Mark Ritson: Pret must bite the cost bullet if it wants to keep its ‘natural’ brand positioning

Pret A Manger has built a brand positioning based on serving natural food, yet the E numbers in its bread clearly undermine that, so it has to decide whether to change its processes or its advertising.

Pret a Manger brand positioningIt has been the high-water mark for British branding for more than two decades. Look around the high street and it’s hard to find a better run marketing operation. Pret A Manger is, on so many levels, as it good as it gets.

Its in-house design team continues to produce a distinctive experience second to none. The constant evolution of its menu and the jaw-dropping decision to make and bake much of its products at each location ensure very high levels of quality and freshness. Its approach to employer branding sees every potential recruit given a day to experience Pret and for its local team to experience them before potentially offering a job to the hopeful candidate.

It’s a brand so beautifully positioned on ‘quality’, ‘fresh’ and ‘natural’ that it famously does not need an advertising campaign to promote its offer. Its people, products and places do the job far better than any big campaign could ever claim.

Offering fresh, natural, quality food to consumers is hardly the most innovative approach to finding your marketing north star. But it’s easy to sneer at such simplicity and miss what makes Pret truly great. It’s not the brand positioning itself, but the way this very simple concept has been so thoroughly applied to every possible touchpoint in a totally appealing manner.

For years Pret has used its windows, its packaging, its napkins and any other inch of retail real estate to communicate its brand promise that creates “handmade natural food”. In a further step, Pret not only positions to customers, it also openly positions against its mass-produced rivals. Pret claims on its packaging that it “avoids the obscure chemicals, additives and preservatives common to so much of the ‘prepared’ and ‘fast’ food on the market”.

Live up to your brand positioning

But it’s exactly this approach to clearly promoting its brand that has got the company into trouble. Three years ago the Real Bread Campaign, part of the food charity Sustain, contacted Pret A Manger’s chief executive Clive Schlee. The campaign noted that, despite claiming to offer natural food free from additives, its bread was actually brimming with the stuff. Specifically, E920 (L-cysteine hydrochloride) E472e (diacetyl tartaric acid esters of mono- and diglycerides) and E471 (mono- and diglycerides of fatty acids).

Pret is positioned on natural food free from additives and preservatives and these three E numbers are, well, exactly that. The letter from the Real Bread Campaign encouraged Schlee to either amend his company’s marketing or change his product ingredients to live up to the claims the marketing was making.

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It’s at this point that we reach the incredibly risky impasse known as ‘the CEO starts talking to people about stuff’. I continue to be of the opinion that most chief executives get into their position because they are masterful political operators and rarely the best men to run their operations – and with only 7% of FTSE companies run by women, I am afraid I am going to keep this targeted on the omnipresent masculine form.

This is a bit unfair in the case of Schlee. Even a superficial assessment of his performance running Pret could only conclude that his 15-year tenure at Pret has been nothing less than spectacularly and consistently successful. Year after year, Schlee has shepherded Pret to constant revenue and profit growth.

But none of that means he is going to pass muster when it comes to ‘the CEO starts talking to people about stuff’ test. You take a man with a proven track record for running a business well, who enjoys a seven-figure benefits package and (probably) a not-insignificant view of his own business acumen, and you introduce him to a bunch of hippies who want to change the world by getting communities to bake organic sourdough. It’s not going to end well.

Any decent marketer, say Mark Palmer, Pret’s inestimable former marketing director, would have intercepted the letter from the Real Bread Campaign and smelled, right from the opening sentence, that there was potential trouble here. But CEOs, not so much. They tend to create crises, rather than manage them well.

Schlee, to his credit, replied to the campaign, pointing out that the scale and size of Pret’s baking operations meant the E numbers were unavoidable. He challenged the campaign to come back to him with a list of ‘real’ bakeries that could deliver the scale Pret required without the E numbers the campaign objected to. One imagines Clive Schlee dictating his retort and nodding his head with a ‘right, that’s sorted that mob out’ gesture, before heading off for a super-expensive lunch meeting.

Will Pret walk the walk and spend the extra money to bake ‘real’ bread from now on? Or will it cut the talk and avoid any direct or overt mention of the world natural in its in-store advertising?

But the hippies were back a few days later with a list of bakeries that did bake real bread and could provide the scale that Pret were looking for. Bollocks, as we say in crisis management. Schlee wrote back that these bakeries were two to three times more expensive than his current suppliers and would cost several million pounds in increased costs.

