#169: Panera Bread Shares Subscription Insights - its Powerful, Disruptive Approach to Customer Loyalty.

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PAULA: Hello, and welcome to episode 169 of Let’s Talk Loyalty, where I’m excited to be chatting with a truly disruptive brand in the loyalty industry.

PAULA: Many of you will be aware of the incredible interest created when Panera Bread launched one of the first loyalty subscription programs using a subscription model for unlimited coffee.

PAULA: Now for anyone listening who’s not familiar with the brand, Panera Bread is an American chain of bakeries and cafes with over 2000 locations throughout the country.

PAULA: And I also found out it also has one of America’s largest loyalty program memberships.

PAULA: I’m joined today by Meenakshi Nagarajan, Senior Vice President of Recurring Revenue and Loyalty at Panera Bread.

PAULA: So I hope you enjoy our conversation all about subscription style loyalty.

PAULA: So Meenakshi, first and foremost, welcome to Let’s Talk Loyalty.

MEENAKSHI: Thank you, Paula.

MEENAKSHI: Thank you for having me.

MEENAKSHI: It’s an honor to be a part of this conversation where it’s really digs deeper into loyalty, and it’s a field that I’m clearly very interested in.

PAULA: Oh, for sure.

MEENAKSHI: You bring a lot of great examples, something that the community can learn from.

MEENAKSHI: Thank you for having me here.

PAULA: Oh, I’m delighted.

PAULA: I think what we discovered, Meenakshi, actually just talking before between us was a shared love of learning.

PAULA: And there seems to be very much a hunger from everyone, I think, maybe at our level.

PAULA: We just really want to do good work and there isn’t enough information out there.

PAULA: So definitely, I know the audience can be super excited to hear all about Panera Bread.

MEENAKSHI: Yeah, likewise.

MEENAKSHI: I’m excited to get into this discussion and share some of the great brands that I’ve been part of and really talk through where we’re going next, because I do think loyalty is such a fast-evolving place.

MEENAKSHI: And it’s crossing over industries very, very rapidly.

PAULA: Yeah, for sure.

PAULA: And what I liked about what you talked about before with Meenakshi is you used the word disruptive and definitely what Panera Bread is doing is disruptive.

PAULA: So I think I’ve mentioned subscription loyalty to practically everyone I’ve spoken to on this show.

PAULA: And I think Panera Bread is very much the industry leader.

PAULA: So I’ll be dying to get into all of that.

PAULA: But listen, before we start talking about all the exciting work you’re doing, tell me your favorite loyalty statistic, please.

MEENAKSHI: Yeah, the favorite loyalty statistic, you know, it stood out to me once when we think about growing brands, when we think about really thinking, how do we bring more customers into, whether it’s restaurants, whether it’s CPG, we always focus on who’s the new customer that we’re gonna go acquire.

MEENAKSHI: But there was a study that was done, I think by Bain Group, and it’s been repeated a few times, that talks about just a small 5% increase in customer retention, actually can add your overall profitability by up to 50 to 70%.

MEENAKSHI: And that to me is very powerful and really goes into the heart of why loyalty exists and how you think about structuring programs, which is not just focused on getting new customers in.

MEENAKSHI: And I think that’s really important, but also giving another reason for your existing customers or someone who’s given you one try to come back again, try to engage with that.

MEENAKSHI: So that small increase in retention actually has really big, substantial profitability business impact.

MEENAKSHI: And it’s important to keep that in mind.

PAULA: Yeah, it’s the perfect one to open with Meenakshi.

PAULA: I think, you know, maybe senior management haven’t had the same level of exposure to loyalty statistics as those of us, obviously, who love to talk about it like we do.

PAULA: And you’re absolutely right, Bain did that research.

PAULA: And when we released this show, actually, I will just have released an episode as well from Bain, from the man himself, Fred Rykeld.

PAULA: And he used a great term, Meenakshi, and I know you’re going to love it.

