Welcome to a Pay-What-You-Want World
"I'll have the Turkey Chili,"I said, approaching the counter at Panera Bread. The outside temperature hardly qualified as chili weather, but a hearty soup seemed like the perfect comfort food after the stressful day I had.
“How much would you like to pay for it”? the shy cashier asked.
Not sure I had heard her correctly, I asked her to repeat the question.
“The suggested price is $5.89, but you can pay whatever you want,” she replied. “It’s part of our Meal of Shared Responsibility program.
After several seconds of consideration, I opted to pay the $5.89 – in part because I didn’t want to dupe the system, but mostly because I wasn’t wild about having to make another decision.
But the scenario presented a real dilemma:
The capitalist in me wanted to be charged a fair market value for the item, providing a quality product to me while delivering a reasonable profit to the restaurant.
The humanitarian in me felt like it was my duty to pay more than the suggested price to compensate for those who didn’t have the means to afford what I could for a meal.
And the cheapskate in me was tempted to fork over a few measly coins.
Ultimately, I paid the suggested price (which was intentionally inflated to subsidize those customers who cannot pay the full amount). Which essentially branded me part capitalist and part bleeding-heart humanitarian.
In retrospect, the whole experience seemed a bit odd and confusing. Like everyone of a certain age, I’ve been conditioned to adhere to a rigid pay-what-the-pricetag-says model that’s governed American commerce for centuries. The only notable exception was when I accompanied my dad to a car dealership to witness some high-level haggling (a process that inspired me to purchase a Saturn just to avoid it).
The pay-what-you-want concept, however, is an intriguing and potentially powerful one for values-driven brands.
- It broadens the notion of value to encompass all sorts of tangible and intangible factors related to the product/service and beyond.
- It empowers consumers by shifting more control and influence to them.
- It has the potential to inspire stronger brand preference and loyalty (even for commodity products and service providers, which are constantly struggling to differentiate themselves in the marketplace).
Time will tell whether Panera’s strategy will distinguish the company as a foodservice pioneer or foolish dreamer. I’m betting it's the former.
For now, the program is still in the experimental stage as the publicly traded company evaluates the potential to roll it out system-wide (or not).
While the concept is never likely to extend broadly into all industries and enterprises, it's a logical progression of Panera's long-standing commitment to addressing hunger and other social issues in its communities. And the strategy carries so much more weight than simply writing a check to a charity.
Incidentally, the turkey chili was delicious.