How Cava, Chipotle, Sweetgreen are trying to lure diners back to bowls

At 12:30 p.m. in midtown Manhattan on mid-week office days, long lines still form outside Chipotle, Cava, and Sweetgreen. Fast-casual bowls remain the defining lunch of the hybrid-work era, something quick to carry, simple to eat at a desk, and familiar enough to order without thinking. But this visible popularity now sits beside a more difficult financial reality inside the chain restaurant companies that boomed with the bowl.

Chipotle, Cava, and Sweetgreen have all reported softer traffic, and in particular less visits from younger consumers cutting back in a more tense economic environment highlighted by food inflation and job insecurity. Nearly two-fifths of consumers feel fast-casual is now too expensive, according to Datassential, a finding that matches commentary from Chipotle executives who said on their recent earnings call they are fighting the perception that their menu is more expensive than it actually is. The battle over bowl economics comes at a time when Gen Z unemployment is higher than the national average.

“We tend to skew younger and slightly over-indexed to this group relative to the broader restaurant industry,” Chipotle CEO Scott Boatwright said on its recent earnings call. He pointed to tightening budgets, saying the group has become more cautious about discretionary spending and that this translates into fewer weekday lunches.

Cava reported similar earnings and its CEO Brett Schulman pointed on the recent earnings call to “the younger cohort, that 25 to 35.”

Higher unemployment, student loan repayment and tariffs are all painting a picture of younger diners thinking carefully about each purchase. As diners cut back, fast-casual restaurants are implementing new strategies to attract customers, with added emphasis on loyalty programs and high-engagement promotions. Two-thirds of consumers say promotions influence their decisions, and loyalty programs appeal to more than a third, according to Datassential. 

Chipotle had moved more of its focus to loyalty during the summer as its sales began to stall, and it is now doubling down on deals to lure customers back. All three of the fast-casual chains have introduced a variety of campaigns since the end of the third quarter on Sept. 30, the period which included their most recent weak results.

In October, Chipotle introduced a month-long rewards program tied to purchasing an entree and scanning on the app. On Halloween, any visitor in costume starting at 3pm got a $6 entree. Capitalizing on the social media popularity of bowls, Chipotle added a Halloween TikTok challenge this year, something it had not done since 2020, another time of uncertainty for the restaurant industry.

These kinds of efforts are set to continue through the holiday season. Chipotle announced an in-restaurant buy-one-get-one-free entrée offer on Wednesday, November 26 from 4 p.m. to closing, which it noted in a release is “a popular time for young adults to reconnect with friends.” For holiday shopping season’s Cyber Weekend, Chipotle is running a $0 delivery fee offer on orders placed through the Chipotle app and Chipotle.com. It’s also launched a new Chipotle U Rivalry Week in college towns.

“They drive new sign-ups at scale, re-engage lapsed members and increase frequency among existing members. Our results show that when we create engaging experiences for our rewards members, they come more often and their spend increases,” Chris Brandt, Chipotle’s President and Chief Brand Officer, said in a statement to CNBC.

“That’s all about increasing the frequency, but also creating some level of community engagement with the brand, which helps the brand in the long run,” said Danilo Gargiulo, Bernstein senior research analyst.

Cava revamped its loyalty program in October and is testing new formats for digital demand, with a new tiered status system. According to Datassential, fast casual now has a 59% loyalty-adoption rate, one of the highest across restaurant segments, and increasing the importance of how these programs are designed.

Wall Street warms to loyalty efforts, to a limit

Wall Street is positive on the concept of leaning into loyalty, but skeptical about its ability to make a big difference right now. “It’s a unique loyalty structure that we haven’t seen elsewhere in the world. We are excited about what this could do for the business. But you know, we’re not modeling any benefit,” TD Securities senior research analyst Andrew Charles told CNBC. “Gen Z is the No. 1 thing that has changed in the recent months. That weight is deteriorating the industry, traffic,” Charles said.

The extent to which the chains are going to increase brand awareness have led into more questionable territory, with Cava launching its own merch line earlier this month, a collection including graphic tees, hoodies, hats, socks, and the brand’s food lexicon “Hot Harissa Hat” and “Extra Pickled Onions Tee.”

Wall Street is not impressed. “This is not a meaningful extension. This is more of an extension of a brand halo. Because the companies that work in the long run are companies that create a culture, but not like this,” Gargiulo.

Sweetgreen has taken a different approach to gaining customers back after multiple quarters of underperformance in key markets like the Northeast and Los Angeles, and a decline in spending among younger guests. It introduced a macronutrient-tracking tool that allows guests to see a full breakdown of protein, carbs, and fats displayed alongside calories next to menu items and custom bowls, with protein continuing to be one of the biggest guest priorities, said a Sweetgreen Spokesperson. This fall, the chain launched its Power Max Protein Bowl with 106 grams of protein, along with chicken and tofu portions increased by 25%.

But Sweetgreen has bigger issues than the current decline in younger consumer financial confidence, with its long-time inability to figure out a business model that is profitable.

Among Wall Street analysts, Loop Capital Markets’ Alton Stump thinks the selling in Chipotle shares is an opportunity. He maintains a buy rating on the stock and wrote in a recent report that Chipotle’s third-quarter results don’t justify the sharp sell-off, which has taken its shares to a year-to-date loss nearing 50%. The argument that the brand began to lose its younger core customers in Q3 is “a growing narrative,” he wrote of conversations that his firm has held with investors, and many investors expect the customer losses to continue at least over the short to medium-term. But Stump added that while the narrative “undoubtedly has some merit,” he thinks it is “overblown.”

Other bowl bulls are holding back right now. With Cava shares down close to 60% since the beginning of the year, Dennis Geiger, senior research analyst at UBS, wrote in a recent report that it remains a “compelling” growth story with differentiated menu offerings, potential sales catalysts, and attractive unit returns. But his report concluded that more proof is required that the prior high growth rate can be regained amid a difficult economic backdrop. UBS has a hold rating on the stock and is waiting for a clearer picture of its performance in 2026.