PAULA: But he basically, he quoted Tony Shea.

PAULA: I don’t know if you ever came across the former CEO of Zappos.

PAULA: Yes.

PAULA: Of course.

MEENAKSHI: Yeah.

PAULA: And what apparently Tony used to say, Meenakshi, and it’s exactly the point that you’re making.

PAULA: He basically said that, you know, the cost of acquiring new customers, if you have to spend money to acquire them, is like a tax for not retaining your customers in the first place.

PAULA: And I mean, what incredible clarity, you know, it’s just exactly what you’re saying.

MEENAKSHI: Yes, absolutely.

MEENAKSHI: And I love that, that you spoke to Fred.

MEENAKSHI: I’ll be curious to get into that because I think he was the one who created the whole Net Promoter Score idea too.

MEENAKSHI: It all comes down to that customer engagement, customer experience and in today’s world, right?

MEENAKSHI: It’s more about when it’s so hard to break through and someone’s actually given you a try, like how do you make sure that you bring them back in?

MEENAKSHI: The cost of retention has to be a strategic one and really that is the crux of why companies invest in loyalty programs and drive that engagement.

PAULA: Yes.

PAULA: And your background is absolutely perfect as well.

PAULA: I think coming from a digital background, particularly your time with Domino’s, so tell us a bit about your career and actually over the last maybe 10 or 12 years.

MEENAKSHI: Yeah, happy to.

MEENAKSHI: After I started my career more in terms of data and strategic consulting, I went into a business school and then I wanted to switch into brand marketing.

MEENAKSHI: And because what appeals to me is really how do you take a customer insights and take something which could be a commodity and really drive that engagement with customers.

MEENAKSHI: And it’s very much about unlocking insights and driving value from that.

MEENAKSHI: And that’s what a brand is.

MEENAKSHI: So, you know, and I started off with in the CPG world, I spent a few years at General Motors and Pepsico.

MEENAKSHI: But then I switched to the restaurant world.

MEENAKSHI: That takes another level of brand experience and hospitality.

MEENAKSHI: And there’s so much to learn from.

MEENAKSHI: And to your point, I spent about six years at Domino’s.

MEENAKSHI: And I’ve been with Panera for seven months or so.

MEENAKSHI: And prior to that, I had a brief stint at Sweetgreen.

MEENAKSHI: So different scaled restaurants, but at the end of the day, it’s all about hospitality and really being true to what you’re offering and what your brand promises.

PAULA: Yeah, for sure.

PAULA: And again, Sweetgreen is a gorgeous brand.

PAULA: Domino’s is just so incredibly impressive.

PAULA: And actually just for listeners, and I’m sure you had this very regularly, I remember reading that Domino’s describes itself as a technology company, which is incredible when you think about, as you said, we consider it as a hospitality business, but digital and everything you were doing, you were a director of digital in there, Meenakshi, am I right?

MEENAKSHI: Yes, I did.

MEENAKSHI: I spent about five and a half years.

MEENAKSHI: I held a few different positions, everything from brand positioning, product innovation, but I also spent a year or more kind of leading all of our digital marketing efforts there.

MEENAKSHI: And it is really about thinking about what Domino’s offers, right?

MEENAKSHI: It’s first and foremost, it’s convenience and digital was a way to disrupt that, was a way to think about taking convenience to that at most need and what better way to do that than using technology.

PAULA: Yeah, absolutely.

PAULA: So tell us then, what was it that tempted you to Panera Bread?

PAULA: Was it this disruptive innovation of subscription?

MEENAKSHI: You know, when I will say when Panera launched its loyalty program, I was at Domino’s and we looked at it with Envy because they did such a great job in terms of being a pioneer in launching our loyalty program.

MEENAKSHI: And in this world of where there are so many different ways to go as to what a loyalty program is and what a brand is, I think Panera has had a very clear point of view.

MEENAKSHI: And we’ve been a pioneer both in terms of talking about fresh, clean ingredients, talking about technology, talking about loyalty as a program, talking and having an app, which makes it more convenient.

