• Professor says Panera's Pay-it-Forward Café is a Win-Win

1/11/2013

What happens when a business trades in its cash register for a collection box? We’re about to find out.

Panera Bread plans to open a Panera Cares café in Government Center, where customers will be asked to pay whatever they think their food is worth. It’ll be the first café of its kind in Boston.

Giana Eckhardt, Marketing professor and co-author of The Myth of the Ethical Consumer, thinks it’s a win-win for Panera and our local community. On a Boston Public Radio show with Jim Braude and Margery Eagon, Eckhardt said the idea “has a lot of brand-building potential.”

Panera has four similar nonprofit cafés in Missouri, Oregon, Michigan, and Illinois. According to Panera CEO Ron Shaich, about 60 percent of customers pay the suggested amount for their food, about 20 percent give more, and about 20 percent give less or nothing at all.

Eckhardt isn’t surprised by the numbers, but she doesn’t think they’re driven by ethics. Instead, she says the amount people will pay is primarily driven by the social norm. In other words, the amount you give will probably be similar to what everyone else is paying.

There are other factors we take into consideration, even if we don’t realize it. For instance, depending on how much money you have in your wallet, whether or not you’re in a rush, and your cultural upbringing, you may give more or less, Eckhardt explained.

Surprisingly, wealth isn’t one of those factors. Eckhardt says there’s no correlation between income and generosity. In fact, people in lower socioeconomic brackets are sometimes more generous, perhaps because they understand the value of giving at a more personal level, she said.

The new café is expected to open early this year. Eckhardt predicts that it will bring Panera great advertising and public relations benefits.

Listen to the full interview online.

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