Dive Brief:
- Panera has opened its first updated urban store format in New York City, the company announced Tuesday.
- This format, which is 40% smaller than a traditional Panera bakery-cafe, features updated ordering kiosks, a digitized menu, a new order tracking screen and only limited counter seating.
- The New York City urban store will be followed by several Panera units in urban markets this year, the company said. The chain is also targeting non-traditional locations like hospitals and universities.
Dive Insight:
Panera’s focus on urban markets is a big shift for the company, since most of its 2,200 locations are in suburban markets and about 100 are in metro areas, according to Fast Company.
Panera has six New York City locations, including two outposts in Bellevue Hospital, according to its website. It plans to open its first New York Panera To Go next month after a successful test this year.
Unlike the urban format, the To Go model will contain no dine-in seating and will only offer Rapid Pick-Up and delivery. The company opened its first To Go format in Chicago earlier this year.
The urban location features Panera’s new brand design, which includes modern art and a new color palette. The smaller formats allow Panera to gain access to cheaper real estate, as well. Because its traditional locations around 4,000 square feet, rent would be too high for these Panera formats urban markets, according to Fast Company.
The pandemic revealed significant growth potential for other formats, with off-premise making up 85% of Panera’s business. Digital sales represent about 50% of the company’s total system sales, and Panera’s latest designs better cater to a growing demographic of digital customers, the company said.
About 3 million transactions occur on Panera’s app, kiosks and website. Panera’s loyalty program, which the company revised in September to provide diners more choice, has grown to over 50 million members this year.
In new urban locations, the company will test “tap and go” technology for a more seamless experience for its Unlimited Sip Club. Artificial intelligence technology will allow staff to automatically reorder ingredients based on sales and labor scheduling.
The company piloted Miso Robotics’ automated coffee brewing system earlier this year and has also been testing AI voice ordering technology for drive-thru orders. Panera also added in-store ordering through its mobile app in February. Automated technology is expected to free up employees to focus on preparing orders and improving the guest experience, the company said.
