Sweetgreen abandons tiered loyalty for points-based program
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Sweetgreen has launched a points-based loyalty program, SG Rewards, to replace Sweetpass, a tiered subscription program that consumers found too complicated, the company announced in a Thursday press release.
SG members earn 10 points for every dollar spent, and get access to unspecified perks and members-only deals. The points can be redeemed for entrees or sides, according to the press release.
CEO Jonathan Neman said during a February earnings call that the loyalty shift would help improve Sweetgreen's value proposition — a vital consideration as consumers remain price sensitive and economic confidence falters.
Sweetgreen's new program has been in the works since last year. The program was created in response to consumer desire for a more flexible rewards program, Neman said in a statement.
'SG Rewards offers more value, more flexibility and more ways to enjoy Sweetgreen — from everyday surprise & delight moments to members-only deals and special perks,' Neman said.
The Sweetpass program that preceded SG Rewards included consumer challenges and a subscription tier, which cost members $100 annually, that gave consumers $3 discounts on orders.
To promote adoption of the new program, the salad brand is offering some time-limited perks. Consumers who sign up and complete a purchase in April will receive 1,000 bonus points, equivalent to the amount earned after $100 in spend. Existing members who make an eligible purchase before April 11 will also receive 1,000 bonus points. Those bonus points are enough to earn an order of the company's air-fried Ripple Fries, which were introduced in March, according to the press release.
On the earnings call, Neman said he expected the new program — combined with investments in menu innovation and personalized offers — would result in transaction growth.
Sweetgreen managed positive comps and traffic last year, Chief Financial Officer Mitch Reback said on the brand's earnings call. Full-year traffic rose 2%, while same-store sales increased a total of 6%.
Those numbers were impressive, given the stagnation of same-store sales at many brands, but lagged behind some fast casual competitors, like Chipotle and Cava. Nonetheless, the brand still posted a $90 million net loss for fiscal 2024, according to its 10-K, though that was an improvement over its $113 million net loss in 2023.
While Sweetgreen is still the segment leader for fast casual salads, there are other chains looking to unseat it. Just Salad, in particular, has made moves that resemble Sweetgreen's in recent months. Just Salad added heartier options focused on the dinner daypart, debuting drive-thrus and raising $200 million in capital. If 2025 brings Sweetgreen strong traffic, the salad chain could separate itself from competitors, especially if consumer confidence in the category continues to crumble as a result of macroeconomic uncertainty.
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