Meanwhile Pret continued to make its natural, no additives claims despite the fact that its bread continued to contain additives. The Real Bread Campaign then took the case to the Advertising Standards Authority. In its defence to the ASA, Pret A Manger claimed that its natural claim was expressed as a ‘mission’ and was therefore an ideal state or its ultimate goal.

Pret argued that this was very different from a claim that it had arrived at that ideal state. It also pointed out that it only claimed to ‘avoid’ (as opposed to entirely eliminate) ‘obscure’ (as opposed to all) chemicals, additives and preservatives.

Pret has a branding dilemma

It’s worth pausing here to note just how fucked, in fact triple-fucked, Pret A Manger is at this point. Firstly, it has built a brand on being natural and free from additives and yet has been selling bread for years that is anything but. Schlee’s claim that the extra cost of natural bread would be too expensive is nonsense. You’ve already made the promise of natural bread and have been enjoying the profits of that promise, so you have to deliver.

Impressively, Pret makes a huge proportion of food on each of its 500 premises each day to help deliver on the fresh and quality brand attributes. That move alone, and the subsequent need to have much bigger kitchens and floorspace instead of a central production facility in Hounslow or Milton Keynes, must cost Pret millions already. Why not do the same for bread?

Secondly, despite what its clearly very expensive but entirely hopeless law firm stated to the ASA, you cannot claim that ‘natural’ is your “brand mission” but not necessarily something that is actually, er, true. If I assure my wife that I have not cheated on her and then, when caught in flagrante delicto (which is an extremely perverse Italian sex move) with the next door neighbour, I explain that being faithful was certainly my mission in life but not necessarily something I was actually delivering on, I know how that ends.

Brand purpose and corporate mission statements might be a giant pile of bullshit, but you can’t use that as a legal defence.

Thirdly, when Pret’s brand actually stands for something and it is then shown not to be delivering on this, it is particularly vulnerable to the fallout, even though it may actually be doing a pretty good job compared to its competitors.

Let me explain this last point with a short story from my own roller coaster ride through various personal finance brands. About 15 years ago I found myself in North Africa in a very expensive hotel, extremely smashed, with the vice-president of a famous French luxury goods brand. He was, quite incredibly, more smashed than me. We happened to be in a small boutique that was part of his retail operation and I was endeavouring to buy a bag for my wife under his expert direction.

When it came to making payment however, my credit card was declined. My amiable French executive stepped in and paid for the item, reassuring me that is was “totally understandable”, and I that I could send him the money “when I was able”.

I got back to my hotel room, rang HSBC and politely let loose. I had a £10,000 balance on my HSBC card. The bag was £6,000. What was the problem? “Ah,” came a polite voice from London, “you’ve been in four countries in the last week and your travels set off a credit flag. We put a hold on your credit card because of fraud concerns.”

If I had been with Abbey National or Barclays or any of the utterly generic banks I might have hung up at this point and slept it off. But as I pointed out on the phone: “You’re ‘the world’s local bank’. I am with you because I go to lots of countries with work and because you stand for that kind of thing.”

You see my point? Pret is particularly fucked because, even though its bread is surely devoid of many more E numbers that its fast food rivals, its target customers, the expectations they have, the brand positioning and 20 years of advertising on napkins are all pointing to ‘natural’. Customers go to Pret because it is additive-free and the news that it is not will hit the brand much harder than KFC, McDonald’s or Subway.

Last week, after a 16-month investigation, the ASA concluded that because Pret’s ads claimed its food is ‘natural’ when some products contain artificial additives, its ads were misleading and breached rules 3.1 (misleading advertising) and 3.7 (substantiation) of the advertising code. Imposing a ban on any further advertising, the ASA told Pret A Manger to “ensure its ads did not claim or imply that its food was ‘natural’, unless its products and ingredients were in line with consumer expectations of the term ‘natural’.”

Real Bread Campaign coordinator Chris Young, who submitted the complaint in December 2016, said: “We look forward to seeing Pret removing all misleading claims from its advertising but would prefer to see the company kick out all artificial additives they use and give their customers the chance to enjoy sandwiches, baguettes and wraps made from Real Bread.”

We now await the decision from Pret A Manger. Will it walk the walk and spend the extra money to bake ‘real’ bread from now on? Or will it cut the talk and avoid any direct or overt mention of the world natural in its in-store advertising? The option of a brand purpose to ‘deliver as much food to the hungry people of the world with innovation, integrity and a passion for nature’ is surely now also an option.

It’s obvious what the correct answer is. Naturally, I assume Pret A Manger will work it out.