Matt Hawkins, Mark Kupferschmidt, Jacob Marek, Rob Schnizlein

1
a

• Matt Hawkins, Mark Kupferschmidt, Jacob Marek,
  Rob Schnizlein
• Marketing 3001 Section 5

2
Outline

• Company Background
• Fast Food Industry
• Competition
• 4 Ps
• SWOT
• Marketing Suggestions

3
Company Background

• CEO Steve Ells
• Founded in 1993
• Private company
• 90 owned by McDonalds, 10 by founder Steve Ells
• Product in Growth Stage
• Over 375 units

4
Fast Food Industry

• 100 billion dollars in sales
• Lead by big three (estimates, 2003)McDonalds
  60 billionBurger King 20 billion Wendys
  16 billion
• Chipotle 321 million
• Sales Growth Rate (2003) Chipotle 40 Fast
  food industry overall 5-15

5
Fast Food Industry Structure

• Chipotle has become the industry standard for
  fast-casual Mexican Dining

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Target Market

• Age 18-24 year old males
• Location Non-rural
• Lifestyle Busy young professionals seeking
  sit-down quality, with speed
• Income Middle-class income (20k-100k/year)

7
Competition

• Baja Fresh
• Wholly owned subsidiary of Wendy's International,
  Inc. as of June 21, 2002, for 275 Million Cash
• Sales 151 Million
• 283 Units
• Slightly Larger Menu

• Taco Bell
• 5.4 billion in sales overall (2003)
• Captures true Mexican fast food market
• More products, cheaper everything.

8
Competition

• Burrito Loco
• Locally Owned and Operated
• Undisclosed Financials
• Similar product, similar price, Distinguishes
  itself by getting chips for free

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Product

• Food with Integrity
• Local farms and free-range co-ops
• Simple, yet flavorful and high-quality meals for
  customers on the go.
• Mass customization in-store

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Price

• Chipotle is constantly expanding by utilizing
  small, local farms and co-ops
• Because of their growth, they have been able to
  take advantage of economies of scale and try to
  pass as much of their savings onto the consumers
  as possible
• Lunch at Chipotle averages around 5-6

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Promotion

• Virtually all of Chipotles promotional marketing
  is done with the use of witty phrases posted on
  buses, billboards, and t-shirts and other
  apparel.
• Word-of-mouth advertising
• The company has also been known to use charitable
  causes for promotions (Example Free burrito with
  charitable contribution)

12
Place

• Location Urban storefronts, shopping center
  end-caps, and freestanding buildings
• Size They prefer a size of 2,400 square feet
  (current sizes range from 1,800 - 2,800 square
  feet depending on trade area characteristics)
  with a minimum of 25 feet of frontage.
• Patio seating is preferred, with adequate parking
  for restaurant use.
• Zoning must be able to accommodate restaurant use
  and allow for a liquor license for beer and
  margaritas.

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Strengths

• Simplicity, attention to detail and high quality
  ingredients
• Brand Equity They ARE the burrito
• Live internet video feed showing food preparation
• Co-op connection
• Creative promotional advertising
• Aprx. 2 billion in annual sales in conjunction
  with McDonalds

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Weaknesses

• Only One low carbohydrate menu choice Overall
  Limited Variety
• High fat content
• Can be difficult communicating with Chipotle
  workers
• Stigma from being owned by McDonalds

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Opportunities

• 31 states without Chipotle restaurants, room to
  expand
• International markets untapped
• More live video/audio feed-production
• Rise of Interest in Sustainable Agriculture

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Threats

• Emergence of competitors due to Growth stage
  Baja Fresh, Del taco, Taco bell, Baja sol,
  Burrito Loco
• Economy still questionable
• Low-carbohydrate craze
• Legal guidelines on constructing in developing
  areas

17
Improving Marketing

• Improving word-of-mouth advertising by adding
  catchy phrases to foil
• Focus less on fantastic marketing and more on
  expansion
• Further Relationship with Charities

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THANK YOU!

• Any Questions?

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Sources

• www.chipotle.com
• www.hoovers.com
• www.mcdonalds.com
• www.bajafresh.com
• www.wendys-invest.com
• www.tacobell.com
• finance.yahoo.com
• www.bizjournal.com
• www.restaurant.org