Papa John’s is doing delivery—with a third-party service.
The Louisville, Ky.-based pizza chain on Wednesday announced a national partnership with DoorDash to offer delivery at more than 1,400 of the chain’s locations.
The deal solidifies a partnership that has been in place for months and which made Papa John’s the first major pizza delivery chain to work extensively with a third-party service. It comes as the company has been turning up the heat on its efforts to increase its percentage of digital orders, currently at more than 60%.
The company quietly began working with DoorDash last year in a move overshadowed by the departure of its founder, John Schnatter.
Steve Ritchie, Papa John’s CEO, explained in August that the deal improves service in rural areas, making its pizza delivery accessible to more customers.
“Papa John’s is a mature delivery player with tremendous reach,” Ritchie said, according to a transcript of the earnings call from financial services firm Sentieo. “However, there are still many customers in outlying rural areas, even some suburban developments, who live outside of our delivery zones.”
He said that DoorDash should help mitigate this challenge.
The five largest delivery providers generated nearly $10 billion in sales last year, up 55%, according to Technomic.
That’s still a small percentage of the overall restaurant industry—that amount would be the sixth-largest restaurant chain in the U.S., based on Technomic data. But the growing service has posed a major challenge for existing delivery-based companies, notably pizza, that suddenly see a market flush with numerous, potentially competitive options.
Papa John’s rival, Domino’s Pizza, has taken an aggressive move, with plans to build 2,000 more locations in the U.S., at least in part to improve its delivery times to compete with the services—while insisting that it would not partner with such providers.
But some pizza chains have started working with them, including Pizza Hut. Papa John’s has been the most aggressive, rapidly increasing its partnership—albeit quietly so.
That is changing on Wednesday. To introduce the service this weekend, DoorDash customers can get free delivery on Papa John’s orders over $10 from Friday through Sunday. “This partnership extends our continued commitment to meet customers wherever they are and provide simple, easy ordering for guests,” Anne Fischer, senior vice president of customer experience for Papa John’s, said in a statement.
Papa John’s believes that increasing digital orders is a key element in its efforts to bolster same-store sales, which have fallen for five straight quarters.
“We’re examining the potential for further improvements in our technology, including app capabilities, innovative partnerships and additional ways to enhance the delivery experience for our drivers and our customers,” Ritchie said last month.
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