Sweetgreen Grows Where Workers Go

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Sweetgreen's recent quarterly earnings indicate a green outlook for 2022, but reports of "lunchflation", or increased prices workers face for fast casual fare like salads and sandwiches, should be heeded as a sign of future downturn.

New York City suffered heavy foot traffic and revenue losses during the pandemic, especially for business districts. Major firms like Google are finally compelling workers back to the office, and even New York City's new mayor requested employers bring staff back to their physical offices. Cushman and Wakefield's fourth quarter 2021 report indicated NYC retail spaces are finally finding tenants, driven by the food and beverage industries.

How can fast casual restaurants optimize site selection and cater to the right customer? 

We ran a temperature check on Sweetgreen locations in New York City and found mixed trends for their busiest locations.

Can higher salad prices explain locations with downward-trending traffic, or are there other factors at play? The top two Sweetgreens in Manhattan tell opposing stories. 10 Hudson Yards shows rising traffic, while 606 1st Avenue is on a negative slope.

But daily traffic only tells part of the story. Neighborhood insights for each location provide a window into the types of consumers navigating the area. Can we pinpoint explanations for these traffic differences? 

Sweetgreen's 606 1st Avenue location lies within a small census block group (CBG) surrounded by equally sized CBGs. We gathered data for four total CBGs to cover the blocks surrounding the area. Total foot traffic for the immediate neighborhood around this Sweetgreen shows a trend similar to the store itself, indicating an under-utilized area overall, especially starting in the month of March.

Neighborhood traffic for the 10 Hudson Yards Sweetgreen was derived from a single large CBG with comparable street coverage to our analysis of 606 1st Avenue. A similar downward shift in traffic appears for this location as well, despite the Sweetgreen showing positively trending traffic.

What additional consumer insights can we draw from neighborhood traffic data? 

For all of the census block groups examined, we can break out proportions of resident and worker foot traffic, which reveals an additional angle. The neighborhood surrounding Sweetgreen's ailing 606 1st Avenue location shows a higher instance of residents compared to workers with a positively increasing residential trend and a loss of worker traffic throughout March. This pattern reverses when reviewing the neighborhood surrounding their 10 Hudson Yards location.

Workers dominate traffic around Sweetgreen's positively trending location in 10 Hudson Yards.

Additionally, worker traffic has remained relatively stable over the course of 2022, indicating this Sweetgreen location likely benefits from lunch break traffic compared to residential areas, and it's not slowing down. This is a key consumer trend for Sweetgreen to note. While rising prices may be a factor in reducing traffic at some locations, the positive traffic trends for over half of their busiest locations suggests there are neighborhood patterns at work.

We postulate that for residents, rising prices may increase turn-away rates, whereas workers are currently absorbing rising lunch costs. For now.

Neighborhood data can be a vital part of site selection and performance evaluations for retail sites with only a four-day lag. Data beyond worker and resident break-outs also includes whether visitors live and work within the CBG, the metro area, or hail from outside the metro area. Data for the brand itself can also show visitor home and work locations, visit duration, and distance traveled.

Schedule a meeting to find out more, or you can always talktous@unacast.com. Interested in how inflation is impacting other brands? Check out our piece Gas Or Go: Do High Gas Prices Affect Foot Traffic at the Pumps?


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