NEW YORK — Louisville-based Papa John’s International is debuting a national loyalty program, hoping that hooking more customers can help it keep up with surging sales at rival chains Domino’s and Pizza Hut, part of Louisville-based Yum Brands Inc.
The loyalty program, called Papa Points, is part of the recent multimillion dollar overhaul of Papa John’s website, where customers place about a quarter of orders. Papa John’s expects that half of all orders will come through its website in the near future, as phone orders take a back seat.
Jim Ensign, vice president of digital marketing, said he doesn’t know exactly when that will happen, but “everything that’s been done so far has been faster than we expected” since Papa John’s became the first pizza chain to offer online ordering in 2001.
Ensign said the investment in online ordering is not aimed at reducing staff in stores: “We really look at it more as an opportunity to employ people in a different fashion and keep them focused on making the pizza.”
Papa John’s hopes nationally expanding the loyalty program, where customers earn points toward free pies based on how much they spend, can yield results that it saw in test markets. Customers ordered more often from Papa John’s and spent more per order as they sought to accumulate points toward a free pizza, Papa John’s Co-Chief Executive Jude Thompson said in an interview last week.
The loyalty program and new website are among the tools Papa John’s will rely on as it and its two larger rivals jostle for customers. Domino’s and Pizza Hut have seen big increases in same-store sales this year amid increased advertising, with Domino’s focusing on a revamped pizza recipe and Pizza Hut highlighting permanently lowered pizza prices.
Papa John’s same-store sales have grown more modestly, 0.4% in its second quarter.
Among the changes to the Papa John’s website is upgrading an interactive feature where customers can see a picture of their pizza as they tinker with toppings. Papa John’s pizza builder displays images that match the specifications of how pizzas are made in the kitchen. Select pepperoni, for instance, and the tool shows all 48 slices that would go on that pizza.
Such attention plays toward Papa John’s position as a higher quality player, Thompson said.
Online ordering has become a growing part of the pizza business. Research firm NPD Group says that 6% of pizza orders were placed online in the past year, more than double what it was three years earlier, making investment in the online ordering platform a key part of keeping customers ordering.
Papa John’s loyalty program is free to customers and gives them one point for every $5 spent when ordering through the website. Every 25 points can be cashed in for a free pizza.