7 Leaves Cafe, a regional coffee and tea concept with 42 locations in California, Texas, and Georgia, is a brand on the rise. And they've built a strong foundation with their culture of care, one that permeates through all aspects of their business. We were joined by Newton Hoang, their Director of Marketing and IT, on the Pre-Shift Podcast to chat about meeting customers where they are, how customers and team members reflect one another, and building a Culture of Care at 7 Leaves. But first, Newton tells us a bit about how the industry has changed during his two-decade career.
"There's definitely been a deeper segmentation relative to what I had first entered into the market as. We had traditionally sit-down and quick-serve, and then fast-casual kind of birthed in the middle. And then everything else in between that has kind of proliferated between non-traditional, like ghost kitchen concepts to on-demand.
And so the biggest change for me is how the customer expects to receive the experience, not only food, but just the way that they interact with the brands. And moreover, I've been kind of riding shotgun because I am in the marketing and IT space and just trying to meet them where they are at. And so that's been the natural evolution. And fortunately, where I'm at, I do want to position myself to be in front of that growing change versus being reactive,"
For 7 Leaves, being in front of that growing change means a foray into mobile, which currently makes up 45% of their business.
"The way that we stay in front of those particular arenas is to continue to have engaging mobile app experiences coupled with an elevated in-store experience. So my customers, whether you know it or not, DJ, are very galvanized and extremely enabled. And so when they come into our store, they expect multiple different things from, for lack of a better word, ambiance, but they expect a frictionless type of experience. And so one of the things we're sort of flirting with right now is use of lockers, and in a way that's meaningful. And so mobile being 45% of our business, upwards of 65% in some of our stores, we really want to make that holistic experience better for our customers. So those are one of those kind of initiatives that we are very happy to see materialize.
But last but definitely not least is really just trying to find the right team member base that elevates our brand and meets the needs of our customers. And so our customers and our team members are a reflection of one another. And as you might know, respective to this particular industry, labor force is a little nuanced right now. All of my cohorts are having challenges sourcing, for lack of a better word. And we have not yet felt that here at 7 Leaves. However, we are very dogged about finding the right type of personnel to ensure that our customers feel a sense of themselves when they come in. That's been one of our strategies behind the scenes,"
As 7 Leaves leadership has listened to what their customers want, they've also given their ear to what their employees want. And heard from that is what 7 Leaves calls their Culture of Care.
"From an employee standpoint, it's listening to their needs. We employ a lot of Gen-Z and despite societal stigmas, this working force here demands one thing, and that's purely knowledge. I think respectively, what we bring to the table as a brand is that we know that as an employer of choice many of them are first-time jobbers, are a transfer of knowledge, soft skills that are going to help propel them to the next echelon in their life.
And so the Culture of Care is really listening to not only what they need intellectually, but also just providing them an environment where they can kind of thrive. And respective to that Culture of Care and elevating the team member experience, the natural translation is the customer experience in which customers recognize that not only how we treat our team members being so critical in their overall perception of our brand, but what we do outside our four walls. It embodies that, right? And many of our cause marketing efforts are really built upon serving the communities that we serve.
And when team members and customers feel connected by those very actions and activities, it really validates all of the smaller minute things that we're doing. And so we have a very unique statement that we're at the intersection where life happens and respectively it resonates as far as what our care is concerned,"
And while every team member and customer interacts with that culture differently, one in particular found fulfillment and growth in their work and their life through participation in 7 Leaves culture.
"There's a story birthed out of my Anaheim, California store, that we have a store manager, young lady, McKenna Chambers, and 19 years old mind you, and she is responsible for a $2 million business. That's the AUV of her store. And she challenged our marketing department, said like, 'Hey, I want to do something with a local organization called Grandma's House of Hope.' And she pitched it to me and we kind of just hammered out some details and ultimately birthed a very, very simple food drive.
But the overwhelming response when we kind of put that rallying cry to her customer base was that we were able to donate four carloads worth of canned goods that would go to underserved senior citizens. And so the care, the listening skill that I employed for McKenna was that I basically elevated her thought. And the net effect was our customers heard what we wanted to do and then they brought everything to life.
Just rewind literally a couple of weeks ago, we just punctuated something called Our Season of Goodness, which was a three-month-long campaign that 7 Leaves did nationwide across all of our stores. And each month, starting in October, was highlighted by an effort by which we asked our customer base to help us serve our community.
So October was a book drive. Those books that got donated went right back into libraries, the penitentiary system because inmates need literary enrichment. In November, we did a canned food drive where we visited homeless shelters, soup kitchens, and even the Humane Society because our four-legged friends need a little bit of help. And then in December, we had a toy drive where we visited local hospitals, partnered with Toys for Tots because we just felt that there shouldn't be any kid in our communities that don't get a little something.
