Sweetgreen Is Using Creativity and Technology to Take Consumers Beyond the Salad
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Having established itself as "the most innovative company in restaurant technology" with its win of the Restaurant Business 2019 Tech Accelerator of the Year award, fast-casual salad chain Sweetgreen is now looking to the creativity of its people and the adaptability of its tech solutions to extend its chic, modular, and sustainable approach beyond the salad.
Giving Sweetgreen 3.0 The Green Light
(Image source: The New York Times)
Inside "the treehouse," Sweetgreen's headquarters in Culver City, Calif., senior executives including company founders Nicolas Jammet, Nathaniel Ru, and Jonathan Neman are discussing a new store format called Sweetgreen 3.0, which has recently been introduced in New York City after two years of planning.
Under 3.0, the work of salad preparation and meal assembly takes place in a hidden space at the back of the store. Up front, customers who haven't done so already via mobile phone can give their orders to a Sweetgreen ambassador and pick up their meals from alphabetically arranged shelves.
The public-facing space features display areas offering Sweetgreen merchandise like baseball caps and branded olive oil. And a more tactile and interactive element is now part of the Sweetgreen experience, with printed menus, comfortable furnishing, and sections of the restaurant that can be dedicated to free product tasting.
Targeting the Right Consumers
The Sweetgreen 3.0 approach is vastly different from the experience at the brand's 102 other locations, where it's common to see enormous lines of consumers waiting and watching as Sweetgreen employees assemble Harvest Bowls, Kale Caesars, and customized platters during the lunchtime rush.
But there's still work to be done. Though it's meant to streamline the customer experience, Sweetgreen 3.0 still needs to provide the substance that appeals to a younger and higher-income demographic that favors locally-sourced ingredients and wellness delivered with the brand's fast-casual, table-to-farm attitude to catering.
Adjusting and Optimizing Food Choices
Nicolas Jammet, Sweetgreen's chief concept officer, was the brains behind the company's initial roster of meal-like salads with a common element that he and the other founders describe as "the wink": a characteristic that brings to mind something beloved and un-salad-like. So for example, one of the brand's longest-running offerings is Guacamole Greens, a healthy version of chips and dip.
At the rear of the Sweetgreen location in "the treehouse" is "The Lab" — a small space where two chefs experiment with new additions to the menu. Looking beyond the salad, in the next two years, the brand intends to offer health-conscious snacks including a range of savory sandwiches, and sweets made with organic chocolate.
Other options include a selection of side dishes that will largely repurpose ingredients already on the menu, and involve little preparation. These include a new category of "greenless bowls": a grain bowl featuring wild rice, steelhead trout, pickled red onion, and a jammy egg. As Nicolas Jammet observes about the rationale behind these selections, "There's a physical limit to the number of items we can have on that line. Every item has to earn its keep."
Integrating Mobile with Delivery
This new range of Sweetgreen dishes will round out the menu at the company's 3.0 locations, and its delivery-only "ghost kitchens," such as the site currently being built in Manhattan. As part of this strategy, the company last year acquired a meal delivery service called Galley Foods, based in Washington, and has been using its kitchens to test Sweetgreen's new sandwiches and a "virtual hot bar" of dinner items.
Last year, too, Sweetgreen's revenue topped $300 million, with over $3 million per store, and operating margins reckoned to be among the best in the business. The company has managed to raise $350 million in private capital in a little over a year, bringing its valuation to $1.6 billion, and making it the only restaurant unicorn. This has enabled Sweetgreen to make extensive investments in technology and infrastructure.
Sweetgreen was among the first fast-casual restaurant chains to create its own mobile app and allow customers to order ahead on its website. The app now has more than 1.5 million users, who account for 55% of the company's order volume. It also plays a vital role in the brand's delivery strategy.
In 2018, Sweetgreen started a program called Outpost, renting space in office and apartment buildings, and putting up its signature blond-wood shelving units for holding orders prepared off-site and delivered by a single courier. The company now has 700 Outposts, where customers who order online can pick up their meals at a convenient independent location.
Planning for A Greener and More Diverse Future
Like a few others in the fast-casual restaurant sector, Sweetgreen has a serious commitment to supporting sustainable agriculture and buying from small, local producers. Its social media output reflects this, focusing on inspirational tales of the environment rather than gimmicks and giveaways. And Sweetgreen salads are packaged in distinctive hexagonal bowls, which are said to be "compostable" or biodegradable.
(Image source: The New York Times)
Before entering a new market, Sweetgreen sends a team almost a year in advance to build up a roster of local farmers and artisans. The company is currently investing heavily in infrastructure: traditional storefronts, off-site kitchens to feed Outposts and delivery orders, kitchen automation tools, supply-chain tracking technology, and its own fleet of delivery couriers to handle Outpost orders.
Along with Sweetgreen 3.0 testing, native delivery, and Outposts, Sweetgreen recently opened its first store in Houston and plans to be in Denver, Miami, Atlanta and Austin by the end of 2020. Sweetgreen intends to double in size to 200 stores in the next three years, doing so at a moderate and sustainable pace.
Founder and co-CEO Jonathan Neman asserts that "If next year we wanted to open 500 restaurants, maybe we could find the real estate, maybe we could design and build them, but could we staff and train them, with all brand-new people? No. We need a certain number of people promoted from within to teach the next generation."
Sustainable business practices, health-conscious food, and technology-assisted delivery and fulfillment strategies are all set to be hot topics at Future Restaurants 2020, which takes place from August 31 - September 01, 2020, at the Hilton Austin, TX. Amy Hom, VP of Operations at Sweetgreen, will be one of the keynote speakers.
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