Monday, November 7, 2011

A New Type of Loyalty: MyPanera

A few months back, when the cashier at Panera asked me if I was part of the MyPanera program I cringed at the thought of my wallet getting any thicker by adding another loyalty card.  But like most other entitled Panera purchasers, I wanted to be rewarded for the significant amount of cash I spend on my You-Pick-Two’s, so I signed up.

A few days later when I was prompted to fill out my profile online, I kept looking for the points converter.  Was this like their Cosi competition where every tenth meal is free? Or, could this resemble the Starbucks model based on the ever-exclusive Gold Card? The answer: neither.

Panera created a loyalty system based on two key insights: Surprise and Delight.  The MyPanera program has no publishable points system.  Every time you go, you swipe the MyPanera card and sometimes you’ll be surprised with a treat.  As a marketer and Panera-loyalist alike, I was skeptical of this program.  Would this work to create loyalty? Would consumers grow frustrated by the lack of structure? Most importantly: how does this benefit the customer?

However, I am now quite the fan, and it seems that Panera customers are for the most part, quite thrilled.  With the recently announced Q3 results, Panera’s revenue increased 22 percent from the previous year. The CEO attributed some of this success to the increase in customer loyalty.  In fact, in one year, Panera was able to attain 8.3 million registrants for the program. 

There was also some negative whiplash.  Customers complained online that Panera did not understand their purchase decisions.  In fact, one outraged customer said that the program never rewarded with the types of food purchased, instead attempting to buy other menu items.  Panera responded that over the year the program has been course corrected, and is working to continue surprising and delighting customers. 

My advice, keep doing what you're doing, Panera.  For those who are not yet members, go ahead, sign up.  You might surprise yourself.

By Hillary Grey
Twitter: @hgrey 

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