Chipotle Mexican Grill is a chain of fast casual restaurants that are found in United States, United Kingdom, Canada, Germany, France, etc. The main food products delivered by the restaurant are tacos and burritos. The name of the company has been derived from chipotle which makes it specialized in using the dry jalapeno chili pepper in the food items that are delivered to customers. The mission of the organisation the Food with Integrity, and it focuses on the utilization of naturally grown ingredients and serves more naturally raised meat than any other restaurant chain found in UK (Cole, 2010). It was founded by Steve Ells in 1993 and it has spread its chains in more than 500 locations all over the world.
From the case study, it could be understood that the company had been focused on food with integrity and it also follows an environmental sustainability mission. This has enabled the restaurant to source the best ingredients and also prepare those with hand and bring out the best taste of food items which can satisfy the needs and preferences of customers. The ingredients used by the organisation are naturally bred like the vegetables and meat and are properly overseen. The company thinks that with the development of each and every burrito, a better and health world has been cultivated (Gunelius, 2010). The organisation condemns the use of any synthetic substances other than fresh ingredients, fresh juice and fresh meat which can improve the taste of food and also make the company remain sustainable in terms of environmental aspects within the business environment.
The present marketing situational analysis of the Chipotle Mexican Grill is done so as to determine the strengths, weaknesses, opportunities and threats of the organisation too. The SWOT analysis has been done for the purpose of carrying out the marketing situational analysis.
Chipotle Mexican Grill is a well recognized restaurant brand in U.S., U.K., Canada and also the brand has grown and went public in the present days. It has positive annual revenue and earnings which have grown every year and in the year2015, there have been certain food safety issues but still the company has managed to post annual revenue and growth in earnings for about 10 percent (Hollensen, 2010).
There are nearly30,940 employeesand it uses also naturally raised meat and organic ingredients in cooking the most delicious and healthy food items which can keep the customers happy. There are many branch locations as well and thus it has established a positive brand image along with loyalty of customers too.
The brand has been publicized and advertisedand also environment friendly material in construction have been used so as to manage sustainable environmental aspects. There is also services of online order and delivery which can make the customers get the food delivered to their doorstep after making orders online (Hollensen, 2015).
The prices of food items are comparativelyhigher as because the natural and organic ingredients are used. The choice of menu is limited and the company’s major presence in UK and Canada. Nearly 99% of Chipotle restaurants are dependent upon the U.S. market and recent results showed that the growth has also slowed down. The organisation is reliant on the purchase decisions made by the consumers and hence, the results might changes in macro-economic conditions which is a major weakness of the brand (Hsu & Powers, 2008). Due to this the U.S. economy has slowed down, as because the typical tab at the restaurants are mostly higher than the traditional burger and taco chains present there.
The major scopes and opportunities include business expansion in untapped regions and countries and also addition of more food items in the menu. There has also been growth in health consciousness among people, so the Environmental Sustainability Mission has been proposed by the restaurant in order to make sure that good quality and healthy ingredients are used to make tasty and healthy food. Chipotle has not entered the international markets yet other than few locations in Canada and in some parts of Europe. For the organisation the Asian food market will be highly suitable as this genre of dine-ins is rare in this region. Chipotle has also increased the food category by delivering new four products like burritos, tacos, burrito bowls and salads (Jain & Haley, 2009). The Mexican offerings are also focused upon so as to enhance the sales.
There is huge competition in the market which acts as major threat for the restaurant. The prices of raw materials and resources that are used often change from time to time and this can also result in economic instability. There have been few food safety issues which have deteriorated the customer perceptions on the quality of food items produced by Chipotle. Few of the major competitors of the company are McDonalds, KFC, etc. These companies have been established long time back as a result of which all these companies have better market presence too and the food items are offered at less prices though consisting of less carbohydrates which can be healthy for the customers (Katz & Green, 2009).
One of the major objectives of Chipotle Mexican Grill is to move from the food safety scandal and begin a fresh marketing push. It is also necessary for the company to make investments and primarily focus on food safety so as to bring the customers back and improve the sales again like before. Chipotle has made extraordinary changes in food safety practices which has created sickness amongcustomersand this not only resulted in decline of sales but also create a negative mindset among the customers. So, the foremost objective of the company is to make necessary investments and again use good quality ingredients so as to manage the food safety issues and improve the quality of food items and increase sales for the company (Levens, 2011).
The market segmentation allows the restaurant to divide the market into a number of segments such as demographics, behaviors of customers and even geographic groups. The marketing strategy is used in order to target the market segments to whom the products and services should be targeted by Chipotle Mexican Grill. Both these Segmentation and Targeting are essential for ensuring success for the company too.Chipotle has a mission statement “foot with integrity” and it clearly shows that the restaurant has picked up popularity among a number of people by not only delivering burritos and nachos but also Mexican food items which have lured many customers too. The restaurant has also maintained its reputationand popularity among the Millennialswho have born between 1982 and even in the early 2000s. The marketing strategy has helped the company Chipotleto deliver fresh and healthy meal and target the customers according to their personality and characteristics (MacDonald et al, 2008). Chipotle do not utilize any traditional form of media to gain reputation from the customers. In order to gain more customers, Chipotle has managed its advertising created an online presence by involving social media and grabbed the attention of many customers.
