Panera will allow loyalty customers to choose rewards

Dive Brief:

Panera is adding choices to its rewards system beginning on Oct. 6, the company announced Tuesday, following a week of special loyalty promotions available to MyPanera members.
MyPanera rewards will offer a choice of bonuses based on personal preferences instead of pre-selected items.
With some 48 million members, MyPanera is one of the largest restaurant rewards programs, but lacked a degree of choice available in other loyalty programs.

Dive Insight:

Panera’s rewards program is a major driver of spending and loyalty for the brand. Over half of all Panera transactions during the first half of the year came from rewards members, who visit more often and spend more than non-rewards members, the company said in the release. The latest move ties into MyPanera’s relationship-based loyalty program, which provides guests rewards based on frequency, spend and customer preferences instead of a points-based system that looks at total spend.

By allowing customers to choose what rewards they receive in the MyPanera program, the company hopes to deepen customer loyalty and engagement. Panera is promoting the changes with a week of offerings beginning Sept. 29, including discounts on delivery, broccoli cheddar soup and two free months of the Unlimited Sip Club. That club, which offers customers unlimited drinks for $10.99 a month, replaced the brand’s coffee subscription program in the most recent upgrade to its loyalty program.

Panera has emphasized digital ordering through its app, recently launching a digital-only store, and dine-in digital ordering, as those channels enable the brand to gather more customer data and can serve as conduits for enrolling customers in the MyPanera program.

Points for dollar plans are still a simple way for brands to introduce loyalty programs, even for major brands, like McDonald’s and Taco Bell. Chipotle, whose loyalty program is essentially points for dollars, added features to personalize its rewards last year and speed up points accumulation. Starbucks’ rewards is also based on a points-for-dollars system, though the brand offers other ways to accumulate points and announced last week the addition of a secondary NFT marketplace where customers can sell tokens that grant access to specific rewards.

Panera, by contrast, factors consumer spending into its rewards offerings but also accounts for specific preferences, frequency and other consumer behaviors, which could make it more personalized.