Chipotle promotes sustainability to draw customers
Chipotle Mexican Grill Inc.’s success with hormone-free dairy products, naturally raised meat and local produce has the restaurant chain taking its message to a broader audience.
The Mexican-inspired fast-casual chain released an animated video to movie theaters last week and hosted the first of many food-and-music festivals.
“We think the more people understand where their food comes from and the impact on independent family farmers, animal welfare, the more they’re going to ask for better ingredients,” said Chipotle founder and co-Chief Executive Officer Steve Ells.
The Denver company has shown that a focus on local produce and animal welfare can be done in a fast-food setting. It is one of the fastest-growing stocks in the restaurant sector. For the most recent quarter, Chipotle’s same-store sales, a key metric of restaurant health, increased 10%.
Given this rapid growth, Chipotle executives and industry experts maintain that it’s time to up the ante on its marketing.
Through consumer research, the burrito chain uncovered that while many consumers think “organic” and “local” are the kinds of attributes to have associated with their food, only 30% were willing to go out of their way for what Chipotle calls “food with integrity.”
So the company is preparing to tug on customers’ heartstrings, with an animated video that began playing on 10,000 movie screens last weekend. Set to Coldplay’s “The Scientist” as performed by Willie Nelson, the story centers around a farmer who builds his pig business into a large factory only to decide to return to more natural methods. It’s already gotten 1.3 million views on Chipotle’s YouTube channel in just over a month.
“It’s time for them to move to the adults’ table,” Dan Dahlen, chief development officer of Weber Associates, a marketing firm in Columbus, Ohio. An advertising and restaurant industry veteran, Dahlen said that the chain seems to be following the “Starbucks model” of advertising, meaning that it has eschewed the traditional tactics.
“You have to eventually go on TV or some sort of mass media to keep your name top of mind and tell people what’s happening,” Dahlen said. “You can include social media to do that, but you can’t rely on social media to be your primary mode of communication.”
Started in 1993, and bolstered by word-of-mouth referrals and grass-roots marketing, Chipotle is now a $1.84-billion-a-year restaurant chain with more than 1,100 locations, and it’s beginning to embrace traditional tactics.
The animated video is part of a new marketing platform called Cultivate. Chipotle last weekend hosted Cultivate Chicago, an all-day food and music festival featuring local gourmet chefs, to raise money for Family Farmed, a group working to expand production and distribution of local, sustainable food. Chipotle plans to host similar events in other cities.
Jim Slama, president of FamilyFarmed, said the proceeds will help the group in a variety of efforts, including increasing schools’ access to local ingredients and the development of an online program for independent farmers to create a customized food-safety plan. Meeting food-safety standards is a common barrier to family farmers looking to sell their wares to a company like Whole Foods.
The chain has established the Chipotle Cultivate Foundation to extend its reach beyond its restaurants by supporting programs focused on healthy eating and a more sustainable food supply. Willie Nelson’s Coldplay cover also is the start of Chipotle Music, an in-house record label.
Ells’ interest in sustainable farming isn’t led by consumer requests, he said. “It’s our belief that this makes for the best dining experience, and we’ve always believed just because food is served quickly or accessible doesn’t mean it has to be a typical fast-food experience.”
Ells is applying the Chipotle model to Asian food, with the recent opening of ShopHouse Southeast Asian Kitchen in Washington.
“If you look at what people are serving for Asian food in chains … it’s very sort of one-dimensional, sweet and sticky,” Ells said. ShopHouse, by contrast, he said, is “bold and spicy.”
Dahlen expects more restaurant concepts from Ells with the same formula.
