Panera's Charity Food-For-The-Hungry Program To Be Retooled

The charitable concept was straight-forward. What Panera Bread called its "meal of shared responsibility" was turkey chili in a bread bowl and it was offered at 48 St. Louis-area restaurants. The idea was that shoppers were told a suggested price ($5.89) but they could pay whatever they could. The idea is that those who needed the meal for one cent would pay that and the cost would be made up by people who paid more than $5.89 (some paid $10).

The trial didn't work out as planned or hoped, the Associated Press reports. The chain served some 15,000, but very few of them got to the needy. One reason was that most of the trial locations "are in middle-class and affluent areas." A second problem was that awareness of the program plunged after initial marketing and PR stopped.

For the first three weeks—while the marketing push was active—customers were indeed paying an average amount that was more than $5.89, said Kate Antonacci, director of societal impact initiatives for Panera, but when the signage stopped, the average price being paid dropped to about 75 percent of the suggested price.

"We were very capable of raising the level of awareness about food security in short spurts," said Panera Founder/Chairman Ron Shaich, adding that after a marketing push, "it seemed to fall into the background. We decided the best thing to do is pull it and retool it."

That retooling will likely happen next winter. This time, though, instead of it being a permanent offering, it will be limited to about 4-6 weeks, the story said.

This isn't the chain's first test of this charitable tactic. Back in 2010, Panera opened a full café outside St. Louis where everything on the menu was a pay-what-you-can item, a concept that was replicated in Panera's stores in Michigan, Oregon, Illinois and Massachusetts. With those stores, the chain found that roughly 60 percent of customers paid the suggested retail price, with the paying-more folk balancing out the paying-less folk.

The problem has been whether the paying-less people are truly needy or simply looking for a bargain and could afford to pay full price. There has historically been no good way to differentiate between those who needed the help and those who didn't. ID cards from government assistance programs could help or mobile equivalents (which are less obvious).

There's also the pride issue. If someone is homeless and truly needy, why ask them to pay anything? Might some newly destitute feel awkward about giving 50 cents, which they might truly need for other things?

The idea of this program is laudable and should be replicated, but it needs some mechanism to make sure the benefit is going to the people who need it. If not for humanitarian reasons, consider the feelings of the customers who volunteered to pay more. If they see some people who can afford more paying one penny and the initial customers know that they personally subsidized it, how will they react? Such programs depend on the customers trusting that the chain is making sure that only needy customers benefit from the subsidy. Keep the process ungated and the funders—those who volunteer to pay more—are likely to evaporate.

For more:
- See Associated Press story

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