The Nationals’ and Redskins’ Success: Good for Washington, Bad for Papa John’s?
Sponsorship deals offering discounts for wins can mean paltry profits for the pizza chain.
It’s not that the plan exactly backfired, or that anyone is complaining, but the success of the Washington Nationals—and the potential for success of the Washington Redskins—has been a mixed blessing for Papa John’s Pizza.
This season, for the first time, local Papa John’s franchises offer Nationals fans a real deal. It’s called Nats 50. “When the Nats win by five runs or more, we give 50 percent off the total order,” says Andy Freitas, president of Loudoun County-based Colonel’s Limited, which owns more than half of the 115 Papa John’s stores in the Washington area. The team, so far, has been winning big. In fact, just this month alone, seven winning games have met the five-run threshold. The deal is effective only the day after the winning game and only online.
So is Nats 50 hurting the chain’s profitability?
“We do lose money on winning days, on big days” Freitas says, “but there’s huge transaction growth. There are days when we see a 50 to 70 percent increase in orders.” Unsurprisingly, the surge was overwhelming at first. “We got shell-shocked a couple of times in the beginning, but now our guys know to be prepared. We add more delivery guys.”
Freitas says his company has a sponsorship deal with not just the Nats but the Redskins, Caps, and Wizards, too. “We pay a tremendous amount of money for these sponsorships, and it is worth it. We are hometown owners and are proud to support our local teams.” Domino’s Pizza at one time had a similar deal with the Redskins, but according to a local rep, that fell apart ten years ago over a sponsorship issue.
Football season has only just begun, but the Redskins’ 40-32 win against the Saints last Sunday almost bested Papa John’s generosity. The pizza chain’s deal, called Touchdowns for Toppings, meant that for every TD scored, customers would get a free topping—and a win meant double the toppings. “I saw tweets onscreen during the game that said, ‘This is going to bankrupt Papa John’s,’” says Freitas. Monday, when the deal was in effect, an eight-topping pizza went for only $9.99. The stores were packed, and online orders flooded in. “It was nuts. We were scrambling to get food moved around.”
We wanted to know: If the Redskins have a season comparable to the Nats, and score big as they did last Sunday, could it bankrupt the business? “If they score four touchdowns every single game, and win, it’s going to be a tough fall,” Freitas says. “But it’s an exciting time for DC.”
Like any other fan, Freitas is excited about the possibility of the Nats being in the pennant race—and yes, there is a business angle. “We have something up our sleeves to make it more exciting,” he says. “They are going to go far. But that’s all I’m saying. I don’t want to jinx anything.”