I was over at Panera Bread this afternoon grabbing lunch and noticed something really strange. All the tables at the restaurant (around 20) were occupied. Under normal circumstances, this would seem as a picture perfect scenario exept around 17-18 of these tables were occupied by "campers", people who ordered their 1 sandwich meal and hover around for another hour or so typing away on their laptop using Panera Bread's free wireless Internet acess.
The wireless internet model has worked great for Starbucks which is primarily a "stop-n-go" location where the majority of the customers just want to get their coffee and leave. But the same successful model doesnt seem to translate well in a "sit-down" type of establishment.
Since i live just half a block away from this Panera Bread location, noticing the lack of empty tables, i decided to take my lunch to-go. But i wonder how many potential customers were turned away after noticing the lack of seating. I understand that this free wireless internet policy will defiantely foster some brand loyalty. The next time i want to eat and get some work done on my laptop, my first choice will be Panera Bread. I also understand the potential for marginal purchases, after clicking away on my laptop for an hour i might buy another drink or a cookie/brownie. But for practical purposes i will assume these incremental purchases to be very minimal for Panera Bread's revenue after purchasing their initial meal.
I really doubt that the pro's (brand loyalty, incremental purchses) outweigh the loss of revenues from turning away potential customers in that hour or two. Panera Bread's (PNRA) stock price is also hovering around its 52-week low. Ofcourse, i have no real figues to back up this observation (qoq same store sales, etc.) but it certainly seems that Panera's community friendly approach is biting them in the ass.
If anyone else sees the other side of the coin, please comment.
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