The non-traditional marketing has been managed by focusing on the message of food sourcing and organic farming. The positioning method has created a proper place of the company Chipotle within the leading chains of restaurants. The young generation is more focused on understanding how the world works and also the food that are being consumed by them and also it has been prepared and delivered to them. Chipotle has considered this by segmenting the market into different segments and made sure that better and effective sustainable operations are carried out by considering the food safety issues too. The positioning of the company has been done by Chipotle with help of uploading the commercial to Youtube platform and gain more customers too (Mangram, 2012). The positioning of the company is done by making the food items available in different locations all over the world and increase the customer base too. This is how the Strategy & Segmentation, Targeting and Positioning have been done by Chipotle Mexican Grill, UK.
The company has practiced various procedures in order to source the best ingredients and prepare best quality food items so as to satisfy the customers. This sustainable practice has been undertaken by the restaurant in order to fulfillrequirements of customers and also considers the significance of food safety (Peterb& Donnelly, 2011). The products and services have been positioned by the company by developing a detailed marketing mix for each of the market segments.
The marketing mix comprises of the elements such as product, place, price and promotion. The company’s products include burritos, few Mexican food items, burgers, etc. The products have been developed with fresh juices, meat and no added colors too. The place where the company has managed to setup are at US, United Kingdom, Canada and few other places over the world. Thus the restaurant needs to expand its business internationally and improve its sales. The prices are also higher for the food menu when compared with the same kinds of offerings by competitors like McDonalds, KFC, etc. The promotional activities of Chipotle are quite effective as it have attracted a large number of market segments and also positioned its products all over the places and has further plans of expanding business too (Singh et al, 2008). The online presence and involving social media has attracted the younger generation and has driven the sales to a large extent for Chipotle.
Chipotle has faced some major issues regarding food safety and the share prices of Chipotle Mexican Grill have risen over the last few days, thus resulting in trading the share prices at $525.60, up by 19 percent from the recent low of $440.90.
Chipotle faced significant food safety issues, when the public health professionals stated that the illness resulting from the E. coli bacterium was caused due to eating at Chipotle restaurants. N between October to the end of the year, share prices of CMG had declined by over 35% (Thackeray et al, 2008).
The same-store sales growth estimates for Chipotle from -17.3% to -23.7% after the 4Q15 results. From recent studies, the closure of the CDC’s investigations, as well as the company’s food safety measures, has increased its investors’ confidence. Also, the marketing and promotional offers appear to have started gaining better results. From all the financial statements, it would be easy for the company to prepare a budget for the upcoming years properly and make sure that the costs are controlled and surplus amount of customers are attracted.
The information exhibited underneath clearly shows the kind of expenditure the organisation Chiptole has to incur (Tuten, 2009). In the recent past the organisation has had to invest significant amount of money on its operation.
In order to control the issues faced and also manage proper control, the company has made few food safety advancements so as to prepare fresh and whole some ingredients that can be prepared by utilizing the classic cooking methods and techniques. This would create tasty and healthy food which would be safe for the customers. The company has used the Microbiological testing for developing effective food safety processes for the ingredient of the recipes made. The testing s done to validate the controlling of injurious microbes present in any kind of raw materials used for the production purpose (Van Zee, 2009).
Souse Vide is a process of cooking food where the items are wrapped in plastic or any other air tight contained and then cooked at dim temperature for a long period of time. This cooking technique has been preferred by chefs and also for the workers.
The organisation Chiptole has worked in collaboration with number of organisations to provide effective health and safety for the farmers which is extremely important. This would fulfill the safety and quality requirements and yield better outcomes with the production of healthy and tasty foods. The International HACCP Alliance provides training and certification in food safety for the managers, apprentices and also the restaurateurs. The HACCP and food safety training are unmatchable within the restaurant industry (Wood, 2013). This would increase the skills of officials and make them perform better so as to enhance the brand name of the company again and achieve competitive advantage within the business environment too.
Conclusion
The topic focused on the marketing plan for the business organisation Chipotle. The situational analysis has helped in determining the strengths, weaknesses, opportunities and threats of the company whereas the Strategy & Segmentation, Targeting and positioning has helped the company to perform better within the business environment and position its products properly in different segments of market. The strategy of the organisation has been effective positioning of its items and services through use of a detailed marketing mix for each of the market segments. The budgetary procedures and financial statements have been represented here in this report (Best, 2009). Lastly, the ways of by which the restaurant Chipotle has controlled its businessoperations and recovered from the situation to achieve profit and competitive advantage in business had been illustrated as well.
References
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