Digital Innovation Keys the Progress

Tropical Smoothie Cafe has been one of the industry’s true COVID-19 success stories. The brand’s same-store sales ballooned 19.5 percent, year-over-year, in Q3—a company record. Year-to-date comps are 3.4 percent higher than 2019 levels. Meanwhile, it opened 75 restaurants and is on track to surpass 85 by year’s end. Perhaps equally vital, Tropical Smoothie’s pipeline hasn’t slipped, despite cautious conditions (to put it lightly). By October, the chain signed 184 franchise agreements to expand well into the future. Yet this swell wasn’t a day one reality. Tropical Smoothie pivoted just like everybody else. And part of that was accelerating technology to better serve a COVID climate as well as whatever might arrive next. Tropical Smoothie’s digital sales consistently climbed over recent months. In August, digital accounted for 35 percent of the brand’s business, with some stores generating 65 percent or more. Michael Lapid, chief information and digital officer with the brand, spearheaded COVID lifelines like curbside pickup, third-party partnerships, and helped advance communication tools in Tropical Smoothie’s mobile app and guest contact center, among other plans. Lapid, who joined the company in October 2019, chatted with QSR about the brand’s journey and what it has planned for the next stage of the crisis. Let’s go back to the early days of COVID. How much of the business was dine-in before the pandemic? How did the digital split up (between carryout/delivery, etc.)? The shift away from dine-in business across the restaurant industry was something no brand had experienced before the pandemic.

Fortunately, as a fast-casual concept, our business model incorporated operational procedures for carryout business prior to the pandemic, and while the dine-in part of our business was initially impacted, we were able to quickly mobilize a more convenience-based ordering model to meet the new needs of our guests and sustain business for our franchisees. Prior to the pandemic, we were 31 percent dine-in to 69 percent carry out. Today, we break down carryout a bit more to include all digital ordering and off-premise sales because our dining rooms remain closed and we are experiencing 35 percent digital transactions. When dining rooms started to close, from a tech side, what were some areas Tropical Smoothie targeted from the outset? Where did you see customer behavior going and how did you move to meet it? The pandemic completely transformed consumer behavior. As dining rooms closed, our guests began ordering food to be delivered or picked up, whether that was through the drive-thru or curbside, and we knew we needed to pivot our strategies to stay relevant. Within two weeks of the pandemic striking, our team rapidly expanded or rolled out new initiatives to adhere to the team member and guests’ safety, such as third-party delivery, curbside pickup, and shortly thereafter Tropical Smoothie Cafe branded delivery available in the mobile app and via online ordering.  Talk specifically about curbside. What did it take to roll that out, how fast was it, and what were some learnings you’ve continued to try to improve upon? Our team was able to launch curbside pickup in 10 days from when businesses started to close dining rooms, which includes the development of the mobile and web experience and the execution across all of our locations. We strongly anticipate that curbside ordering will remain in high demand for consumers and we will continue to refine our processes. For example, we are currently piloting a guest notification experience to alert the cafe when the guest arrives to pick up a curbside order.