MEENAKSHI: To me, Panera brings a lot of what I have done at different places into one big package, which I really believe in.

MEENAKSHI: Okay.

MEENAKSHI: It’s at a scale where we are able to make a big difference.

MEENAKSHI: I believe we are one Panera to drive a healthier, happier world.

MEENAKSHI: That’s the purpose that drives me and motivates me.

MEENAKSHI: And on to your first point of wanting to learn and continue to challenge ourselves, I think at Panera, we’re trying to do things which is disruptive.

MEENAKSHI: It is about finding things that hasn’t been done before.

MEENAKSHI: It is about writing our own playbook.

MEENAKSHI: It’s a challenge where you continue to learn and figure it out.

MEENAKSHI: And I’m excited to be a part of that.

PAULA: Well, I just have so much admiration for you for taking on that challenge.

PAULA: And for the whole company, obviously, as you said, when we do have these conversations now about subscription loyalty, everyone’s pointing to Panera Bread.

PAULA: And to also, you know, Pret a Manger in the UK, which I know is a sister company, and also Espresso House in Scandinavia.

PAULA: So clearly the strategy for you guys has worked well enough to translate across multiple markets.

PAULA: But literally, when this started, I mean, can you share the story?

PAULA: I know it was before your time, but where did this idea of subscription come from for Panera Bread?

MEENAKSHI: Yeah, so the idea of subscription comes from something more basic, honestly.

MEENAKSHI: I think it’s really thinking about what can we do to drive absolute value?

MEENAKSHI: Coffee is, for instance, we have premium coffee, and we had stats in terms of how much customers end up spending on coffee.

MEENAKSHI: And how are we able to offer something that could be disruptive value in a way that makes it a no-brainer, makes it so approachable?

MEENAKSHI: And coffee is a habitual thing, right?

MEENAKSHI: People want coffee to energize them, to start their day.

MEENAKSHI: And how do you combine this, something which is a small habit, and Panera is able to bring a unique offering.

MEENAKSHI: It’s not just coffee, right?

MEENAKSHI: Coffee usually goes with great pairing of food.

MEENAKSHI: And we have an incredible area of variety of food, and that’s something that our guests could have, their daily habit of coffee, but along with the food offering that we have.

MEENAKSHI: So it’s thinking about that guest ritual, and we have so many guests who are coming in, and really thinking about how can we package it up that makes a lot of sense for our guests, but as well as for our franchisees and our company.

MEENAKSHI: That’s where the idea of subscription came about.

MEENAKSHI: And clearly at 8.99 a month, you can’t beat the value, right?

MEENAKSHI: If you come in every single day, it’s almost like 30 cents a cup of premium coffee.

MEENAKSHI: But we also see that it does make Panera top of mind.

MEENAKSHI: It does help them come in to our cafes or through our digital ordering, be able to pick up any other food pairing that makes that occasion a more substantial and a significant one.

PAULA: Yeah.

PAULA: And I think what really strikes me as genius, actually, Meenakshi, is the positioning of Panera Bread is beautiful because it is around being a bakery.

PAULA: So I suppose it’s very clear to your customers that they can come for lunch and they can come for all those beautiful baked goods.

PAULA: So I guess to build the association with coffee and then obviously the temptation to come and stay for lunch, have the croissant.

PAULA: I mean, it’s actually almost a repositioning exercise in my mind at the same time, the way you’ve done it.

MEENAKSHI: Yeah.

MEENAKSHI: Yes.

MEENAKSHI: Bread, as we say, bread is our superpower.

MEENAKSHI: Oh, lovely.

MEENAKSHI: It’s freshly baked in our cafes.

MEENAKSHI: And to your point, when you think about coffee is a daily habit and you come in and now you pick a bagel with it or you get a sweet treat if it is an afternoon coffee.

MEENAKSHI: And we’re able to provide all of that very uniquely than anyone else.

