Chipotle Mexican Grill is the fast food restaurant chain which is founded by Steve Ells who is the current chairman and co-chief executive officer of Chipotle. Chipotle was started operating in 1993 and now, the company has expanded 1024 in all over Canada and United States. The aim of Chipotle is to provide best fast food experience and high quality dining experience to the customers with the fresh ingredients. The goals of Chipotle have been achieved by the widespread success with the wide range of fast food products. The company has commitment of “Food with Ingredients” which ensures the combination of socially, humanely and environmentally responsible products.
Chipotle is the brand name which has designated of the best position in the segment of fast-casual restaurant. The company has differentiated itself by the claim of the unique quality of food products with the sustainable building designs, community building, and Chipotle experience. Chipotle experience is provided by unique line system of Chipotle for ordering and offering the meal to the customers. In terms of unique building, Chipotle follows green principle of design. So, Chipotle provides unique food experience by innovative fast food setting (Jennings, 2013).
The market situation for the Chipotle can be analyzed by the SWOT analysis of the company. It is important for every company to evaluate the current market before setting any kind of objective for the future. SWOT analysis will be helpful in getting current market position for the company. Based on the SWOT analysis of Chipotle, it is observed that there many strengths of the company by which it can grasp the opportunities available in the market (Roger, 2013).
Strengths-
The greatest strength of Chipotle is the level of consistency in the all aspects of operations. The mission, vision and values, value propositions, choice of competitive strategy, business practices, and marketing messages of the company are the base of the success of the company. Along with this, Chipotle has developed well-known brand based on the standard of quality and integrity. Further, the company has adopted marketing tactics beyond traditional marketing. The company has found innovative ways by creating marketing campaign.
Further, employees are the strengths of Chipotle as the ‘popular culture’ creates frontline employees to think and behave like business owners. Along with this, Chipotle has small and consistent menu which reduces the cost of R&D for new products, promotion of new product and training of employees. These all are the strengths of Chipotle which are the main cause of the success of the company in the food industry (Chakravarthy & Coughlan, 2011).
Weakness-
There is one main weakness of supply chain management of the company. Due to the high standards of quality and integrity of the food products, the number of suppliers for Chipotle has been reduced as compared to other companies in the industry. So, Chipotle has faced the supply shortage for business operations. This is the fact that the built brand on the quality by the Chipotle is the main problem now. Price premiums, their brand, and large component of value proposition are the key success factors of the company but they are not in control due to lack of suppliers.
Opportunities-
Expansion of the Chipotle in various countries can be an opportunity for the company. Continued expansion in international market provides existing opportunity for the company. Along with this, opening more restaurants of Chipotle and decision to offering the breakfast menu can be another potential opportunity for Chipotle. In the international market, there can be opportunity to increase the sales for the Chipotle.
Threats-
By the SWOT analysis, it is observed that there are some threats also for Chipotle which can affect the business objective in the market. There is the increased competition in the food industry which can be major threat for the Chipotle. The Chipotle has adopted price premium based strategy to differentiate the products from the competitors. But due to increased competition, Chipotle have to increase the prices of the food products which can impact the company in achieving the business goals. Further, the increased cost of food items can also be the threat for Chipotle. Due to commodity prices and the limited supply chain of Chipotle, company can be hurt in terms of profitability and expansion plan. Along with this, labor cost is also increasing in the market. Due to change in minimum wages and employees benefits labor cost has increased and this can impact on the profitability of Chipotle (Armstrong & Cunningham, 2012) (Appendix 1).
Overall objective of Chipotle is to raise the brand awareness of high quality and honorable food standard during the product sales. The objective of marketing plan is to increase the brand awareness to the primary target market and secondary audiences. In present time, Chipotle has around 1,104,139 likes on Facebook having positive comments of the customers. On the other hand, on the Twitter page of the company, there are 11,421 followers. The member of the company tweets daily on the Twitter page to communicate with the customers. Now, the company wants to increase the way of conversation between the customers and the brand in the market. By twitter, the company will conduct events and increase the frequency of the customers for the brand (Martínez, 2012).
The main aim of the Chipotle is to increase awareness of high quality food among the customers. Along with this, company has the objective to increase the brand awareness of the company to primary target and the secondary audience. The goal of the Chipotle team is to increase the sales high quality products in the end of 2017. The company has set the expectation for this manner. Overall, Chipotle wants to distinguish itself within the fast food industry having value proposition.
