Chipotle Mexican Grill

Chipotle Mexican Grill

Chipotle Mexican Grill is a restaurant chain with locations in the United States, Canada, France, the United Kingdom, and Germany (Chipotle Mexican Grill, 2017). The company has managed to open over 2000 fast food shops worldwide, making it one of the most popular restaurants.

Services Provided

They are well-known for their salads, mission-style burritos, and tacos crafted using local and fresh ingredients. Customers, fortunately, have the option of selecting the particular ingredients they desire in their snacks, giving them complete control over the meal purchased (Chipotle Mexican Grill, 2017). From early morning through late at night, all Chipotle locations serve all meals. This company also provides culinary services to individuals interested to learn how to make their products at home or for professional purposes.

A Brief History

Steve Ells, the founder and the chairperson of chipotle started the first outlets in 1993. Its headquarters is in Colorado in America; the primary objective was to portray that food served within a few a minutes was not necessarily the unhealthy fast food most people consume (Chipotle Mexican Grill, 2017). Their concept was to use raw ingredients, classic cookery practices, and unique interior design to introduce the world of exquisite dining to the realm of quick-service eateries. Over the years, the company has been devoted to discovering the best food constituents available from farmers, animals and the surrounding that remains fundamental in their commitment to “Food with Integrity,” which is the organization’s slogan.

Competitors

Key competitors for Chipotle include Taco Bell Corporations, Qdoba Mexican grill, and California tortilla. These companies are always stacking up against Chipotle based on their sales, market control, growth, and profitability mainly because they sell similar products (Comoletti, 2017).

SWOT Analysis

Strengths

Since its foundation, chipotle is known for its solid brand reputation where customers are assured of quality food and services. As a result, it has experienced rapid growth since its stock went public in 2006; in fact, the chairperson reports positive earnings and revenues annually since its initial public offering (IPO) (Publishing, 2017). The second is its ability to maintain high revenues and profits regardless of its shortcomings in 2015. Another competitive advantage is quality ingredients that have retained customers; in modern times, people are vigilant about their diet and time thus a fast food restaurant that offers healthy food in a short span of time fits the current living style.

Weaknesses

The weakness associated with Chipotle is the high prices of their food owing to the natural components used. Notably, organic resources are not readily available because most farmers use chemical fertilizers to farm; this makes antibiotic-free materials expensive (Publishing, 2017). The second weakness is their limited menu due to their attention on burritos and tacos. Moreover, they are concentrated in America compared to other nations thus limiting their market base.

Opportunities

Available opportunities include an introduction of new products in their menu to provide their clients with variety to choose. Another option is to expand their existent products to retail supermarkets to increase sales. In a bid to create a vast customer territory, they should spread their outlets worldwide mainly in areas where Mexicans are foreigners to make them feel at home. The limited representation in Canada and Europe has little potential cover international markets.

Threats

Possible threats include competition from similar food companies. Unfortunately, Chipotle faces a severe risk to lose it image due to the E. coli bacteria epidemic in a few of its restaurants in late 2015 (Publishing, 2017). Consequently, this outbreak triggers more pressure from the public; Chipotle management is required to lay off their staff in the food safety sector to portray a commitment to decent service for their customers. Losing experienced workers might expose the entire food chain to more safety issues that it is experiencing now. In future, there is a possibility to reduce food prices despite the expensive resource chipotle use to make them. Mainly, most of their competitors offer similar products at lower rates leaving them in danger of less revenue if they do not strategize on that matter.

Marketing Plan Focus

Based on Chipotle’s SWOT analysis, the food chain has a business opportunity to supplement its menu. Notably, there are no refreshment drinks to accompany their burritos hence most customers end up purchasing drinks from other fast food joints to complete their breakfast, lunch or dinner. Since one of the chipotle business principles is people’s health and quality products, Mexican citrus drinks such as Sidral Mundet Green, Jarritos Lime juices and citrus green tea for breakfast, lunch and dinner dishes respectively area better option for drinks compared to traditional sodas, which have high calories. Therefore, a marketing plan is essential for such a development to promote these beverages and notify their customers about the new improvements in the menu (Kolbina, 2015). Ultimately, healthy products have the power to attract consumers who are continually cautious of their calories and chemical intake to lead healthy lives.