MEENAKSHI: So it’s really utilizing what we already have and making this engagement with our guests through the subscription a much tighter one.

PAULA: Okay, yeah, yeah.

PAULA: No, you’re absolutely right.

PAULA: And for listeners who might not have done quite as much geeking out about me as me about the program, I’m just going to quote a couple of statistics, Meenakshi, that came out, I think quite soon after you launched the proposition.

PAULA: And it was CNBC who, among others, I know USA Today and all the big publicity channels were super excited about this.

PAULA: And again, because it’s so innovative.

PAULA: But just for listeners, the visits, for example, increased from four on average to about 10 per month.

PAULA: So obviously just driving the footfall more than double.

PAULA: The food sales increased.

PAULA: So 70% of your subscribers increased their purchase of food.

PAULA: And then the renewal rates were quoted at between 90 to 95% So I think that just demonstrates the value point that you made and just the overall proposition just totally landed for people.

MEENAKSHI: Yeah, and subscriptions in general are about creating that virtuous cycle, right?

MEENAKSHI: You make this value so incredibly easy to understand.

MEENAKSHI: And with that simplicity, our guests come in more to evoke that.

MEENAKSHI: And each time they do that, there is more opportunity for them to buy other Panera products, which is what is about that attachment sales, as we call it.

MEENAKSHI: And it’s also an increased frequency, right?

MEENAKSHI: It’s traffic, it’s attachment sales, and it’s that disruptive value in the offering itself of coffee.

MEENAKSHI: And those three work so well together, and that is what is the unlock of the subscription.

PAULA: Yeah.

PAULA: And do you think there was a lot of concern by the, you know, I suppose whoever had to put the initial P&L together, as I said, with nobody to look to for inspiration.

PAULA: I cannot imagine how the numbers were being worked out.

PAULA: But again, when people talk to me about, you know, whether or not they should, you know, launch a subscription program, their big concern is always around dilution.

PAULA: And again, the press release that you guys issued in the beginning, what I loved was it shares the insight, which you actually already alluded to Meenakshi, which was this idea that there’s a lot of guilt associated with, you know, expensive coffee.

PAULA: And the average American was being quoted at spending, I think it was $1100 a year on coffee.

PAULA: So, you know, take a subscription package, save yourself $1000 a year.

PAULA: But obviously that’s $1000 that perhaps Panera Bread could have been expecting.

PAULA: So I can imagine between all of the various decision makers, there must have been a massive amount of debate just to kind of get it right in the beginning.

MEENAKSHI: Yeah, and you’re very astute to have observed that.

MEENAKSHI: It is, you know, while when you think about it now and you look at the results, it feels like, of course, we should be doing it.

MEENAKSHI: However, there is a notion of understanding the customer behavior and who is the one who is coming into our subscription program.

MEENAKSHI: How do we continue to grow that?

MEENAKSHI: And how do we bring our stakeholders along the journey?

MEENAKSHI: For us, it’s, you know, it’s our franchisees, it’s our head coaches or our company, cafe operators need to understand that there is value that they may not be seeing on an everyday basis.

MEENAKSHI: When someone comes in and redeems their free coffee in their mind, it might feel like, well, what’s the sales associated with it?

MEENAKSHI: And it is about bringing it back and showcasing the economics of it on a very regular basis from a different viewpoint, from a customer level profitability, from a program level profitability, and also from a category growth, right?

MEENAKSHI: Like now, if you think about coffee sales in general, what is that spurring, right?

MEENAKSHI: Yes, to your point of yes, there might be cannibalization, but what is this foot traffic driving?

MEENAKSHI: What part of our menu is now getting a lift because of our coffee subscribers, for instance?

MEENAKSHI: So being able to call out different parts of the P&L and really understanding from an operator standpoint or from our franchisee standpoint as to why this program is something they should get behind was a big part of our internal discussion.

MEENAKSHI: And it continues to be the case even today.

PAULA: Yeah.

