Why Are We Led by Free Chipotle Burritos?

We’ve published a post re: Chipotle’s brand pratfall (“Humanize Your Brand: Branding & Marketing Lessons from Zulily & Chipotle“), hinting at a brewing marketing strategy to make amends with a cautious public and restore their brand image.

The plan centers around one idea: free burritos. And now MORE free burritos. According to Business Insider:

The company is sending out 21 million direct-mail coupons for free food in the coming weeks, Chipotle executives said Wednesday at a conference in New York. The coupons will expire on May 15.

The chain said it had success with its most recent free-burrito promotion. About 5.3 million people downloaded the mobile coupon in February, with 2.5 million redeeming the offer.

It’s been effective at raising sales, particularly in middle America.

“Free burritos—turns out it works,” Chipotle CFO Jack Hartung said. “It brings people into the restaurants.”

You can almost envision him shaking his well-whatever corporate head in disbelief at an entire culture of gullible child-minds.

MORE FREE BURRITOS? I must be dreaming!

I knew a guy once who was the veritable Pied Piper of Chipotle, eating there exclusively. Was his whole routine disrupted when the chain suffered its public health humiliation? And was he over the moon when the coupons rolled out?

Perhaps the success of the promotion says something about consumer culture, the creatures of habit so many have become, their response to non-creative solutions being just as motivated as their reaction to creative ones.

Yes, please, free, gimme—But does it build brand loyalty, or promote senseless consumption?

BOGO Burritos? Is this heaven?

Chipotle’s next move, according to the Business Insider article, is to shift to buy-one-get-one burritos over the summer. (Because if there’s a time I want to eat twice as much black bean burrito, it’s when it’s 95 degrees in New York.)

Here’s the over-encompassing issue: Do we accept the corporate mea culpa because we’re that feverish to get something back from a system designed to take? Not that I feel Chipotle should be shamed forever over 50+ sick customers across 13 states—although that strikes me as an awful lot of states.

In fact, I don’t even shun the idea of a coupon: They work, that’s why they’ve withstood the test of time. There’s just a part of me that feels like, with all that strategizing and money, they should have to try harder.

Let’s put free burritos in perspective: Are coupons a viable long-term solution?

Sure, they’re getting a free burrito NOW, but when they have to choose to eat somewhere in the future, will they come back? What’s the customer retention strategy—other than EVEN MORE free burritos?

As with any sales strategy based around free, if you keep hitting the same target audience with the same offer, what you’re giving away will lose effectiveness over time, until the cost to conduct the promotion can only minimally offset the resulting revenue.

And from a branding perspective: Are free burritos enough to erase the tarnished public perception of the brand and restore brand loyalty? (And wasn’t that the point?!)

Update 4/23/16:

Business Insider is reporting that the $70 million spent on Chipotle’s free burrito strategy is working, if you can call this success:

Customers using coupons to get free food from Chipotle are eating at the chain more than twice as much as customers who haven’t received a coupon, according to a new survey.

The 41% of respondents in a new survey by investment bank Cowen & Cowen who received a coupon from the struggling burrito chain visited Chipotle an average of 3.8 times over the prior 30 days, reports the Wall Street Journal. In comparison, the 59% who hadn’t received a coupon visited an average of just 1.4 times.

I would hardly say that’s really proven success; rather, it’s more “just about right” or as this gentleman says:

Chipotle’s coupon strategy “is born out of desperation rather than choice,” Neil Saunders, CEO of retail-consulting firm Conlumino, told Business Insider.

Update 7/3/16:

The Motley Fool is reporting that Chipotle aims to launch their summertime loyalty program—Chiptopia Summer Rewards—and add chorizo as a new menu item. Give me a moment to contain my excitement…

Watch how they’ve structured the loyalty program:

  • For three months, customers who purchase $6 or more at least four times per month earn a credit for a free entree.
  • Buy more, get more. (How novel.)
Is it any wonder their chief creative officer Mark Crumpacker was just busted as part of a NYC cocaine ring?

Perhaps his creative attentions were being otherwise engaged.

Photo Credit: cherrylet via Compfight

Management consultant and brand strategist for small teams. Fan of dark tea, thick books, peace, and unity.

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