Advertising Age - March 5, 2012

Papa John’s tries to
hold the price of its pies

THIS WEEK

Your guide to highlights from Ad Age and Creativity

While other pizza makers lean heavily on discounts,
No. 3 chain grows sales with mostly modest deals

■ BY MAUREEN MORRISON

mcmorrison@adage.com

IN THE $30 BILLION pizza category, aggressive discounting and price promotion are a way of life. Except at Papa John’s.

The No. 3 pizza chain has been try-
ing hard to hold the line on discount-
ing, instead sticking with its long-held
premium-products-at-premium-prices
message. While leader Pizza Hut push-
es its $10 Dinner Box (one medium
one-topping pizza, five breadsticks and
10 cinnamon sticks), No. 2 Domino’s
markets its new artisan pizzas for
$7.99, and fourth-ranked Little Caesars
continually offers $5 large carry-out
pizzas, Papa John’s has largely resisted
drastic discounts and mostly relied on
milder deals, such as $11 large pizzas.

WORTHIT?

Papa John’s found staking out a premium price means enduring sporadic sales results.

marketers, especially in this economy: How do you gain share without relying on heavy discounting, a move that could harm long-term brand image?

Deep discounting ”doesn’t build loyalty or consistency—it’s cheapening

BRANDS, THE LAW
AND PINTEREST...

See PAPA JOHN’S on Page 19

PAWN STARS
AMERICAN RESTORATION

To bundle, or not to bundle: Mags grapple with iPad subs

Thanks to the newest social-media darling, copyright lawyers will be able to pay their bar bills this month. While Pinterest represents a host of interesting new opportunities for marketers, using it requires some planning, as most images on the internet are not “public domain.” AdAge.com/digitalnext

INSIDE THIS ISSUE

As Sports Illustrated rolls
back last year’s ‘All Access’
price hike, publishers take
stock of tablet sales strategy

How ubiquitous is Facebook? Dale in Teton Cty., Mont., gets mail three times a week but checks the social net daily.

P. 8

From the big desk to the corner office: Steve Cannon talks about jumping from CMO to CEO of Mercedes-Benz USA.

P. 15

■ BY NAT IVES nives@adage.com

STORAGE WARS
SHIPPING WARS

MORE ON ADAGE.COM

FOR PUBLISHERS, much of the digital
revolution has focused on adapting
print content and advertising to inter-
active devices. But once that hurdle has
been cleared, another problem looms:
how to balance pricing between the
two. While that might seem academic,
it’s revolutionary in its own right. As
Monica Ray, exec VP of Condé Nast,
sees it, “The whole industry has the
opportunity to redefine what a sub-
scription is.”
That’s taking some trial and error.
Sports Illustrated, for example, in
January abandoned the price hike it
instituted last year when it gave print
subscribers full access to tablet edi-
tions.

Time Inc. had hoped bundling digital with print under its “All Access” strategy—eliminating print-only subscriptions in the process—would allow Sports Illustrated to increase its price to $48 from $39. But the magazine brand reversed course in January.

“That price, we found, was higher than the market commanded,” said Steve Sachs, exec VP-consumer marketing and sales at Time Inc.

Time magazine, on the other hand, is so far sticking with its own larger increase to $30 from $20.

The biggest divide going in magazines’ strategy for the iPad and other tablets is whether to bundle app editions with print subscriptions or sell each medium separately. The bundlers include Time Inc., Condé Nast and Meredith, which want to retain more print subscribers, charge more where possible and avoid making anyone feel nickel-and-dimed. The other side

MOVE OVER, WHOOPI

Kirstie Alley takes over as the spokeswoman for bladder leakage in new campaign for K-C’s Poise.

P&G CHINA ASKS FOR IDEAS

Procter &Gamble issued briefs to its media agencies in China requesting new ideas, though it’s stopping short of a media review, the company said.

STORAGE HUNTERS

CONTACT AD AGE
AUCTION, PAWN, REPO SHOW?

perators, advertisers negotiating tool

There are more than 30 series in this category across cable. There’s also a growing fascination with swamps, logging, housewives, hoarding and hand-fishing.

Duplicate content isn’t a new phenomenon. It stretches back to Westerns, police dramas, talk shows and reality singing competitions. But media experts agree that the recent reality fad appears more extreme because of the specificity of their content, and that it’s hard to tell one show from another.

The knockoffs typically don’t per-
form as well as the originals. According
to CableU’s study, which uses custom
Nielsen-generated data, over 2 million
viewers watch the prime-time telecast of
the original “Pawn Stars” and “Storage
Wars,” but it tapers off to about 600,000
viewers as you move further down the
list of shows with similar premises.

ADAGE.COM: AdAgeEditor@adage.com.
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Contents copyright 2012 by Crain Communications Inc. All
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