PAULA: And I didn’t realize it was a franchise based business because all of a sudden that means you do have thousands of decision makers.

PAULA: And again, it has to be a nationwide proposition.

PAULA: So you actually, you know, you have to convince every single one to get behind the concept.

MEENAKSHI: Yes.

MEENAKSHI: And it is about bringing them along in the journey.

MEENAKSHI: Right.

MEENAKSHI: We did test this first in Pew Cafe.

MEENAKSHI: So we have to have to make sure that the concept works.

MEENAKSHI: And to your point, this hasn’t been done in restaurants at this scale.

MEENAKSHI: Yeah.

MEENAKSHI: And, you know, and to think about how is how are our guests going to take to it?

MEENAKSHI: How is that going to affect the PNL?

MEENAKSHI: And how much can we support?

MEENAKSHI: Right.

MEENAKSHI: Ultimately, it has to be destructive value for people to commit to their dollars, even if it feels like a no brainer when you do the math.

MEENAKSHI: Yeah, there is a barrier of somebody giving in their totally in their nine dollars.

PAULA: Yeah.

MEENAKSHI: The month.

PAULA: Yeah.

PAULA: We certainly used to use the term.

PAULA: And I worked with a couple of guys, I think, you know, in in liquid barcodes.

PAULA: And we used to say we called it extreme loyalty because, you know, when I’m kind of talking about loyalty, it’s one thing to have permission to market to somebody.

PAULA: It’s another thing to have all of their data, you know, so you can personalize.

PAULA: But, you know, the holy grail is, you know, I’ve got your credit card and I got this opportunity to keep charging.

PAULA: And so, yeah, I think that’s actually what you guys have achieved.

PAULA: And again, nailed the price point again.

PAULA: I’m sure there’s massive debate about, you know, that eight dollars, ninety nine.

PAULA: Is it fifteen dollars?

PAULA: Is it two?

PAULA: I mean, it’s such a big decision.

MEENAKSHI: It is.

MEENAKSHI: It is a big decision.

MEENAKSHI: And a lot of it goes down to what we talked about understanding the usage pattern.

PAULA: Right.

MEENAKSHI: Like you said, it was four before and then it became ten.

MEENAKSHI: But just really making sure that we’re able to provide value to most customers and bring in, make it as approachable as possible.

MEENAKSHI: And also thinking about it, right, this is we see it as our loyalty program.

MEENAKSHI: My Panera gives you access to this to the subscription program, which is such a disruptive value.

MEENAKSHI: And so as we think about overall construct of our loyalty, it is a personalized reward journey.

MEENAKSHI: That’s what Panera is, right?

MEENAKSHI: It’s not a very set earn and burn or these many points and you get a set reward.

MEENAKSHI: It is a very personalized rewards journey.

MEENAKSHI: And when a subscriber comes into that, how do we make sure that we’re utilizing their data that we do get in a smart way that helps our coffee subscriber as much as our overall loyalty program?

PAULA: Yeah, yeah.

PAULA: And another point I’m just thinking about, again, conversations I’ve had, Meenakshi, I think one of the things that people struggle with is how prominently should we show the opportunity to unsubscribe?

PAULA: Because I have paid a lot of attention and I think we have all had the experience where there’s, you know, buyer’s remorse or, you know, I forgot to cancel that.

PAULA: And, oh, no, I’ve spent another month and I’m annoyed.

PAULA: So, you know, fundamentally, as loyalty professionals, that would be very upsetting.

PAULA: But at the same time, what you don’t want to be doing is, you know, making it too easy.

PAULA: So, so did you do you guys have to think through that?

PAULA: Or do you think the value piece just means that people are very clear in terms of staying or going?

MEENAKSHI: Yeah, I think it is a it’s a great discussion point.

MEENAKSHI: And we just led here by what we want to be.

MEENAKSHI: Right.

MEENAKSHI: We want to be a transparent company.

