Dive Brief:

• Sweetgreen's digital sales made up 67% of revenue in Q4 2021, and two-thirds of these transactions came through the salad chain's app and website, the company said Thursday on its earnings call. Revenue for the period totaled $96.4 million, a 63% increase over Q4 2020. 
• Sweetgreen made DoorDash its primary delivery partner in November, which improved delivery rates and speed of service for customers, CEO Jonathan Neman said on the call. The chain's Sweetpass subscription pilot also exceeded expectations, though Sweetgreen didn't disclose performance metrics or details about next steps. 
• By capturing the majority of its digital orders through proprietary channels, Sweetgreen has been able to collect valuable consumer data that further hones its digital strategy, Neman said. Many major restaurant chains are transitioning to white label delivery deals to reap the benefits of proprietary diner data. 

Dive Insight:

Sweetgreen's diner data is helping the chain develop new digital-only menu offerings that could attract new customers and deeper engagement with existing fans.

These "digital exclusives" create a sense of novelty for guests without creating operational complexity for employees, Neman said during the call. The company has also simplified its overall menu to drive better digital throughput, according to the call. 

But despite the brand's focus on growing its digital prowess, Neman said the return of frontline ordering in 2021 was key part of sales growth because its physical restaurants are a major customer acquisition tool. Diners also spend more at the chain if they engage with Sweetgreen's physical outposts first and are then converted to digital customers, he said. 

"We have very clear... strategies and tactics of moving frontline customers and moving them onto our digital channels," Neman said. "Once we take frontline customers and move to digital, they're coming at least 1.5 times more frequently, and they're spending 20% more per transaction."

The chain's chances of capturing on-premise diners improve as workers return to offices. Sweetgreen's 500-plus Outpost locations, which lets workers order online and pickup from a designated location in their office buildings, have been indicators of return-to-office traffic levels, Neman said. That traffic has delivered record Outpost revenue, he added. More businesses are signing up to house Outposts in their buildings, with 17 launching next week, Neman said.

By contrast, the chain plans to open 35 brick-and-mortar restaurants in new and existing markets this year. In October, the company said it would double its footprint within the next five years and enter two to three new markets each year. Sweetgreen also plans to diversify its store network with drive-thru and pick-up-only restaurants.  

As restaurant chains bolster their proprietary digital channels, third-party delivery aggregators are honing their own offerings to retain partners. Most recently, DoorDash bought hospitality technology firm Bbot to grow its collection of first-party services and improve on-premise ordering technology.