So that's kind of like the net effect across all. But that all birthed from one 19-year-old out of our stores.
The key to success in building this culture for 7 Leaves has been enabling employees to be champions of good causes and important work.
"The initial response was not skepticism, but a little bit of just let's wait and see. Because when you kind of pitch this very broad plan to a cashier or even a store manager, there's this ideology of like, 'Well, how does that work?' But when we interlaced the ability for our store managers to be the champions of, 'Hey, you've got all these canned goods that you've collected and we're going to ask you to help deliver it to the soup kitchens or homeless shelters,' then it became very real to them, that they're like, 'I got the canned foods and now I'm going to a place that's maybe two miles away from me that these people need it.' And it just hit home the minute that they did that. And they realized the impact that they had in their communities because this company that they work for, 7 Leaves, allows them to do that.
And so when they visited those, again, homeless shelters, when they visited those kids in the hospital, when they visited and just provided a toy to that four-year-old, it became very real to them."
For a company of 7 Leaves size, building culture does come with a few challenges, namely how to make it genuine and not corporate feeling. And how they've done that is by recognizing that culture isn't just built once. It's an ever-evolving process that requires leadership to show up every day and live their values.
"Many companies, and I included, being part of those past regimes have always tried to create culture. And to use Donald Burns' statement, 'Culture is an inward-facing component. Brand is an exterior-facing component.' That some of the challenges that we experience because a large proportion of our workforce skew younger is the ability to share this ideology sincerely and with authenticity and integrity. We didn't want it to come across as feeling too 'corporate.' We didn't want to cascade information devoid of tonality or intention.
And so we were very methodical about how do we want to share this philosophy in a way that resonates with them? And so that really kind of had a lot to do with just being where they received their information. There was a ground and pound where we were visiting stores, doing a store tour, connecting with the staff in that way. So there's human touch there. It was making ourselves fully accessible by way of outside of the store and sharing that these are your access points to us.
And then, like all things with that generation, they're very good at calling things out that don't feel right. And so when we 'broadcasted' a lot of our activities around the Culture of Care, we wanted to do so that incorporated them versus we were from a position of ascension. And so when they see folks within their community of team members, there's a certain validation and credibility that's associated with that. And so we were very methodical about that.
And there really wasn't a whole lot of pushback. However, there has been challenges associated with consistently maintaining that with the revolving door of team members that our brand as well as many other brands have. Average turnover for our segment is anywhere from six months to nine months if you're lucky. And so when you have that to contend with, there is a discipline and let alone a certain sort of conditioning that our leadership team has to have, that we invested all that time and then the person separates and then now you have a new person and you got to continue with that momentum. And so that's been not easy to be brutally honest, not easy at all."
Recommended Reading: Restaurant Employee Turnover by City and State + Restaurant Retention Playbook
7 Leaves investment in building a Culture of Care has had ripple effects throughout the entire company. Beyond resonating with their customers, the culture they continue to build every day both attracts and retains employees that enable 7 Leaves continued success.
"It definitely has been a retention strategy for us when we kind of hack and slash it, but it's also an acquisition strategy for us. But I think moreover, I would never say that we're impervious to I guess labor 'shortages.' One of the things that we recognized through our own Happiness Index, which is what we call it, is that if you don't keep your team members engaged, they will go elsewhere. And that's just the nature of the animal. And respectively speaking, a lot of younger team members don't really have any aspirations of staying within the industries. Like you said, they're transitory and it's a revolving door.
So our belief here is that how do you make the restaurant industry a viable option to someone who is their first touchpoint? And I remember back in my days in operations, I was a store manager, and I saw my DM come in and I was just extremely impressed and say, 'I want to be that one day.' And then my DO came in, I'm like, 'I want to be that one day.' And I became a restaurant person for life.
You don't necessarily see that love affair for a lot of folks simply because they have other ambitions prior to even coming into us. And so one of our company goals, as we call it, and we utilize the teachings of Gino Wickman's Traction, is to really elevate the store manager persona in which our team members can say like, 'Hey, this is a viable thing for me.'
We're contending against restaurant counterculture and we've done this to ourselves to be brutally honest. But to really make this viable for many younger folks who then become the next wave of our restaurateurs is to ensure that, yeah we can do things a little differently now and it's just a matter of showing you. We haven't really done that as well as we'd like to.
So this year, we are actually very surgical on how we create this narrative, and it's a matter of putting some store manager biographies together and, again, showing them and architecting the story sincerely, of course, in by which they see, oh wow, this is something that I can absolutely do. We want to kind of layer in additional store manager fringe benefits. And then really put the microphone square up in recognition of, 'Hey, when you're a top performer, you are definitely not only going to get rewarded but praised and revered.'