Strategy and segmentation-
In the segmentation part, Chipotle adopts much segmentation to attract the customers in the food industry. It is important for the company to divide the overall consumer market into various parts to identify the requirements and demands of the consumers. Reason is that the customers have different tastes and preferences based in their surroundings and lifestyles. First off all, Chipotle targets the customers based on demographic segmentation. Chipotle targets the customers having the advertisement “food with integrity”. Under this, Chipotle targets young people having the age of 18 to 34 years with at least bachelor degree having middle class lifestyle. Further, Chipotle uses psychographic segmentation to target various social classes. Social class can be defined by the amount of money which the household possesses and the prestige held by the occupation (Bruning, Hu & Hao, 2009). This social class of people is known for their uniqueness. As mentioned above, Chipotle is famous for ordering the food and providing the order exactly how the customers want it. Thus, Chipotle psychographic segmentation to target the customers based on their social class, tastes and preferences and the living styles (Gilligan & Hird, 2012).
Targeting market-
The target markets of Chipotle are young professionals, young active families and college students. They can be both male as well as female having the age of 18 to 34. It is clear that Chipotle has slightly higher prices of the products so the target customers for the company are in the idle class to wealthy income level. The lifestyle of such types of customers is busy and they do not have any problem to spend of special meals such as Chipotle on occasions. Chipotle is focused on identifying the values of target market. Having high quality in the food products, Chipotle targets those customers who value healthy eating. So, those types of customers would buy the food in wide range of groups of friends or a small family group (Lovelock, 2011).
Positioning-
The Chipotle has maintained good position in the food industry due to its quality standards in the food products. Chipotle is basically focused on the food sourcing and organic farming of the products. Chipotle is the slogan “Food with Integrity” which shows the commitment of the company for the customers. Slogan of the company provides the assurance to the customers in terms of fresh, simple and pure ingredients which will be used in the food products. Chipotle is famous for finding and using very best ingredients with respect for animals, environment and the farmers.
In the marketing tactics and actions, Chipotle will adopt marketing mix strategies to attract the customers. Marketing communication strategy and action plan will be adopted to create brand awareness among the customers. In the product strategy, Chipotle will offer wide range of fast food products according to the taste and preferences of the customers. In the price strategy, Chipotle charges premium price. Chipotle is the good food restaurant and it is expected that it will increase the prices due to expansion (Porter, 2016). In the distribution strategy, Chipotle will use selective suppliers. Chipotle has highly selective marketing system involving limited suppliers. But more channels will be created in future. In the promotional strategy, Chipotle will adopt new promotional mix to create new ways of awareness among the customers. Chipotle will display logo and ads where majority of the customers can see it (Turnbull & Valla, 2013).
In the communication strategy, Chipotle is already adopting social media channels for communicating with the customers. Further, Chipotle will find new strategies to communicate with customers. There is the need of effective messages to increase brand awareness of brand in the market. For this, Chipotle will focus on two-way communication methods. Chipotle will create promotional mix department to create communication plan for long term strategies. After that, Chipotle will launch new wave of awareness by planned marketing strategy (Peñaloza, Toulouse & Visconti, 2013).
Before implementing any marketing strategy in the business, it is important for the Chipotle to plan budget to estimate the cost incurred in the marketing plan. The budget allocation for this marketing plan will be done in various factors. Chipotle will use different social media channels such as Facebook, YouTube and Twitter for this. For social media, budget will be $75,000 dollar. After that, Chipotle will launch home advertisements in the major metropolitan cities. For this, budget will be allocated $3,526,800 dollar for six months. Broadcasting is also best method for marketing. Chipotle will advertise the products by media channels i.e. broadcast commercial. For this, cost will be allocated $10 million dollar. At last, Chipotle will conduct some events and for this $89,750 dollar will be used (Appendix 2).
Tight controls will be used to measure and monitor the effectiveness of proposed marketing plan in the market. By the two-way communication methods, company will be able to reach to the customers. Chipotle will continue with the pricing strategies to maintain the prices of the restaurants and high quality ingredients to serve in the fast food products. Further, marketing team will also measure the progress and the monthly sales. Forecasting will also be done towards culture, trends on the brand personality of the company. Forecasting will be helpful to be prepared the company for future. For this, new marketing strategists will be hired to develop growth and short and long term goals of the Chipotle in the global market (Fifield, 2012).
