Panera Bread Co. is implementing a new loyalty program and adding new items to its menu as a way of maintaining high profit and sales growth. While launching its customer-loyalty program, Panera will be adding steak to its sandwiches as a new source of protein for its customers, with extra marketing to accompany its addition to the menu. However, this addition will be putting high commodity pressure on Panera, since beef prices are now at an all-time high. Instead of being reactive to this year's underlying inflation, Panera “stayed true to doing what it did well. And steak is simply a manifestation of that.”
Panera is launching MyPanera cards as part of its loyalty program, which will surely be a factor of great traffic growth. The card allows the company to track its customers' preferences as well as when they buy and how much they spend. This free program presents customers with “soft rewards” such as complimentary items that match their buying habits. Panera has been working on this program for years and states that it is about building a deeper relationship with its customer base. “It lets us talk to them individually and get to know what they like, and what they do, and that is hugely powerful”. Such an incentive is indeed very powerful and is sure to ensure Panera vastly growing sales and profit.
Analysts point out that this kind of insight will be used to make marketing for the company far more effective and influential. Rewards as simple as giving a free bakery item to a customer who usually just orders coffee, Panera is creating the opportunity to establish a long-term relationship with its customers. For instance, it could bring breakfast frequenters in more regularly for lunch and dinner as well.
Adding steak to its menu as well as implementing a new and more powerful loyalty program is sure to attract more customers to Panera in the long run, and will make itself appealing for all three meals of the day. Attempting to create a long lasting relationship with its customer base, Panera is sure to see long-lasting success in the very near future.
http://online.wsj.com/article/BT-CO-20110211-712481.html?mod=WSJ_Hospitality_middleHeadlines
It seems as though these entrepreneurial additions that Panera is instating will be very helpful to the company as well as the customer. Everyone likes to receive free stuff and feel a connection to the place they are going to eat, and this will do just that. I am just wondering about what companies are Panera's competitors. What companies do they need to have an edge over? Overall, this is very innovative thinking, and I am curious to see if other companies begin to use this tactic. Great article!
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