Dive Brief:

• Sweetgreen is piloting Sweetpass, a subscription service that offers customers a discount of $3 on meals every day for a month. The service costs $10 and is available for purchase between Jan. 3 to Jan. 16, according to a statement emailed to Restaurant Dive.
• The loyalty program was part of a pivot away from a "one size fits all" approach in order to offer customers a more personalized experience, a Sweetgreen spokesperson wrote.
• As digital restaurant sales have risen, growing chains have deployed loyalty programs to encourage larger checks, collect valuable data and boost customer retention.

Dive Insight:

Restaurant chains are increasingly turning to subscription programs in order to drive sales and frequency. Prior to the pandemic, Sweetgreen relied heavily on office lunch traffic to capture diner spending. Now that business districts have lost large swaths of commuters thanks to new work-from-home policies and COVID-19 concerns, a subscription could help nudge workers still visiting the office to order from the salad chain again or try it for the first time. 

This move also makes sense for Sweetgreen, which is fresh off its IPO, because 68% of revenue coming through digital channels in 2021, according to the company's S-1 filing. Sweetpass will allow the company to test customer reaction to subscription-based loyalty programs.

The benefits of an attractive loyalty program could be significant — Paytronix reports that checks were 6% larger for loyalty customers than non-loyalty customers. Loyalty programs also tend to increase visits by somewhere between 18% and 30%, per the same report. 

Consumer interest in subscriptions is strong. The subscription economy has expanded over 435% in the last nine years, according to Zuora, a cloud-based subscription management platform. Panera and Pret A Manger have found success with their subscription programs, with the former seeing visits increase 70% during its pilot period and generating over 700,000 sign-ups in July 2020 alone. Taco Bell also got into the game, launching a Taco Lover's Pass in September.

Other brands, like McDonald's and Del Taco, debuted loyalty programs earlier this year as chains compete for customer attention. More than 47% of customers use at least one loyalty program, according to recent data. Retention and higher spend could help Sweetgreen attain profitability after years of losses, although the company's units tend to be profitable and have an average unit volume comparable to other digitally focused fast-casual concepts.