Panera Bread Wants to Be Everywhere. Panera’s move into dinner could attract new clients. Recently, Panera Bread has announced several new initiatives geared towards expanding its reach-efforts that will continue to unfold as Panera works to gain access to more locations and serve more customers at more occasions.
“This brand comes with 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 people and we wish to keep them.”
Having a wide appeal among consumers and deep relevance among loyal fans, Panera executives see lots of runway for future expansion and a great deal of possibilities to further ingrain the manufacturer into customers’ daily lives.
Much of the brand’s recent evolution has occurred since JAB Holding Company acquired Panera in 2017 for $7.5 billion. Since then, rapid-casual giant has made big news: In April, it rolled out a brand new slate of breakfast menu items geared towards 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 by big coffee houses. In June, the company launched an exam of a dinner menu which includes artisan flatbreads, bowls and hearty side stuff like sweet potato mash. And merely at the end of August, locationsnearmenow.net turned more heads because it finally embraced third-party delivery partners after years of adhering to its in-house delivery program.
So, exactly what do the collective moves tell us about where Panera goes?
“The strategic thread that holds all those things together is it: this brand has a very unique opportunity within our minds in the food and restaurant space to have broad relevance to some fairly broad set of target customers,” Wegiel says. “It’s one of 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 that they believe individual companies and brands really should shape their destiny and destination,” he says. “Unlike various other investment firms they don’t are available in with a playbook and say here’s how you can create value or say here’s the portfolio and here’s where we are able to create synergies …That’s very much the antithesis of methods they operate.”
Panera and third-party delivery? It fits the fast casual’s goal to satisfy customers everywhere.
Still, Panera has had been able to lean on the expertise of sister brands underneath the JAB umbrella-and the other way round. The business owns several coffee concepts, including Peet’s Coffee and Caribou Coffee. Which had been useful when researching approaches to revamps Panera’s coffee offerings, Wegiel says. Nevertheless, JAB urged Panera to strengthen its self-branded coffees, not adopt the banner of some other JAB brand.
Moving forward, Panera desires to create more access points into the brand. For that end, the organization will expand traditional and nontraditional stores. Wegiel wouldn’t share specific store growth projections but says there is “ample room” to add both international and domestic units. Likewise, Panera will go deeper on its lines of consumer packaged goods. Customers can currently find salad dressings, soups, breads, and coffee in supermarket aisles. However the brand thinks it can expand both the number 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 surface.”
Panera has always been a holdout in terms of the third-party delivery services who have transformed much of the restaurant space. The business has offered in-house delivery for years. But 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 or so stores. The brand believes adopting those services may help recruit new clients.
“We’ve experienced delivery for that better part of five-years,” Weigel says. “We realized and heard from your aggregators that there was an entire segment of consumers that wanted Panera, but their primary source or delivery was the aggregators so 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 need for the manufacturer, some of which is very pent up,” Weigel says. “There are areas consumers want us where we’re not.”
“While they might be able to 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 stick to its core brand identity that targets clean ingredients and wellness, as well as keeping its more indulgent bakery and menu items.
“Wellness is not only about maintaining a healthy diet. It plays a part … Someone who is attempting to consume well is generally attempting to balance things,” Wegiel says. “We offer optionality because wellness is about completeness inside the balance of fulfillment.”
A number 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 should be doing that,” he says.
He views Panera’s flirtation with dinner, though, being a bolder move. He recalled the brand’s 2006 introduction from the Crispani, a handmade pizza product available only in the evenings. That offering was intended to push the manufacturer further into the dinner daypart but low sales caused Panera to pull the pizzas in 2008.
“It’s just tough because Panera was known but still is actually a soup, salad, sandwich and breakfast place,” Gordon says. “Dinner is really a substantial daypart on their behalf, but not the top of 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 remain intact.
“While they might be able to get some incremental business at dinner time, it’s never going to be overpowering,” he says. “Once these brand identities are established and known, it just takes forever to maneuver the needle.”
Just like all privately held concepts, Panera’s financial performance is tough to ascertain since its purchase by JAB. But Gordon says the manufacturer still looks strong. It’s a successful operator with a widespread appeal. And Panera enjoys white ypbonx to cultivate its footprint domestically and internationally.
“They have solidified their position in america during the last a decade undoubtedly,” he says. “I have lots of respect for Panera as an operator. In several restaurant brand surveys, Panera shows up high and it has a really strong company operation and franchisee operation.”