Panera Bread Wants to Be Everywhere. Panera’s move into dinner could attract new business. Recently, Panera Bread has announced several new initiatives aimed at expanding its reach-efforts which will continue to unfold as Panera works to gain access to more locations and serve more customers at more occasions.
“This brand has an incredibly high emotional exposure to our target customers,” says Dan Wegiel, the company’s EVP and chief growth and strategy officer. “That’s something that is a massive asset for us and we wish to keep them.”
Having a wide appeal among consumers and deep relevance among loyal fans, Panera executives see a lot of runway for future expansion and a great deal of chances to further ingrain the company into customers’ lives.
Most of the brand’s recent evolution has occurred since JAB Holding Company acquired Panera in 2017 for $7.5 billion. Ever since then, rapid-casual giant makes big news: In April, it rolled out a brand new slate of breakfast menu items targeted at winning share from competitors who frequently offer frozen, microwaved food items throughout the breakfast daypart. That effort included a revamped coffee program that mirrors the quality and technology offered at big coffee houses. In June, the brand launched an evaluation of any dinner menu that also includes artisan flatbreads, bowls and hearty side stuff like sweet potato mash. And simply in late August, locationsnearmenow.net turned more heads since it finally embraced third-party delivery partners after years of staying with its in-house delivery program.
So, exactly what do the collective moves inform us about where Panera goes?
“The strategic thread that holds all those things together is that this: this brand has a very unique opportunity in our minds within the food and restaurant space to possess broad relevance to some fairly broad set of target customers,” Wegiel says. “It’s among the few brands that operates across all dayparts, all week parts and multiple channels of access.”
While those changes came after JAB’s acquisition, he says, the European conglomerate empowered those efforts, not mandated them.
“JAB features a very explicit and clear philosophy they believe individual companies and brands should certainly shape their destiny and destination,” he says. “Unlike various other investment firms they don’t come in having a playbook and say here’s ways to create value or say here’s the portfolio and here’s where we are able to create synergies …That’s significantly the antithesis of how they operate.”
Panera and third-party delivery? It fits rapid casual’s goal to fulfill customers everywhere.
Still, Panera has had had the opportunity to lean on the expertise of sister brands underneath the JAB umbrella-and vice versa. The company owns several coffee concepts, including Peet’s Coffee and Caribou Coffee. Which was useful when researching approaches to revamps Panera’s coffee offerings, Wegiel says. However, JAB urged Panera to strengthen its self-branded coffees, not adopt the banner of another JAB brand.
Continuing to move forward, Panera desires to create more access points in to the brand. For that end, the business will expand traditional and nontraditional stores. Wegiel wouldn’t share specific store growth projections but says there exists “ample room” to incorporate both international and domestic units. Likewise, Panera should go deeper on its lines of consumer packaged goods. Customers can currently find salad dressings, soups, breads, and coffee in food store aisles. Nevertheless the brand thinks it can expand both the quantity of products and the number of distribution points.
“CPG within our minds can be a significant lever of new growth,” he says. “I think we’re just scratching the outer lining.”
Panera has long been a holdout with regards to the 3rd-party delivery services who have transformed a lot of the restaurant space. The organization has offered in-house delivery for years. Nevertheless in late August, the chain announced new partnerships with DoorDash, Grubhub and Uber Eats that expanded delivery choices across 1,600 of the 2,300 roughly stores. The company believes adopting those services can help recruit new business.
“We’ve been in delivery for the better element of 5 years,” Weigel says. “We realized and heard from the aggregators that there was a complete segment of consumers that wanted Panera, however primary source or delivery was the aggregators and that we weren’t there.”
Whether in delivery, a reimagined breakfast menu or CPG options, Panera is working to reach customers across multiple dayparts and occasions.
“We know there’s tremendous interest in the company, many of which is very pent up,” Weigel says. “There are areas consumers want us where we’re not.”
“While they could possibly possess some incremental business at dinner time, it’s never going to be overpowering. Once these brand identities are established and known, it simply takes forever to move the needle.” – John Gordon, principal and founding father of Pacific Management Consulting Group.
While Panera accelerates change, don’t expect any wholesale transformation. The business intends to stay with its core brand identity that targets clean ingredients and wellness, while holding onto its more indulgent bakery and menu items.
“Wellness is not just about maintaining a healthy diet. It plays a part … Somebody who is wanting to eat well is generally attempting to balance things,” Wegiel says. “We offer optionality because wellness is about completeness within the balance of fulfillment.”
A few of Panera’s moves-such as the reimagined breakfast and coffee program-look more routine than transformational to John Gordon, principal and founder of Pacific Management Consulting Group.
“Every good operator ought to be doing that,” he says.
He views Panera’s flirtation with dinner, though, as being a bolder move. He recalled the brand’s 2006 introduction of the Crispani, a handmade pizza product available only inside the evenings. That offering was designed to push the brand further in to the dinner daypart but low sales caused Panera to pull the pizzas in 2008.
“It’s just tough because Panera was known yet still is actually a soup, salad, sandwich and breakfast place,” Gordon says. “Dinner is a substantial daypart to them, however, not the top of the mind daypart.”
To ramp up evening sales, he believes Panera must launch a flagship dinner product. But he thinks the brand’s bakery-cafe identity will stay intact.
“While they might be able to get some incremental business at dinner time, it’s not going to be overpowering,” he says. “Once these brand identities are established and known, it simply takes forever to go the needle.”
Like several privately owned concepts, Panera’s financial performance is difficult to find out since its purchase by JAB. But Gordon says the company still looks strong. It’s a proven operator using a widespread appeal. And Panera enjoys white ypbonx to cultivate its footprint domestically and internationally.
“They have solidified their position in the usa within the last 10 years without a doubt,” he says. “I have a lot of respect for Panera as an operator. In many different restaurant brand surveys, Panera turns up extremely high and contains an extremely strong company operation and franchisee operation.”