Operations

Panera’s unlimited coffee program has nearly 500K paid subscribers

The $8.99-a-month unlimited coffee offering has been “very successful at a very difficult time,” CEO Niren Chaudhary said.
Photo courtesy of Panera

Panera Bread’s coffee subscription program continues to be a success story for the chain, with nearly half a million paid subscribers currently, Panera’s CEO said Tuesday.

Panera launched the $8.99-per-month unlimited coffee offering in late February, just as the coronavirus was beginning to impact the U.S.

The fast casual signed up about 800,000 customers during its initial push, which included a significant number of free trials. Currently, it boasts nearly 500,000 paid subscribers, Panera CEO Niren Chaudhary told Restaurant Business.

So far, the coffee subscription is generating some solid metrics, Chaudhary said, chief among them:

  • 90% incrementality
  • 35% of subscribers are new customers
  • 35% of coffee orders include food

“The coffee program has been very successful at a very difficult time during a pandemic,” he said. “The program has resonated extremely well with where customers are at … Even when the program was being offered for free a couple of months ago, it was still profit accretive for us. We’re very excited. It’s a program that works for us.”

The coffee subscription has been particularly successful at Panera, he said, because coffee has historically been a “high-quality underleveled asset.”

The monthly subscription allows customers to get any size and any flavor of hot coffee, hot tea or iced coffee once every two hours. Beverages can be ordered inside Panera’s restaurants, about 95% of which currently have open dining rooms, or via the chain’s website or app.

“We are very committed to it, Chaudhary said. “We will continue to offer customers choice. Right now, we have a full range of hot and cold beverages. We have non-dairy milk options. We’ll be bringing in exciting innovation on beverages in 2021.”

A recent study found that about 55% of New York City residents would be interested in a restaurant subscription service.

Other chains are also trying subscription programs, including monthly meal boxes from Dickey’s Barbecue Pit.

 

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