Following widespread foodborne illness outbreaks that sickened hundreds of people and made headlines worldwide, it goes without saying that Chipotle — previously considered the king of fast-casual — has a long road ahead of it. The company seems to have a clear plan to mend its damaged reputation, including tougher guidelines for food suppliers and new food-handling processes that involve less on-site prep and more food testing; and in an attempt to drive traffic back to stores, a stepped-up advertising campaign and free food giveaways.
But will Chipotle be able to overcome multiple lawsuits, plummeting stock prices, a criminal investigation, and seemingly endless amounts of bad publicity to reclaim its place at the top of the fast-casual sector?
Given that the company built its reputation on serving higher-quality food — constantly striving to set itself apart from the fast-food pack by touting fresh ingredients, serving humanely raised pork, and decrying GMOs — "it may not be too surprising that its fall from grace has been swift and severe," as the New York Times points out. While fast food chains like Jack in the Box and Taco Bell have suffered their own foodborne illness outbreaks (and made full recoveries), Chipotle's long-running slogan of "food with integrity" may be the very thing that will make its own recovery tougher.
"A big part of the reason why people would flock to Chipotle two, sometimes three times a week was because people could trust it," says Crystal Spence, senior consultant at Vivaldi Partners Group, a global brand strategy firm that works with major brands. "Chipotle customers are not only freaked out, many of them have lost faith ... A Chipotle turnaround is going to require something a lot more compelling and strategic than free food, because that's not what the Chipotle target was looking for. Chipotle has to restore trust, which, once lost is one of the hardest things for a brand to do."
Erik Deutsch, principal of Los Angeles-based ExcelPR Group, also thinks the company ought to focus on reassuring customers their food is safe rather than giving out gratis burritos. "No doubt Chipotle can recover, but offering free food isn’t the key to turning things around," he says. "Customers understand that the cost of a burrito is insignificant compared to the cost of getting E. coli."
But reassuring customers they won't get ill from eating at Chipotle could be tough, considering the company has still been unable to pinpoint the ingredient that caused hundreds of people to be sickened — and for an unlucky few, even hospitalized — with E. coli-related illnesses. Nonetheless, Eden Gillott Bowe of Gillott Communications thinks as long as Chipotle can avoid further foodborne illness problems, things should soon be on the upswing for the company — free food or no free food: "Right now people are afraid, and fear is a powerful motivator. If there aren't further outbreaks and missteps, this should soon fade," she says.
The way she sees it, people currently fall into one of three categories in regards to Chipotle: "People who are loyal customers haven't been affected," she says. "The people who didn't like Chipotle to begin with probably won't be won over by grand gestures, aka free stuff. Once the CDC gives Chipotle a clean bill of health, the people who are on the fence will slowly start to come back."
And that's something the company is banking on: In December, sales at established locations plunged by 30 percent, and executives have warned 2016 will be "messy" as the chain attempts to right its ship. But Glenn Selig, a leading expert in crisis PR, thinks the future looks bright for Chipotle: "Given the fact that there have been no more reports of illness since November, the CDC appears ready to give the all-clear, and the extraordinary steps the company has taken — including an accepting of responsibility — the public will likely be ready to return," he says. "Lots of people love Chipotle and in their heart want to return, and that will certainly work in the company's favor."