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Burritos and Brand Crisis Management

 -  6 min read

Let’s get one thing out of the way first: I enjoy Chipotle. There are few things in life better than a steak burrito complete with all the fixings and, of course, let’s not forget the guac. Chipotle is a brand that has built its name with a reliance on fresh, often locally sourced ingredients. It goes without saying that the food is cooked and prepared right in front of the customer (usually while that customer drools in anticipation).

But in case you haven’t read the news, Chipotle has had multiple food scares lately, beginning with the E. coli outbreak at the end of October and even including a norovirus flare-up that struck dozens of people in Boston in December. (Although Chipotle denies it was connected to that virus.) This led to a 30% drop in December sales as well as a 42% drop in shares over the last three months.

This is not the first food-related scare at a major restaurant chain in the US. One of the biggest occurred back in 1993, when over 600 people became ill and four children even died after consuming contaminated meat from Jack in the Box. Believe it or not, this event did not doom the fast-food chain. The company survived and, amazingly, was back into profitable territory only a couple of years later.

So how has or will this recent outbreak affect Chipotle’s brand? Their slogan, “Food with Integrity,” is now compromised, so that will probably have to be changed. The company has lost revenue, as we noted earlier. But Chipotle does have an enormous following and basically even invented their own category: fast casual Mexican (one could argue that they essentially invented the concept of “fast casual” itself). What Chipotle cannot change are its core values—using locally sourced, non-GMO ingredients and also “supporting efforts to shift the future of farming and food.”

So what’s next for the burrito king?

Chipotle is gearing up for a massive marketing campaign, set to launch this month, to lure back its customers. Reading the tealeaves and looking at the past, I can say with certainty that the marketing budget dollars will be digging into the profit margins, making it look like Chipotle is still struggling, but this is a standard practice if Chipotle would like to rebound.

The company will need to make sure that it answers every question from the public about this outbreak. The only way to get out from under this is to be completely truthful and lay out a plan that informs consumers that an event like this will not happen again. Sure, they could give away a ton of free food (which I’m sure they will do) to get people back into the restaurants, but education is the key to keeping them back. Jack in the Box revamped its food-safety protocols by hiring a high-profile microbiologist, but, more importantly, it began conducting random tests every fifteen minutes to detect E. coli in its beef (incredibly, this wasn’t tested for at all previously).

This (I assume) is the reason that that Chipotle will shut down all restaurants on February 8th for a “company meeting.” The company will probably go over a step-by-step program for ensuring their food is of the highest quality as well as how to answer any questions about food quality that might be asked when a customer enters the restaurant. But in reality, the company’s investment in its overall marketing message will be more important than that of the average store employee because, let’s face it, if you enter a Chipotle, you’ve more than likely already made up your mind that you are going to devour a burrito bowl. What this does help, though, is to reestablish employees as positive brand ambassadors. If the employees become frustrated or unhappy, then they fail to promote the business that they work for, thus diminishing the brand.

My advice to the “fast-casual” leader is to admit a serious mistake was made. In some way or another, Chipotle’s message needs to have this key ingredient. Truthfully, I think that the company will, without a doubt, rebound. The better question is, and this is directly tied to the strength of its upcoming marketing campaign—how long will it take?