(Bloomberg) -- When Papa John's International Inc. announced this week that it was ending its NFL sponsorship, it opted to keep endorsement deals with 22 of the league's individual teams.
But that leaves 10 squads up for grabs.
Now Pizza Hut, which already stepped in to become the league's new official pizza, has to decide which of those orphaned teams are worth pursuing. The list includes the four teams in Los Angeles and New York -- the largest cities in the U.S. -- as well as New England and Oakland, California.
Artie Starrs, who runs U.S. operations for Pizza Hut, confirmed the company is having discussions with “a lot” of individual teams about sponsorships.
“The NFL provides us an opportunity to get into some larger markets,” Starrs said in an interview. “They're strong where we want to grow. We have restaurants in those markets, but we are underpenetrated.”
Papa John's also isn't currently working with the Buffalo Bills, the Pittsburgh Steelers, the Tampa Bay Buccaneers and the Green Bay Packers.
The total list:
- Buffalo Bills
- Green Bay Packers
- Los Angeles Chargers
- Los Angeles Rams
- New England Patriots
- New York Giants
- New York Jets
- Oakland Raiders
- Pittsburgh Steelers
- Tampa Bay Buccaneers
The move by Papa John's to scale back its relationship with the NFL creates a welcome opening for Pizza Hut as it tries to fend off a growing sea of competitors. While parent Yum! Brands Inc. has seen growth at its other brands, Taco Bell and KFC, Pizza Hut has consistently lagged behind in the last two years.
Expanded Delivery
Pizza Hut's push for NFL-assisted growth will complement other measures the chain is taking to woo diners, such as expanded delivery service -- with new thermal pouches to keep the pizzas warmer.
However, there's a reason Papa John's took a step away from these markets, Bloomberg Intelligence analyst Michael Halen said.
“Pizza Hut is scrambling for something,” Halen said in an interview. “Papa John's cherry-picked the good markets, the ones that they liked.”
The big pizza chains, which target middle and low income customers, may not appeal to higher earners in New York and Los Angeles, he said. And while competition from Papa John's and Domino's Pizza in the major markets isn't as fierce, Pizza Hut still has to contend with a host of regional brands and local joints.
Nonetheless, Pizza Hut is upbeat about the deal's broader potential. And the NFL appears happy with its new partner as well, after Papa John's criticized the league for its handling of player protests during the national anthem.
“Pizza Hut has the creativity we are looking for in a partner,” NFL Commissioner Roger Goodell said on Wednesday.
While its agreement with the NFL was just announced Wednesday, Pizza Hut confirmed it had already heard from “pretty much every club.”
To contact the reporter on this story: Leslie Patton in Chicago at lpatton5@bloomberg.net.
To contact the editors responsible for this story: Nick Turner at nturner7@bloomberg.net, Jonathan Roeder
©2018 Bloomberg L.P.
Essential Business Intelligence, Sharp Market Insights, Practical Personal Finance Advice, Daily Fuel, Gold and Silver Prices and Latest Stories — On NDTV Profit.