MEENAKSHI: We want to make sure that it’s a it’s a long term relationship that you’re getting in with somebody.

MEENAKSHI: So it’s very easy.

MEENAKSHI: We are very good at reminding somebody that your your renewal time is coming up.

MEENAKSHI: And and this is how much you have signed on.

MEENAKSHI: And this is when, you know, we’ve we’ve run a few trial offers, for instance.

MEENAKSHI: We make it very clear that it’s coming up.

MEENAKSHI: Here’s your chance to renew.

MEENAKSHI: And if not, then it is easy enough to cancel.

MEENAKSHI: Ultimately.

MEENAKSHI: Yeah, I do really believe subscriptions work when they find value in it.

MEENAKSHI: And that comes from redemptions.

MEENAKSHI: Yeah.

MEENAKSHI: It’s not just about and we all do that.

MEENAKSHI: I mean, everybody has it.

MEENAKSHI: I think the number is somewhere around seven subscriptions.

MEENAKSHI: Everybody is signed on to.

MEENAKSHI: And a lot of times you forget about it because it’s totally just.

MEENAKSHI: And then you look at it after six months and you’re like, oh, my God, what happened?

MEENAKSHI: Yeah, we don’t want to be that.

MEENAKSHI: It’s about finding value.

PAULA: Yeah.

MEENAKSHI: And so and that’s what is I think redemption is the best way for retention when it comes to a subscription.

PAULA: Love it.

PAULA: Love it.

MEENAKSHI: So how do you make sure that we did we remind you there is a there is a free cup of coffee waiting for you.

MEENAKSHI: And it’s a little nudge.

MEENAKSHI: And that helps them come in and get that.

MEENAKSHI: It’s not hidden.

MEENAKSHI: It’s not.

MEENAKSHI: We don’t make it very complicated to try and cancel if you do choose to.

PAULA: Yeah.

MEENAKSHI: For whatever reason.

MEENAKSHI: And but at the end of the day, it is when a guest finds value in the subscription is when Panera gets value in that as well.

PAULA: Totally.

MEENAKSHI: Yeah.

PAULA: And again, just reading through, I suppose, all of the, you know, price point and what that equates to.

PAULA: I mean, it’s literally four cups of coffee in a month is all that you would need.

PAULA: So very happy.

MEENAKSHI: Yes.

PAULA: Who’s not going to have four cups of coffee?

PAULA: I think most of us have that.

PAULA: I won’t say daily, but almost certainly weekly.

PAULA: So very easily.

MEENAKSHI: Certainly.

PAULA: Wow.

PAULA: And I love that.

PAULA: And I will be quoting you, Meenakshi.

PAULA: So redemption drives retention.

PAULA: So there you go.

MEENAKSHI: My contribution of a nugget for you.

PAULA: There you go.

PAULA: A nugget.

PAULA: I love it.

PAULA: Brilliant.

PAULA: So I wanted to talk about then, as you mentioned, you’re doing lots of, I suppose, trials and testing and new ideas.

PAULA: So today, for example, I can see a fantastic sign up for the subscription program and it’s free till the end of December.

PAULA: And I know that went live at the beginning of October.

PAULA: So a full quarter of free coffee, which is incredibly compelling.

PAULA: And then I saw fabulous partnerships as well.

PAULA: So, for example, American Express card holders get six months free of your subscription program and also a partnership with them, with Audible.

PAULA: So tell us what’s going on with all of these various partnership ideas.

MEENAKSHI: Yeah, you know, I think it is about we’ve come to a scale with our loyalty program where we really think about how do we continue to add value for our guests.

MEENAKSHI: You know, there are these promotional benefits.

MEENAKSHI: And this is something that any loyalty person, you know, when you take on a program, you try to balance out the promotional needs with the emotional benefits and something which is beyond just a transactional benefit.

MEENAKSHI: Yeah.

MEENAKSHI: As we think of that, that’s where this idea of partnering with like minded brands comes into play.

