- Tue, January 18 2011
- Filed under: Cause-related marketing
Last summer, I blogged about Panera’s first pay-what-you-want, nonprofit restaurant near St. Louis. Customers are asked to pay what they can afford (their “fair share”) in donation boxes, and any profits go to charity. The chain, which called this a “test of humanity” has since opened Panera Cares community cafes in Detroit and, this week, Portland.
I predicted it would work because of social norms. So how’s it going - right or wrong? Are more people gaming it or are more people giving?
About 20% of visitors to the first two locations leave more than the suggested amount, 20% leave less and 60% pay the suggested amount. They generate on average 80% of the retail price and in St. Louis, they are generating more revenue than cost while serving 4,000 people per week. They partner with local charities to put the donations into the community, and they have more volunteers than they can handle.
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