Chipotle Mexican Grill wants to be more visible.
The Newport Beach, Calif.-based Mexican chain was “invisible” in recent years, CEO Brian Niccol told investors at the ICR Conference in Orlando on Tuesday, which ultimately hurt the brand’s sales.
“The company just went quiet,” Niccol said. “And reactive, rather than proactive, on sharing what the mission is for the company.”
Under Niccol and CMO Chris Brandt, Chipotle has shifted much of its marketing, pushing delivery and advertising much more on national television.
The company said it has shifted a lot of its advertising from local ads to national ads. Executives told investors on Tuesday that the marketing has been much more visible to customers even though Chipotle doesn’t spend any more now than it did three years ago—3% of sales.
“I have friends and family who say, ‘Chipotle is finally advertising,’” CFO Jack Hartung said. “We’re spending the same amount. But the marketing team has done a great job of taking the budget and putting it where people are going to see it.”
Marketing has been one of the areas where Chipotle has made the biggest changes. In past years, the company had relied on local marketing and focused on innovative, web-based videos to promote its message of sustainability.
Chipotle used the college bowl season to advertise delivery, the “Chipotle Free Delivery Bowl.” The chain and Door Dash offered free delivery and the company’s ads were broadcast during every bowl game.
“That’s been a huge home run,” Hartung said, adding that delivery is “sticky” with the company’s customers because the chain’s burritos and bowls travel well.
Chipotle is promising more marketing this year, including a new loyalty program that is currently in test.
Niccol said that enrollment in the program durng the test phase has “exceeded our expectations” and that many of the enrollees are “light and lapsed users” that the company considers vital to its future growth.
Chipotle plans to expand delivery nationally at some point this year. “We’re very optimistic about what this can do for the business going forward,” Niccol said.
Marketing is an important component in the 2,500-unit Chipotle’s efforts to rebuild its economic model following three years of weak sales. Niccol, hired last year from Taco Bell, is known for his marketing prowess.
“If you say Chipotle, people have heard of the brand of course,” Niccol said. “But if you ask what the brand is about, they have a hard time articulating that. We’re going to be much more front and center.”
But there are other elements, too. Chipotle continues to work on building digital orders, adding a second make line in its restaurants and pickup shelves for customers to get their online orders.
Niccol also said that the company has hired “key leaders in supply chain, development, marketing” and finance. “All areas have really elevated the leadership, talent and accountability,” he said.
And the company views its assembly line as “the moment of truth.”
“When you come to the restaurant and you move down from the tortilla to the cashier, if we win at that line people come back,” Niccol said.
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