And so when it comes to even our bonus structure, it could be something as simple as a direct deposit into your account, or it can be our CEO driving around meeting with the managers face-to-face with all of the team members around and seeing like, 'Hey, here's a check. Thank you for everything that you do. And I just wanted to let you know.'
So those are the kind of things that we're percolating so that people can begin to resonate with this industry a little bit more intimately."
Recommended Reading: How Employee Engagement and Career Development Can Help You Boost Retention
Now, back to that Happiness Index. It can be difficult enough to stay on top of one team's morale, let alone 42 across the country. The Happiness Index is how 7 Leaves is able to do a pulse check with their team members and make positive changes for the employee experience. Newton explains how they figured that out.
"That's a self-probing the good, the bad, and the ugly type of survey that we send out to every single layer of our organization. I, fortunately, don't have the unenviable task of hulling and cultivating all that data. But like I had mentioned before, because our audience is very vocal, oh, they let us know everything about what they like and what they don't like.
And so when you come across leadership teams, the exercise of just capturing the data is one thing, but really where you want to back load a lot of that discovery is like, so what do you do with that data? And so we've gotten baseline numbers of how happy our team members are. And then cultivated themes by which we really feel like, hey, we can act upon these little things and kind of take care of some of the low-hanging fruit. But then there are these broader themes that definitely require some attention.
And we're not trying to do any sort of smoke and mirrors. We want to acknowledge and just say, 'Hey guys, we heard what you said. This is what you guys said and these are the things that we're going to do and we're going to hold ourselves accountable as a leadership team. These are when we're going to make these things happen.'
And so, again, like I kind of erred on before, there's a whole look-and-see pattern because they want to know, all right, let's see if this actually happens. And we've been very open and honest about things we can do and things we can't do. And we typically want to over-deliver and under-promise. But respective to that, we really want to ensure that our team members feel 'happy' at what it is they're doing because at the end of the day, they translate that over to our customer.
And so if there's anything that we really pay close attention to is that we do it on an annual basis and we might kind of button that up to maybe a biannual just so we can get a better pulse on things. But just going through the motions and mining all of that rich data, it's a thing, that's for sure."
One such change they made was a wage upgrade for store managers. The teams at 7 Leaves will also be implementing Lunch and Learns where team members can interact with subject matter experts within the company. Think things like real estate, finance, and leadership beyond just working in the cafes.
"One of the things that we're going to be birthing in greater consistency and intention is our what you call Lunch and Learns. This is not a new idea, but basically allowing our teams to interact with subject matter experts within the company and just sharing with them a little bit of like, 'So how did you get into real estate?' 'How did you get into HR?' And just kind of doing that in a way that allows a pathway. Whether you want to stay with us or not, that's cool, but at least we can transfer best practices so that you can move on your merry way and just know how to go about being a successful person in society."
And on the pay side, 7 Leaves is using their wealth of customer feedback to create incentives for manager bonuses.
"Our bonus structure is fully locked and loaded to reward top performers, and more so now than ever before. We just recently revitalized our customer feedback and kind of transformatively moved over to what we would call a Net Promoter Score strategy, which is not new in this industry, but new for us here at 7 Leaves, and therefore really making the customer voice even more important than it was before relative to just in-store metrics and sales.
But I think our managers feel that the bonus structure is not only fair, but supplemental in a lot of regards to just their base wage. And so there was very much a lot of care put into creation of the bonus. And just really it is what it is relative to if they blow it out of the park, oh, you're going to get rewarded, and if you were just shy, you know exactly how to get over that so that you can be part of that audience."
And to collect all that feedback, 7 Leaves uses a software tool called AskNicely to pull feedback from review sites and ordering platforms to make rewarding those top performers a bit easier.
"We utilize a platform engine called AskNicely, which essentially pulls in all of that data from a digital ordering and in-store experience and from various digital platforms. And so it was a no-brainer for us because before we were just mining that information manually."
With all of that in place, it shouldn't come as a surprise that 7 Leaves is on an upward trajectory. And they're also walking the talk and continuing to build upon their Culture of Care in 2023.
"We just recently launched our hot drink menu, which has been a paradigm shift for us here at 7 Leaves. But definitely be on the lookout for some very awesome collaborations. One of the ones that we've got percolating under the hood is with an online gaming community that really fosters a safe space for women gamers. And I would honestly say more than half of our customer base are that gaming community. And so this is a collaboration made in the stars in which we partnered up with them during Women's Empowerment Month in March to really do some big things."
Simple to set up, easy to use. Give your restaurant the team management tools they need to be successful. Start your free trial today.
Start free trial
No credit card required
D. J. Costantino
Hi! I'm D.J., 7shifts' resident Content Writer. I come from a family of chefs and have a background in food journalism. I'm always looking for ways to help make the restaurant industry better!