By Daclaud Lee, Project Manager / SEO Consultant at Archmore Business Web
What's better than doing SEO for a coffee shop? Panera's Unlimited Sip Club, that's what! For the record, Panera is NOT paying me to write this article, nor are they a client of ours. I am writing this because from a marketing point of view, it's absolute genius!
If you drink coffee or tea, then you should join Panera's Unlimited Sip Club too! I just joined Panera Bread’s unlimited sip club on September 18, 2022 because I received an email from them stating that I would get one month free. I figured why not and gave them my credit card number for a subscription...
Do I have any regrets? No, because and the unlimited sip club is totally awesome! I can get just about any beverage I want (exceptions apply) from any Panera store anytime I wan for a monthly subscription fee of
$10.99 (edit: $11.99 as of now)! It’s a great deal, especially since I don’t have to hassle with making my own drink in the morning when traveling to meetings or the office. Therefore, it saves me a ton of money every day I visit, so why not?
With the sip club, you can usually bypass the hassle of asking an employee for a cup by simply picking up your cup at the pick up station. Some stores even leave a bunch of cups and a kiosk out front so unlimited sip club members can just pick one up without even talking to an employee. Many customers will not face this issue when it comes to this program because some stores may not adopt this practice and they might just leave your cup at the pick up station. In most stores, you don't have to really deal with the hassle of asking an employee for a cup, but there are still stores like that out there.
Panera's unlimited sip club allows members to get as much coffee and beverages as you want. Considering the average price of a cup of coffee is $3-5, this is absolutely worth it! I can say with absolute conviction that this is one of the best values in the world of coffee! This is one deal that I see absolutely no flaws in!
Panera's Coffee Club launched in February 2020 and quickly gained popularity with its range of monthly subscriptions. The initial Coffee Club cost $8.99 for three cups per month, which included a cup of coffee or espresso beverage and a pastry or snack. By the end of 2021, the Coffee Club had grown to 600,000 subscribers, of which 300,000 were paying (most new members receive free membership for the first three months and then are charged).
Here's a video I found with an interview with the current CEO of Panera who decided on implementing the unlimited sip club. For $10.99 a month, you get as many drinks as you want! The reason why they implemented this program is because they know their customers will also be ordering food too.
* As of September 2022, the unlimited sip club allows you one drink and unlimited refills of that drink every 2 hours, but this could change if you are reading this article past the date of publication.
The Sip Club membership is intended to be easy. You can log onto the app, select your drink and make your order. If you don't have your phone with you, no worries! Nobody will check to make sure that you have the subscription.
Not just unlimited coffee and drinks for you, but Panera’s Sip Club is a great idea for business. They get paid whether you use it or not. This works out for them because (I think) for the most part, Panera throws away their coffees, teas and lemonades at the end of the day anyways. So in order to prevent waste and give them recurring revenues, they have created an unlimited sip club that allows customers to refill on anything off of the menu.
Having a pay-as-you-go model works for coffee shops and restaurants, but Panera's unlimited sip club gives its restaurants a sustainable, recurring revenue. This strategy is set up to generate extra sales, with the potential for increased guest counts and increased average check size as well.
Of course, customer theft is always an issue. I still believe that Panera makes its money back because a cup of coffee really has a high profit margin and they can't reheat and reuse old coffee the next day. The main loss I assume comes from the Charged Lemonades, juice teas and fountain drinks, although I assume it is not that great of a loss since it takes a special type of person to actually sit there all day and drink until they can't drink anymore. Also, a large charged lemonade has over 400+ calories, so I assume it would be super unhealthy for a person to drink one every day. They would have to be a complete moron to sacrifice their health, but I digress.
Even Panera says it themselves in an interview with Business Insider, that customers are stealing drinks, but they don't suffer much of a loss. Not that I am advocating stealing, I personally think the people who do that are scumbags, and I think Panera should at least have the customer verify by opening up their phone.
It can seem wrong to just walk into a Panera without talking to anyone and just grabbing a cup and filling it up, but it's not. It's probably hard for Panera to take a loss on this since coffee has a relatively good profit margin.
It's part of the deal and you are paying for it. My guess is that they throw out the coffee and tea at the end of the night, so they would have to deal with some kind of loss anyways. So why not allow customers to enjoy it?
The Employees do not require you to whip out your phone and prove that you are a member of the unlimited sip club. As a matter of fact (at least in my experience), they won't even question your presence there.
I personally use my unlimited sip club as much as 1-3 times a day. I usually go into my local Panera in the morning for a hot cup of coffee. Once during my lunch break and a third time right after work to pick up another drink.
Sometimes I may even grab a beverage (a zero calorie bubbly lime soda) in the late evening right before they close.
The beverages at Panera have a really low profit margin and for health and sanitary reasons, they need to be discarded either at the end of each day or frequently. If Panera has to discard the beverages, then they might as well just allow customers to drink as much as they want in order to limit waste. The sip club gives Panera a recurring revenue stream and the customer can get unlimited refills and beverages. Therefore it's a win / win situation.
Considering the average coffee at Panera Bread is $3, you really only need to go three or four times to get your money's worth. On every visit after that, you're going to be getting an awesome deal! From the fourth visit onward, it's pure savings!
By Daclaud Lee, Project Manager and SEO Consultant at Archmore Business Web.
Daclaud is an award winning SEO and digital marketing consultant. He has a Bachelor of Science in Digital Marketing and has been practicing SEO, web development and social media advertising since 2009. As a former restaurant and bar owner, Daclaud has a deep understanding the every day challenges and routines of the food and beverage industry.
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