After sneering at fast food for decades, Chipotle has decided traditional quick-service chains may not be as brain-dead as it alleged. The home of Food with Integrity is showing a change of heart with such moves as trying a drive-thru, hiring a quick-service vet and adapting the sector’s standard food-safety strategy.
Those nods to standard quick-service practices follow a shift to conventional marketing approaches, including the adoption of TV marketing and adding assumed traffic drivers to the menu.
The change of heart accelerated during the second quarter, when Chipotle’s turnaround slowed to an 8.1% gain in same-store sales, after posting a 17.8% leap in comps for the first quarter. Certainly year-ago comparisons were not a difficulty factor; same-store sales dropped 23.6% for the second quarter of 2016, the result of a 19.3% free fall in traffic.
The problem last year was the public’s lingering concern about the safety of what Chipotle sold. Fears of being sickened by the chain’s naturally sourced fare were stoked by a series of E. coli outbreaks and a widespread norovirus infection.
Last week, a Chipotle had to be closed because of another norovirus infection. In discussing the chain’s second quarter, which concluded before that outbreak, CEO Steve Ells apologized for the one-store problem in Virginia.
He also stressed that the chain has adopted a Hazardous Analysis and Critical Control Point safety strategy—in effect, focusing on where food is most likely to be contaminated. It’s the industry standard for the quick-service sector, as popularized by the late David Theno after Jack in the Box suffered the worst food-safety lapse in industry history.
The increasing parallels between Chipotle and traditional QSRs don’t end there, as Ells illustrated. Among the personnel changes adopted during the quarter was the hiring of Scott Boatwright, the Chipotle chain’s first chief restaurant officer. Boatwright previously worked for Arby’s, a chain that celebrates its positioning as a midmarket fast-food chain.
But the biggest implicit acknowledgment that traditional QSRs may be outmoded was Chipotle’s announcement that it intends to try a drive-thru, even if it’s calling that service format something different (it’s a “vehicular pickup window,” said CMO Mark Crumpacker). The first Chipotle to use that method of getting orders in customers’ hands will be in Ohio.
Not coincidentally, that’s the location of Tasty Made, Chipotle’s new better-burger concept. The prototype features a drive-thru. A number of accounts hold that Chipotle was surprised by the volume of business that came through that channel.