Segmentation Approach

The demographics are the youth and young adults because they represent the leading population and consumers of fast foods. Some of the young people are in colleges while others work in towns all day, so they take most of their meals in fast food diners. As a result, this marketing plan aims to target this particular age group as it already symbolizes 70% of their customer base; in consideration to their behavioral trends, citrus products will save them from their usual sugary sodas, which are gradually damaging their well-being (Comoletti, 2017). With these drinks, they are assured of a more safe habit that will not lead them to chronic ailments which include diabetes and hypertension in their prime years.

However, other customers in such as children, adults and elderly are also incorporated in this plan because they also contribute to the Chipotle’s revenue. With the growing economy in most chipotle locations, most working class individuals barely have enough time to prepare meals at home thus prefer to take dinner at fast food joints. Psychographics in such economies show that most people crave healthy meals prepared in a minimal period; this makes organic fast food eateries an option for them (Comoletti, 2017). They have a mindset that all edibles must either contain limited sugars or sugar-free and no chemical or hormones that would trigger health problems; also, this perception is transferred in their children’s diet and they would opt for similar drinks when they hold parties for them or just spending leisure time as a family. The ”eat right, live long” slogan that most populations around the globe have adopted guarantees sales for the citrus drinks.

Target Definition

The target audience is mainly the youth ranging between 18 to 30 years. Promotional materials will further include audiences with events such as children fun days and birthdays that require burritos and citrus drinks; these beverages will favor individuals who love spending their leisure in coffee shops and informal hangouts.

Positioning Statement

For the youth generation, it is a celebration every Tuesday and Friday in Chipotle where you get a free bowl burrito after purchasing two citrus juices of any flavor of your choice. Buy diet drinks made from organic fruits and enjoy a free snack.

Marketing Mix Discussion

Product

The focus area of this marketing plan is to offers existing and the new regulars a chance to consume a wholesome diet. Citrus offers varieties such as oranges, lemons, and grapefruits; it creates a balanced meal when served with other food available in Chipotle allow the food chain to serve food without unnecessary calories and fat. Furthermore, these products have components that ensure every sip is revitalizing and its components lead the hospitality industry concerning appetizers and cocktails. Other benefits of citrus include seasoning foods, salads; their peels are also helpful since they contain oils making the final products more natural.

The specific products in this plan have a reputable history in the Mexican culture. Sidral Mundet is suitable for both kids and adults due to its ingredients without additives or preservatives; it is famous for its health, nourish benefits and treatment for stomach problems. Jarritos has been in existence for over 50 years and celebrated as Mexican’s first refreshments. They had natural sugars and made in different flavors to suit its audience’s preferences; they all assist in the digestive system and curb any emerging diseases in the body. Citrus tea is eminent for colds and perfecting vocals; like most citrus drinks, it keeps diseases in check and enhances immunity in the body.

Price

Chipotle pricing technique for citrus beverages should be much lower compared food prices. Unlike the scare raw materials used to make burritos, citrus fruits are available in farms worldwide; in fact, the organization has an opportunity to redeem their high-cost reputation and price their juices within the range of their competitors. As part of business strategy, Chipotle plans to introduce three flavors at first namely Sidral Mundet Green, Jarritos Lime, and lemon tea, which will trade for $4, $3.50 and $3 correspondingly (Chipotle Mexican Grill, 2017).

Notably, the positioning statement is expected to attract customers to purchase both flavors to get a burrito. Therefore, Tuesday and Friday sales are expected to rise as consumers get their chance to try the new product and make an informed decision on their preference between the two citrus brands. Another pricing plan is different packaging where the drinks are put in six packs and trade at a cheaper offer compared to buying one at a time; this means consumers have the privilege to take away some and consume later. The six-pack is anticipated to cost $17.50 for Sidral drinks and $17 for lime drinks (Chipotle Mexican Grill, 2017).

