Panera is adding pizza to the menu, as chains like Domino's and Papa John's sales explode during the pandemic

Panera is adding pizza to the menu, as chains like Domino's and Papa John's sales explode during the pandemic
Panera is adding pizza to the menu.Panera
  • Panera is adding pizza to the menu, rolling out three flatbreads in restaurants this week.
  • Panera exec Eduardo Luz told Business Insider that the rise of Panera's take-out, drive-thru, and delivery during the pandemic helped convince the chain to add pizza to the menu.
  • The chain wanted to make a pizza that people "feel good about eating," Luz said.

Panera is adding pizza to the menu this week.

On Wednesday, the chain announced it is rolling out three flatbread pizzas: cheese, Margherita, and chipotle chicken & bacon. Prices will start at $7.99.

"As the pandemic hit and we saw ... our guests moving more and more off-premise — ordering food to be delivered or picked up or via drive-thru — we believe that it's a platform that fits really well with what Panera can do," Panera's chief brand and concept officer Eduardo Luz told Business Insider.
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Panera is adding pizza to the menu, as chains like Domino's and Papa John's sales explode during the pandemic
Panera's flatbread is engineered to hold up as a delivery order.Panera
Luz said Panera's off-premise sales have exploded in recent months, with delivery growing in the triple digits. Pick-up and drive-thru have increased in the high double digits, according to Luz.

Pizza is an ideal menu item for the pandemic because it holds up for customers who order delivery or take-away.

As a result, chains like Domino's and Papa John's have been thriving in 2020. Domino's reported in early October that US same-store sale grew 17.5% in the most recent quarter. Papa John's preliminarily reported its same-store sales for the quarter were up 23.8%.
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Read more: 6 chains that are positioned to survive the restaurant apocalypse sparked by the coronavirus pandemic, according to experts and analysts

Can Panera take on Domino's and Papa John's?

Panera is adding pizza to the menu, as chains like Domino's and Papa John's sales explode during the pandemic
Panera isn't trying to directly compete with Domino's or Papa John's.Panera
Luz says that Panera isn't necessarily trying to compete with classic delivery pizza joints. The chain wanted to make a pizza that people "feel good about eating," Luz said. Panera will emphasize that it is using fresh ingredients in its marketing, launching what Luz called a massive campaign around its pizza next week. "People are naturally open to an elevated experience," Luz said. "And, that's the promise that Panera brings to the table."
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Panera's flatbreads are intended to serve one or to be shared among a group, paired with soups or salads. While the starting cost is $7.99, Panera is not aiming to compete with traditional pizza players on price.

"We don't lead with discounts," Luz said. "It's is not our game."

Ultimately, Panera wants pizza to be a long-term sales driver, aiming to make the category as big as sandwiches or salads. Luz said he expects customers to refuse to give up delivery and curbside even when the pandemic is over, making pizza a strategic bet for Panera's future.
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"We designed something that we think is highly complementary to what our guests already love — our sandwiches, soups, and salad," Luz said.

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