Conclusion
Increasing brand awareness and maintaining customer relationship is most important for the survival of any company. Chipotle is the famous fast food chain in the food industry. The aim of this marketing plan is to create the awareness regarding high quality food among the customers. For this, the company will use two-way communication plan to communicate with the customers. Effective marketing and communication strategies will be develop to target the customers in the food industry. Innovative marketing strategies and communication strategies will also be helpful in increasing the sales of high quality food products.
To achieve the marketing objectives i.e. creating awareness about healthy food products provided by Chipotle among the customers, print media strategy is very effective. The poster has made for this strategy. Now, it is not enough only to develop the promotional strategies for the objectives, but also it is important to impellent those strategies to attain the customers. For this manner, Chipotle will adopt promotional mix in the communication campaign. The theories of promotional mix are very important to analyze the communication channels (Pavlou & Stewart, 2015). Chipotle basically uses traditional marketing strategies to target the customers. The aim of the company is to advertize solidly to the fresh products rather than creating the promotions to draw people into the stores. For this, print media will be very effective communication tool for the company as the customers will stop and read the message provided by the Chipotle (Taleghani et al, 2011).
Chipotle basically provides services to wide range of customers. The communication campaign will target customers of every segment. The specific target market for the company will be both men and women having the age of 24 to 35 who are college going or who work in rural and urban areas. Company will target those customers who just entered in the career path and who are already established in this. These types of customers have fast-paced life. In young professionals always seek for the healthy food and Chipotle provides healthy alterative of nutritious food rather than fast food.
AIDA model is the best known marketing model for the organizations. This model basically identifies the main stages in which the customers goes through during the purchasing process of a product or service. It is a kind of purchasing funnel in which buyers go in various stages to make final purchasing. AIDA stands for five stages i.e. Awareness, Interest, Desire and Action. In case of Chipotle, target customers of the company will react according to this model after seeing the poster (Hanlon, 2013).
Figure 1: AIDA Model
(Source: Hanlon, 2013)
Awareness: The customers of Chipotle will be aware about the brand by seeing the poster. This is the print media strategy which will be effective for long-term duration. The communication campaign is about creating the awareness about the healthy food products and to increase the sales of Chipotle’s products. The message of this campaign is ‘Unlock Your Potential with Healthy Food’.
Interest: Chipotle will be able to gain the interest of customers by providing the information of healthy food. The strategy is to make the customers aware about the health issues due to unhealthy foods.
Desire: The health awareness will be helpful to make the Chipotle’s products among the customers. Poster will be the effective communication tool as customers will read and think about the importance of nutritious food in daily life.
Actions: After distributing the posters, company will provide some discounts and offers on the offered products. With the poster, other tools such as email, website, and inbound phone calls will also be used to attract the customers (O’Guinn, Allen & Semenik, 2011).
References
Armstrong, G., & Cunningham, M. H., (2012), Principles of marketing, Australia: Pearson publication
Bruning, E. R., Hu, M. Y., & Hao, W., (2009), Cross-national segmentation: European Journal of Marketing, 43 (11/12), 1498-1522
Chakravarthy, B., & Coughlan, S., (2011), Emerging market strategy: innovating both products and delivery systems, 40(1), 27-32
Fifield, P., (2012), Marketing strategy, (2nd edition), Berlin: Reed educational & publishing Pvt Ltd
Gilligan, C., & Hird, M. (2012), International Marketing Strategy and Management, 17
Hanlon, A., (2013), The AIDA Model, Accessed on 6th April 2017 from https://www.smartinsights.com/traffic-building-strategy/offer-and-message-development/aida-model/
Jennings, L. (2013), Chipotle Mexican Grill, Nation’s Restaurant News, Accessed on 6th April 2017 from https://search.proquest.com/docview/1427280870?accountid=14549nhttps://hl5yy6xn2p.search.serialssolutions.com/?genre=article&sid=ProQ:&atitle=Chipotle+Mexican+Grill&title=Nation’s+Restaurant+News&issn=00280518&date=2013-05-01&volume=47&issue=9&spage=44&aut
Lovelock, C., ( 2011), Services Marketing, (7th edition), India: Pearson Education
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O’Guinn, T., Allen, C., & Semenik, R., (2011), Advertising and Integrated Brand Promotion, Ohio: Cengage Learning
Pavlou, P. A., & Stewart, D. W., (2015), Interactive Advertising: A New Conceptual Framework Towards Integrating Elements of the Marketing Mix, pp. 218-222
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