MEENAKSHI: We did this with Audible, which was how the you know, when you have when how do you give them three months of free trial on Audible?

MEENAKSHI: They do that as a promotion to invite new guests.

MEENAKSHI: But our coffee subscribers or our MyPanera loyalty members, we think are a very like minded group that will be interested based on where who our core customer is and any kind of customer assessment that we’ve done.

MEENAKSHI: We believe that this would be a very qualified audience to do that trial.

PAULA: Cool.

MEENAKSHI: So how do we come together to think about adding value to both audible guests by giving them a coffee subscription trial?

PAULA: Yeah.

MEENAKSHI: And MyPanera guests to give them an audible trial was how this partnership came about.

MEENAKSHI: And likewise, thinking about Amex, right?

MEENAKSHI: Amex is one of the best at doing that.

PAULA: Yeah.

MEENAKSHI: Amex members get the best rewards there is and the best benefits there are.

MEENAKSHI: And they have an incredible reach that they’re able to talk to guests.

MEENAKSHI: And it’s great that that’s why we had to really make sure this was a true, compelling offer for our Amex guests.

MEENAKSHI: And hence, they’re supporting it with a six month trial for them.

MEENAKSHI: And we want our Amex guests to try that out.

MEENAKSHI: So this is a way for how you get like and it has to be important in terms of how you find the right brands to balance it out with.

MEENAKSHI: We did this even with Shutterfly earlier this year, where we could give, you know, you can create your own mug, a personalized mug with a coffee subscription.

MEENAKSHI: So it’s our way of saying thank you to our loyalty guests, but also a way to continue to find value and a reason for being a loyalty member.

PAULA: Yeah.

PAULA: And it’s a lovely, gentle way as well.

PAULA: I did some partnerships myself years ago.

PAULA: It’s a lovely, gentle way of doing, I suppose, introductions on both sides, because, you know, very much I know that if I’m the type of person that’s going to put a picture of my cash, for example, on a mug, which I definitely plan to do, then it definitely means I’m going to be the type of person who will do the family calendar and I’m going to need those kind of printing services.

PAULA: And it is a very gentle way to find, I guess, new ways to do things that I love to do.

MEENAKSHI: Yeah, exactly.

MEENAKSHI: And it’s, you know, it’s a coffee mug.

MEENAKSHI: And we know our coffee subscribers would love that.

MEENAKSHI: And we did that in the summer and it was very well received as well.

PAULA: Great, great.

PAULA: And again, just because we have a lot of global listeners, Meenakshi, I’d love to get a sense of the scale of the program from memory.

PAULA: I think you guys are certainly in, I don’t know, I’m going to say like the top ten in terms of member base.

PAULA: Can you share the member base for My Panera as it stands?

MEENAKSHI: Yeah, My Panera actually is one of the largest loyalty programs that’s out there.

MEENAKSHI: You know, we’ve had about 45 million overall members.

MEENAKSHI: And in around 20, 25 million have been on an active annual basis.

PAULA: Oh my goodness.

MEENAKSHI: And it’s the largest program that’s out there and it’s been the longest running as well.

MEENAKSHI: And it’s a program that we continue to try and find more value for our guests and improve that on a constant basis.

PAULA: For sure.

PAULA: Which brings me on to, I suppose, the final question from my side is around what’s coming next.

PAULA: Can we expect to see, you know, my Panera Bread doing, I don’t know, subscriptions in other categories or I don’t know.

PAULA: I just my mind would be like, oh, you know, if I was in your position, I wonder what I would be doing next.

PAULA: So what can you share with us?

MEENAKSHI: I can tell you it’s something that whatever we do is something that’s going to be unexpected.

MEENAKSHI: Because that’s what Panera does, right?

MEENAKSHI: We want to continue to innovate and really push ourselves.

MEENAKSHI: I think in the space of loyalty, we do, you know, it’s a strategic choice for us to think about.

MEENAKSHI: We also paused and thought whether we should be going into points or tiers or so on.

