Chipotle has experienced a grueling sequence of food safety issues, its latest concern occurring in Boston last week. That particular outbreak of norovirus shaved $750 million off the company’s market cap in just two days’ time.
The company has now announced that they are planning to distribute 21 million coupons for free burritos. The company’s CFO Jack Hartung said, “Free burritos—turns out it works. It brings people into the restaurants.” The expense of this effort is estimated to be about $70 million – almost 16% of Chipotle’s total sales last year.
I feel for the leadership team at Chipotle. They have endured crisis after crisis. Worst of all, they are still unsure about the source of the original multi-state E. coli outbreak. The company instituted a comprehensive food safety program enterprise-wide, with some of the highest standards for food safety in the market, including: high-resolution DNA-based ingredient testing, changes to food prep and food handling practices, enhanced internal training, and paid sick leave.
One thing is for certain, market cap and revenues aside, the company’s relationship with their customers is down. Way down. Chipotle said its sales fell 26% in February, following a 36% percent drop in January.
Here is the takeaway: if you are a service organization, your company’s brand is the central, defining promise you make to your customers. And that is the sum of every transaction, impression, and experience they have with your business. So in a very practical sense, the strength of your brand is directly connected to how consistently you keep those promises—day in and day out—across all of your locations or properties.
Your ability to get the majority of the details right—and do so consistently at all of your locations—translates directly into better customer experiences and a stronger brand. But consistency requires much more than simply training your people and trusting that their best efforts will be good enough. You need a standardized, enterprise-wide system for monitoring all the details that truly matter to your business – like food safety – so you are able to quickly identify problem areas, hold people accountable, and then clearly measure improvement.
RizePoint is the global leader in software solutions that proactively safeguard enterprise compliance—for both internally-imposed standards and externally-imposed regulations. Our customers gather better data, see necessary actions earlier, and act faster to correct issues before they become costly liabilities. In other words, we help food service companies identify and resolve these kinds of health and safety issues before they become significant problems.
Free burritos is a good short-term first step for Chipotle to repair its broken customer relationships. Longer term, the company must build powerful brand consistency capabilities into its core auditing and assessment processes. Improving the quality of the customer experience – food safety playing the most vital role – is what will build strong and lasting customer relationships. With RizePoint food safety software, those lasting customer relationships will come naturally.
About the Author
Michelle Suzuki
Vice President of Marketing
As Vice President of Marketing, Michelle Suzuki is responsible for the strategy and execution of all aspects of RizePoint’s marketing efforts. A 20-year veteran of technology marketing, Suzuki joined RizePoint from LANDESK Software, where she was Director of Global Marketing. Prior to that role, she led worldwide marketing initiatives in positions with EMC, Novell, Overland Storage, and Ancestry.com. Suzuki holds a Bachelor of Arts degree in Communications from Brigham Young University.