life ran out before we could ship it to the restaurants,” says Susan Kinder, director, operations services. “That created a domino effect that caused us to pay too much for everything in the supply chain. But without visibility, we had no way of knowing how those truckload orders were impacting everything else.” The company was also facing what Kinder calls “a perfect storm” of substantial increases in commodity prices, fuel and the minimum wage—three critical elements in the food and restaurant industries. Complicating those challenges were Papa John’s ongoing limited-time consumer offers, which require immediate supply chain responses to temporary spikes in demand.......

Words: 1241 - Pages: 5

Case Study - Papa Gino's

...Group Name | Amazing Duo | Date Submitted | May 13, 2016 | Group Members (Alphabetical order; last name first) | Deleonio, RaemarEustaquio, Grace | Case Study# - Title | Papa Gino's | | | Instructor’s Name | Luke Reyes | 1. What were the problems of Papa Gino’s, Inc.? * The budgeting of the company because it could take up to four months to consolidate and validate data from all the different spreadsheets and complete the process.2. What are the data available that can be used for an analytics solution? * At that time, they had three main business systems: Our Edwards ERP System, the restaurant point- of-sale system and Microsoft Excel.3. What are the possible solutions that can be provided for Papa Gino’s, Inc. to help them solve their problems?: * To create a single central solution that could standardize and significantly accelerate the planning and reporting process. This would allow them to analyze operational performance in areas that they had never previously been able to measure accurately.4. What is the goal of Papa Gino's in turning to analytics as a solution? * Create a team that will assess the company’s existing technology and identify which new system that will help the company’s process * Create a single central business analytics to standardize the business process of the company * Use new system that will consolidate the company’s data * Create a system that will measure the company’s performance such as......

Words: 291 - Pages: 2