MEENAKSHI: And I, you know, we think subscriptions are the way for us to drive value for our guests.

MEENAKSHI: Okay.

MEENAKSHI: And what’s coming is going to be something and it’s an expansion to our coffee subscription.

PAULA: Oh, okay.

PAULA: Can you give me any sense on timing just to, you know, tease our listeners?

MEENAKSHI: Or maybe things are being worked through.

MEENAKSHI: We have a lot of ideas in the testing.

MEENAKSHI: You know, honestly, I will say we take.

MEENAKSHI: And that’s something that I have learned is we take a very disciplined approach to innovation, even in the subscription or loyalty programs space, right?

MEENAKSHI: Just like a new product idea, you think of a concept, you put it in front of your customers and understand their appetite to try it.

MEENAKSHI: But we test it in the market to see what happens before we launch it.

MEENAKSHI: So we follow the same kind of rigorous process before we launch something, especially because of the scale and to your point, all the stakeholders that are involved, we want to make sure we’re making a wise decision.

MEENAKSHI: So we are going through that process.

MEENAKSHI: So unfortunately, I don’t have something that I can tell you now.

MEENAKSHI: But more to come and hopefully we can connect again.

PAULA: Well, I was just about to say, I just want to, you know, tee it up for this time next year, because I feel like, you know, with big brands like you guys, there’ll always be incredible news to share.

PAULA: It’s not like we have a conversation today in your job and loyalty is done.

PAULA: So for listeners, I’m sure they’ll be very happy to hear that we will stay connected.

PAULA: And yeah, maybe do something again in the future together.

MEENAKSHI: I would love that.

PAULA: Great.

PAULA: So listen, that’s all from my side, Meenakshi.

PAULA: As you know, I’ve been waiting a long time just to kind of hear all of the inside scoop for Panera Bread.

PAULA: So were there any other points that you think are important for the audience before we wrap up?

MEENAKSHI: Now, I think I will just say we should think about loyalty as a program, but also loyalty as what we’re trying to do with our guests.

MEENAKSHI: And I don’t believe there is one way, one size that fits all.

MEENAKSHI: And we should really be true to what our brand values are and what our customer proposition is in anything that we do with the loyalty program.

MEENAKSHI: It shouldn’t be because everybody is doing it, because clearly it’s very, very prevalent now.

MEENAKSHI: But the relevance of your program matters a lot, especially today.

PAULA: Oh, brilliant.

PAULA: Well, listen, I couldn’t have said it better, Meenakshi.

PAULA: I think that’s exactly what people need to hear because, you know, certainly I’m guilty of going, oh, you know, let’s try subscription, but it does need to be the right program, as you said, relevant for the right audience and the right people.

PAULA: So yes, it’s good to take a disciplined approach and learn from what you’re doing and adapt to what the various brands need.

PAULA: So my final thing, then, is if people do want to reach out to you, Meenakshi, for example, on LinkedIn, are you comfortable to maybe, you know, be able to talk to people there if they want to talk to you?

MEENAKSHI: Yeah, I’m absolutely happy to share.

MEENAKSHI: You know, this is something that I’m that I’m learning as well.

MEENAKSHI: So I’m always learning something from every new conversation.

MEENAKSHI: I’m happy to do that.

PAULA: Oh, thank you so much.

PAULA: Well, listen, with that, I will say, Meenakshi Nagarajan, Senior Vice President of Recurring Revenue and Loyalty at Panera Bread, thank you so much from everyone at Let’s Talk Loyalty.

MEENAKSHI: Thank you.

PAULA: This show is sponsored by The Wise Marketeer, the world’s most popular source of loyalty marketing news, insights and research.

PAULA: The Wise Marketeer also offers loyalty marketing training through its Loyalty Academy, which has already certified over 170 executives in 20 countries as certified loyalty marketing professionals.

PAULA: For more information, check out thewisemarketeer.com and loyaltyacademy.org.

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