| August 01, 2018
I applaud any company that manages to maintain a strong sense of purpose, and maybe that is why I am fascinated by Chipotle, the fast-casual restaurant. However, when I read that Chipotle’s new chief marketing officer aims to make the brand a “purpose-driven lifestyle brand” it made me wonder what that might really mean.
Chipotle is a fast-casual restaurant chain dedicated to using responsibly raised food in its burritos, burrito bowls, tacos, and salads. Under the stewardship of Steve Ells, the brand’s founder, Chipotle has grown rapidly, from first opening in 1993, to 2,400 restaurants today. As Ells describes in the company’s 2017 Annual Report, his original idea was to create a new fast food experience focused on great tasting food made with high-quality ingredients, but the emphasis shifted to changing the way people think about, and eat, fast food.
The company’s commitment to “Food With Integrity” became a central theme to the Chipotle experience and was articulated in the ‘Back to the Start’ video. Chipotle’s sense of purpose and differentiated dining experience looked set to keep the brand growing as fast as it could open new restaurants, but food safety issues stopped growth in its tracks (something that still periodically rears its head, even as soon as last week). Topline revenue in 2016 dropped 13 percent over the prior year, recovering to 2015 levels in 2017.
The big challenge is that Chipotle’s fundamental purpose increases the risks it faces as a business. The company’s annual report states,
“Our Food With Integrity philosophy subjects us to risks.”
“There are higher costs and other risks associated with purchasing ingredients grown or raised with an emphasis on quality, sustainability and other responsible practices.”
I often suggest that purpose only drives brand growth if a brand is willing to make sacrifices in order to achieve the stated goal. In Chipotle’s case, the brand’s sense of purpose does expose it to more risk and I worry that the new aim of becoming a “purpose-driven lifestyle brand” signals that investors are losing faith that the brand’s sense of purpose is an asset not just a liability. Is talk of lifestyle a way to rebrand the company and downplay its commitment to responsibly-raised food?
Like David B. Srere, quoted in the New York Times article, I worry that the stated aim of trying to make Chipotle a brand that people want to wear smacks of marketing mumbo jumbo. Purpose is not just something you talk about in your marketing; to be effective it needs to be embedded in every aspect of the business. But maybe the comments of the company’s chief marketing officer, Christopher Brandt, actually are a signal that Chipotle is going to double down on its purpose and do a Patagonia; put its money where its mouth is.
But what do you think? Marketing mumbo jumbo or real purpose? What is your bet? Please share your thoughts.