CIMA MARCH 2016 – MANAGEMENT CASE STUDY
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Selling like HOT PIES in an incredibly competitive pizza market.
“Most customer calls start with ‘Do you still have the $10 pizza?” Ravi Ramakrishnan Owner, Papa John’s Pizza - Naperville, Illinois
Papa John’s had never used out-of-home advertising in the Chicagoland area. As a result, they had the point of view that it would be a risk to invest in this advertising medium. However, the pizza business thrives on constant reminders to the customers. If placed in the right location, the 24/7 nature of billboards could be a very effective method in providing that constant reminder.
Papa John’s worked with Clear Channel Outdoor to determine the best location(s) and the right message/design. The client decided upon an offer that could last a long period of time without hurting the bottom line. They advertised “All Large Pizzas for $10”. The food cost is typically high for this type of offer, and Papa John’s hoped for the sales volume to make up for this. They also hoped to increase their online sales that remained at 28% for a long period of time by highlighting “PapaJohns.com” in the ad message.
Papa John’s diligently tracked their weekly sales and online sales during the campaign period. Their online sales had increased from 28% to 35%, and they were consistently averaging over a $1000 in online sales every week. In addition, the client’s coupon redemption report showed that the most used coupon was the $10 coupon created to track sales generated by the billboard campaign.