Promotion

It entails creating awareness to the intended audience. It is not easy to convince an individual to pay for a product they have never had an experience with before thus the marketing specialists deployed to execute this work should be persuasive enough to facilitate sales. Regardless of the healthy components in these drinks, the promotion tactic determines whether they will fly off the shelves. The first option is to use the client’s database available in the Chipotle’s system to retrieve their contacts and inform them about the new development on an individual level prior the launch of these products. Personalized services make them feel appreciated and recognized as worth contributors at the company. The messages will act as teaser advertisements to arouse curiosity and trigger customers to find out more about the new product; this will create the suspense needed to attract people to the idea. The message that will also trend on social media would probably read as ”anticipate more healthy developments at Chipotle Mexican grill within a week accompanied by offers on selected days.”

Another marketing approach is the burrito offer meant to portray the management’s effort to the team endorsing the product; since the food chain is already famous for its burritos, giving some free after purchasing citrus juices for a few dollars should alter the focus into consuming more drinks. Billboard advertising would also reach regulars and other clients to try the beverages. Since this form of publicity is visible to an audience using major roads on a daily basis, the ad can attract many people. Additionally, depending on the graphic design and pictures on the notice, billboards can lure individuals who might not have an interest in citrus products.

Place

The citrus juices promotion would take place in all Chipotle outlets including in their ”ShopHouse Southeast Asian Kitchen” and ”Pizzeria Locale (Publishing, 2017).” However, the sales will begin in the shops within central drive through roads to analyze the public reaction to these drinks. Virtual platforms such as their website and social network accounts will be used to target the youths who are known for spending endless time online. These platforms would offer extra information and update buyers on prices, locations, and offers; social media accounts provide feedback on people’s thoughts enabling the management to measure the new performance regarding sales. Feedback shed light on the factors influencing clients’ decision and can be addressed if they are within the management’s reach; as a result, the location any organization chooses for marketing, either physical or virtual, should influence its new venture positively.

Success Metrics

The three achievement metrics appropriate to measure this marketing plan include the intensity of the citrus fruits used to make the juices. There is a list of benefits linked with tangerines, limes, and oranges among other similar fruits such as immune boosting due to the vitamin C content, used to treat flu. They have fiber that lowers cholesterol and regulates sugar level; also, citrus promotes the heart’s well-being and contains low glycemic index that provides a stable energy feeling an extended period (Comoletti, 2017). Surprisingly, these fruits have potassium essential for balancing minerals and reducing stroke risks in a human body; another advantage is that they keep the skin hydrated because they have a high percentage of water, consequently, maintaining a youthful look. Alongside other health merits, citrus drinks have the potential to flourish in the fast food restraint owing to their smooth preparations.

The next metric is scrutinizing the probable increase in earnings that citrus products would capture. The best way to measure this would be a comparison of sales on Tuesday and Thursday when people are offered extra benefits compared to other days of the week. Alternatively, this analysis can be done through social media where one can regularly check if online participants are discussing the product on their timeline and the number of people following a conversation when it is posted. If there are many participants, it implies that the public has reacted positively and even though the change might not reflect immediately on the sales, there is hope for better business as opposed to no impact at all.

The third metric is market share analysis. When Chipotle’s competitors do not have the same product, Chipotle will not share citrus consumers until their competitors derive a strategy to outshine their drinks. Since the food chain aims to gain control over the market, an introduction of unique products in their menu is a wise start; though their primary target is the youth, citrus fits in all age groups thus an advantage over other common snacks in fast food restaurants. Notably, to attain the largest market share, this company must balance its internal and external business environment to ensure a flow of business without interruptions (Kolbina, 2015). The internal business attributes entail finding quality raw materials and exercising a safe production process; staff members in the kitchen are responsible thus, and they management should have appraisals to measure their performance. On the other hand, the marketing team will handle the external business environment through scrutinizing any negative forces that would affect the sales and opportunities available to advance profits. Since such factors are in place to measure success, it is evident that the citrus juice idea has a promising growth scheme.

