Dive Brief:
- Panera launched its loyalty overhaul nationwide — MyPanera 2.0 — on Wednesday, according to a press release. Members of the brand’s prior program, which had up to 70 million members, will be automatically enrolled in the new system.
- The new program shifts from a surprise-and-delight model to a points-based system with three rewards tiers, Panera’s Chief Digital Officer Joshua Fine said in an interview.
- The change provides consumers with greater value and more choice, Fine said. Tests of the system in three markets drew “terrific engagement” and increased frequency from new and existing MyPanera members alike, he added.
Dive Insight:
The renovation of MyPanera fits into the brand’s ongoing RISE turnaround effort under CEO Paul Carbone. That plan hinges on menu changes, improved value, better customer service and efforts to resume unit growth. The chain is also moving its headquarters from St. Louis to the Boston-area as part of the turnaround plan, and recently hired a new CMO from Cava to help it re-establish itself as a leading chain in the fast casual sector.
MyPanera’s rewards architecture is based around bankable points, with consumers earning 10 points for each dollar spent, Fine said. These can be exchanged for rewards ranging from free bagels and mini-bakery items for 250 points, up to whole entrees for 2,000 points, according to the press release.
The cost to redeem items was based on an analysis of “what our most loyal customers spend at Panera,” Fine said, adding that items with lower-point items are meant to act as an entry to the loyalty system for consumers who are relatively new to the brand.
Like many points-based systems, the new MyPanera offers consumers a fair degree of control over their rewards, especially in comparison to the prior surprise-and-delight model, which operated as something of a black box from the consumer perspective. Fine said shifts in consumer preferences in recent years placed a greater premium on that control.
“Customers want choice. They want to be able to choose what they redeem. They want flexibility,” Fine said. “They want to know that they have a reward to redeem, and they want to be able to choose to redeem it when they want to.”
The chain has tiers baked into its structure, starting with a basic spend-earn-redeem level. Consumers who hit $300 in yearly spending ascend to the MyPanera+ tier, which offers 12 points per dollar spent on delivery orders as well as special perks like a free You-Pick-Two on the customer’s birthday and special treats on the anniversary of a consumer joining the program.
The top tier is the MyPanera+ SipClub, which combines the elevated rewards system with the brand’s subscription drinks benefit, per the press release. MyPanera+ Sip Club also includes Sip Club Saturdays, a benefit that offers a new reward to consumers each Saturday. Fine said this was not limited to drinks, but might include rewards like a buy-one-get-one 50% off discount on entrees.
The chain is promoting its new loyalty system through a media campaign with actress and podcast host Keke Palmer. Consumers who make their first purchase with the new program through Sept. 1 will receive 500 bonus points, enough to redeem a caffeinated Energy Refresher or a Fresca — a caffeine-free, premium carbonated beverage.
