While Tropical Smoothie Café’s check average declined slightly in 2010, chief operating officer Mike Rotondo called 2010 a “great year on different fronts” and voiced optimism about positive trends continuing in 2011.
The Destin, Fla.-based smoothie-and-sandwich brand is seeing double-digit gains in same-store sales through the first six weeks of its first quarter and has plans to sustain that momentum with its Summertime Somewhere sweepstakes, he said.
The scratch-card contest began this week and runs through May 1, giving away 12 total vacations to a Club Med resort.
“Forty-eight hours after the launch, the microsite had 8,000 hits, and 2,800 people had registered to see if they’d won a trip,” Rotondo said. “If that’s the first two days, then we expect this promotion to really get some attention.”
He said Tropical Smoothie Café’s same-store sales grew 8.5 percent in 2010, due to double-digit gains in systemwide traffic, making up for a slight dip in the average check from about $8.10 to about $8.
Unit growth was 9.3 percent last year, as the chain opened 25 locations to reach 293 by the first quarter of 2011. Four of those new restaurants were on college campuses, including a 270-square-foot space in a new athletic complex at the University of Iowa. Going forward, the chain will capitalize on its ability to convert buildings of closed former restaurants to Tropical Smoothie locations and explore opening in other nontraditional venues like airports and hospitals, Rotondo said.
“We can get in there and convert very efficiently, and it’s given us this opportunity, because that’s what the climate is out there,” he said. “Unfortunately, there are a lot of restaurants that didn’t make it in this past recession, so there are landlords that have become aggressive with what they’ll offer to people to get tenants in those empty spaces.”
Tropical Smoothie also dispatched aggressive offers to help offset the blizzards that have hit all across the United States this year. The brand and its franchisees have been fighting the severely inclement weather of early 2011 with discounts pushed via Facebook and especially text messages. Discounts like 99-cent flatbreads or a free cup of soup with the purchase of a sandwich have been averaging redemptions between 10 percent and 20 percent in some markets, Rotondo said.
Tropical Smoothie also used the very nontropical weather to push its catering business.
“In our markets where those huge blizzards hit, we told our franchisees to get an e-mail or a text out to catering customers and deliver their orders to the offices if people were stuck,” Rotondo said. “We try to teach our franchisees to use something like that to their advantage, especially if your competitors are rolling over and cutting staff in bad weather.”
Quick-service competitors are not ceding any territory in smoothies, however, but Rotondo said new blended beverages from McDonald’s, Taco Bell and Panera “don’t scare us at all.”
“What we like about it is that some research I’ve seen says 30 percent of consumers still have never had a smoothie,” he said. “So now that McDonald’s has them, what a great way to introduce smoothies to a bigger group of people. Now when those people drive by us, they might see what our product is all about, and we might not have ever gotten them before.”
The brand derives about 50 percent of its sales from smoothies, with the rest coming from sales of food.
Growth plans in 2011 call for 25 locations to open before the end of June, with more to come in the second half of the year, Rotondo said. He added that multiunit franchisees operate about 45 percent of the system, which is double what the percentage was 18 months ago.
Tropical Smoothie Café operates or franchises in 34 states.
Contact Mark Brandau at [email protected].
