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Chipotle bets on a different sort of loyalty program

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Chipotle is hoping to win back customers with a limited-time loyalty program that rewards guests starting July 1 for the frequency of their visits.

Patrons must visit at least four times per month during the Chiptopia Summer Rewards promo and spend at least $6 each time to qualify for the lowest-level prize, a free entree. If they stop into a store another four times in a month, they earn a second free entree and move up in membership rank, from Mild to Medium.

During one of those additional four visits, the Chiptopia member can claim their free burrito and have that count as one of their purchases. Essentially, Chipotle will be giving away two burritos or bowls for purchases of at least $42.

Another three visits in a month bags a third free entree and pushes the customer into the elite Hot group. 

The promotion and loyalty program mashup runs through September. A participant’s visit count resets at zero on Aug. 1 and Sept. 1.

Qualifying for all three months as a Medium member earns a patron an additional prize of a $20 credit for Chipotle merchandise sold in the chain’s online store. Guests who qualify as a Hot member for all three months are entitled to a free catered meal for 20, a value set by Chipotle at $240.

Every aspect of the program is intended to bolster traffic rather than check size. For instance, customers must visit a store to get their Chiptopia membership card. If they do so before July 31, they get a free order of chips and guacamole with their first entree purchase.

In past conference calls with financial analysts, Chipotle executives had cited the loyalty program—the chain’s first—as a key component of the brand’s turnaround program. After a string of food safety problems at the end of 2015, same-store sales for the chain dropped by about 30%. One of the major problems, management said at the time, was the loss of what had been the concept’s highest-frequency customers.

Chiptopia is intended to coax those choice patrons back into visiting regularly.

Other turnaround tactics in the offing include giving takeout customers the exact time they can pick up their orders.

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