Dive Brief:

• In a recent call discussing quarterly earnings with investors, Papa John's CEO and founder John Schnatter partially blamed the pizza company's poor financial results on declining NFL ratings, as reported by The Drum. The brand is now reconsidering its current advertising situation with the professional sports league, of which it is a sponsor.  
• Schantter suggested the NFL's leaders, including its commissioner Roger Goodell, have failed to resolve the "ongoing situation" of player protests, where athletes have kneeled instead of standing during the national anthem to raise awareness about issues like police brutality.  
• Papa John's apparently isn't an outlier in having these feelings. Linda Yaccarino, head of advertising at NBCUniversal, said that a number of advertisers have made themselves clear that they will no longer want to be associated with the NFL if it continues to be focused on political coverage, per The Drum. She said there's no concrete evidence to directly link the anthem protests to lower viewership, but also few other explanations as to why the numbers are down.

Dive Insight:

Given the current state of the overall TV landscape, there are myriad reasons why NFL viewing is down that extend well beyond politics, including cord-cutting and the rise in popularity of digital streaming platforms like Amazon Prime Video, which is streaming 10 Thursday night games this season. Realistically, almost any other TV show would also kill to get the NFL's numbers, even in a bad year, and brands are still showing up to reach those audiences accordingly. 

NBC Sports Group Executive Vice President of Advertising and Marketing Dan Lovinger just last week said that the network is commanding high advertising sales for next year's Super Bowl, expecting $350 million in revenue — a figure that should ease some of Yaccarino's concerns.

These developments also suggest Schnatter might be flailing a bit to link anthem protests and his brand's association with the NFL brand to a poor sales period for Papa John's, which faces tight competition from Domino's and Pizza Hut, especially in the e-commerce space. Papa John's might also be using the low NFL ratings to help it pivot away from a large TV focus in its advertising. Last week, it named Laundry Service as its new creative agency of record, an interesting pick given the shop's specialties in digital and social media marketing. 

"We're an e-commerce brand — it’s time we stop thinking in TV scripts," Brandon Rhoten, who signed on as Papa John's CMO in June, said in a statement at the time. "Laundry Service's take on content aligns to where we want to go as a brand, and we couldn't be more excited to choose this young, digital-first agency as our new creative partner."

The declining TV ratings for NFL games — whether it’s just a trend or tied to something more significant — are going to become a bigger issue for the broadcast companies that paid for content rights based on a certain level of viewership, as well as brands with longstanding deals in place with the league, which lock them in based on those viewer numbers.