International Consideration

For any organization to gain attention in the foreign market, it needs to understand the social environment and offer products that favor the society’s beliefs. The social surrounding entails a society’s customs and behaviors, which is defined as an artificial construct that people adopt. Since Chipotle operates in a social environment, mostly in America and Europe, they need to make foods and drinks that people perceive as acceptable for their daily intake (Kolbina, 2015). Over the years, most citizens in these continents have tried to maintain a healthy diet to reduce lifestyle diseases that have become so rampant. Moreover, doctors have significantly contributed to this notion owing to the numerous researches conducted on the death causes for many people; sadly, most studies revealed that cancer was the number killer and bad living habits were attributed to causing this disease. In a bid to save the society, a healthy lifestyle was adopted irrespective of its high maintenance. Since Chipotle’s inception, it has satisfied people’s desire hence its popularity, even with the citrus fruits, the company can spread into other continents because the entire world acknowledges consumables fit for human well-being.

The second international concern is building a strong culture of excellence within an organization. If a business creates internal standards practices to guide all employees, it gains an acceptable reputation in the public in which consumers are convinced that their products are recommendable. In the same way, Chipotle has built an image of quality and organic foods; therefore, this new venture will receive a positive reaction and create an opening for them to expand into new regions and dominate more markets. Advisably, all internal stakeholders in this food chain business should guard their reputation to avoid another disaster that would damage their character of eminence; it requires years to build a lasting image but only takes a day to destroy it (Comoletti, 2017).

The third consideration is governmental interruptions such as inflations, regulations, and interest rates that affect customer choice and spending. For inflation, governments change interest rates when they print a lot of money hence weakening their currency; this causes a rise in prices affecting consumer’s purchasing behavior. It further reduces sales because most of the products sold in these food joints are purchased using disposable income. Governments also affect interest rates through increased borrowing rates in the business community. High levels decrease consumer spending; in such hard business times, Chipotle would opt for investment options to maintain their operations. Regarding hygiene, Chipotle is committed to the regulation to maintain health standards and comply with all other business policies set by their government.

Conclusion

Undoubtedly, Chipotle Mexican Grill is famous for its burritos among other delicious fast foods. However, every organization has a responsibility to grow their business annually despite their achievements in previous years; furthermore, the environment offers openings to create a new business or advance the existing operations. In effect to this, Chipotle management wishes to supplement their current diets; this idea will contribute to the company’s revenue and earn a competitive advantage over their competitors. After deliberations with internal stakeholders, the management concluded that they should introduce new citrus beverages and the marketing team should execute this task.

In my opinion, I would urge the accounts department to consider this plan in their budget because I am confident that this project is worth the investment. In fact, the monies invested in marketing the citrus juices will be gained back in six months and henceforth, generate more income for the food chain. Nonetheless, investors and other shareholders might raise concerns about the risks involved in starting this growth plan, but opportunities linked to this venture are more compared to the threats available.

References

Chipotle Mexican Grill. (2017). Chipotle.com. Retrieved 6 September 2017, from https://www.chipotle.com/

Comoletti, J. (2017). America’s Favorite Fast Food Chains. Retrieved from http://www.businessinsider.com/chipotlemexicangrill­customer­satisfaction­2014­6

Kolbina, O. (2015). SWOT Analysis as a Strategic Planning Tool for Companies in the Food Industry. Problems Of Economic Transition, 57(9), 74-83. doi:10.1080/10611991.2014.1088367

Publishing, V. (2017). SWOT Analysis: Chipotle Mexican Grill, Inc... Valueline.com. Retrieved 6 September 2017, from http://www.valueline.com/Stocks/Highlights/SWOT_Analysis__Chipotle_Mexican_Grill,_Inc_.aspx#.Wa-tj9QjG00