Dive Brief:
- Papa Johns’ loyalty members placed 2.5 times more orders than non-rewards members, indicating the strength of the program and the benefit of capturing new members, President and CEO Todd Penegor said on a Q4 2025 earnings call Thursday.
- In the second quarter of 2026, the pizza chain will enhance its app with an AI-powered food ordering agent for voice and group ordering, according to Penegor. Additionally, the app will offer frictionless reordering options for Papa Rewards members.
- “Our loyalty program, Papa Rewards, is one of our most valuable assets, connecting us with nearly 41 million fans and engagement across all customer cohorts, leveraging personalization and exclusive offers to drive urgency, exclusivity and incremental visits,” Penegor said on the call.
Dive Insight:
Papa Johns is investing in its tech stack to improve its app experience and backend capabilities while it closes restaurants and conducts corporate layoffs.
The restaurant chain has reduced its corporate workforce by 7% and expects to shutter about 200 North America restaurants in 2026, followed by another 100 in 2027, according to CFO and North America President Ravi Thanawala.
A portion of the cost savings is being used to fund investments in loyalty, point of sale and personalization to drive customer engagement, according to Penegor.
Papa Johns will modernize its POS and roll out AI-powered labor, inventory and restaurant management systems, according to Penegor. These improvements are expected to work with the app while loyalty changes elevate overall CX.
“Together, these enhanced tools will simplify the ordering experience, reduce cart abandonment, and shorten the path from app open to checkout,” Penegor said.
The changes will build upon recent updates. In the fourth quarter, the company launched new apps for both iOS and Android devices. The updated apps have 40% faster response times and drove a 0.7% lift in conversions, according to Penegor.
Papa Rewards usage has been rising as well. The share of loyalty orders that redeemed Papa Dough points reached 48% at the end of 2025, up from 24% in the prior year, according to Penegor.
It remains to be seen if CX upgrades can improve the company’s sales trajectory. Papa Johns’ North America comparable sales decreased 5% year over year in the fourth quarter of 2025, according to an earnings release. Global restaurant sales fell 1% year over year to $1.2 billion.
