CHIPOTLE
Janice Lim
BACKGROUND • Chain of fast casual restaurants • Located in US, UK and Canada • Founded in 1993 by Steve Ells • First opened in Denver, Colorado • “Chipotle” – derived by the Mexican Spanish name for smoked dried jalapeno chili pepper. • Chipotle has approximately 1500 stores worldwide now. • Chipotle spend the less on advertising themselves, as they believe that in targeting millennial, using traditional advertising will not bring their message across. 2
SITUATION ANALYSIS: PRODUCT INFORMATION Chipotle’s product is their famous burrito, burrito bowl, tacos and salad. The basic Mexican food.
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SITUATION ANALYSIS: TARGET AUDIENCE
Men and Women between • 18-24 years old • 25 – 34 years old • 35- 44 years old
My main focus in my media plan is the young millennial, especially the age 18 – 24. 4
SITUATION ANALYSIS: COMPETITION
• Main competitors are Panda Express, Taco Bell and Qdoba Mexican Grill • Panda Express and Taco Bell have been in the market for a long time. Their market is a lot bigger just like McDonalds. • As for Qdoba Mexican Grill, although they are not as big as other fast food chain, but their variety choice of food are more than Chipotle. • Chipotle’s Unique Selling Point: Organic, Fresh, High Quality, and Affordable.
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SITUATION ANALYSIS: SWOT ANALYSIS S • Opening new stores with smaller footprint and lower upfront cost. • Achieving their mission and maintaining their reputation for freshness. • Healthy fast food chain restaurant • Strong word of mouth advertising
W • Lack of traditional advertising • Limited Menu – less choices compared to other fast food restaurants
O • Entering new markets. Chipotle is still growing with high consumer demands • Chipotle focuses a lot on healthy eating. They pay attentions to the obesity issue in U.S. Consumers are more keen to choose Chipotle over other “greasy” fast food restaurants. • Quick and excellent customer service
T • Competitions: Panda Express, Taco Bell, Qdoba Mexican Grill, and other fast food chain restaurants. • More and more restaurants are using the healthy eating concept.
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SITUATION ANALYSIS: MARKETING OBJECTIVES
To increase usage and brand awareness among millennial • Millennial that focuses on college students in United States
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MEDIA OBJECTIVES
In the year of 2014, within the $10,000,000 budget: • Increase the awareness in magazines, interactive and outdoor advertising that target men and women ages 18 – 24 years old • Carry out creative message that emphasizes on clean fast food eating 8
“ Not advertising on TV is key to Chipotle’s business model.”
“Millennial view the lack of TV as more authentic… millennial are likely to dismiss a lot of claims.”
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GEOGRAPHY
Chipotle restaurants in the United States •
North east – MRI Index: -117
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South – MRI Index: -128 Midwest – MRI Index: 128
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West – MRI Index: 132
And, United Kingdom, Canada, Germany, and France
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SEASONALITY • Chipotle average daily restaurant sales and net income are lower in the first and fourth quarters. • Fewer people eat out during periods of inclement weather (the winter and fall months) than during periods of mild or warm weather (the spring and summer months).
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MEDIA STRATEGIES • Use Magazines (Print Ads) to target millennial in the first and forth quarter of the year (Winter and Fall seasons). • Use Rich Media all year long to reinforce the brand message • Use Out of Home to increase the brand awareness.
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MEDIA MIX: MAGAZINE US Weekly (Weekly) Total Circulation: 1,964,057 MRI Index: 33 4 color -‐ 1 page (1ti): $ 203,553 6 months = 2ti per month ( January, February, September, October, November & December) $203,553 x 12ti = $ 2,442,636
InStyle (Monthly) Total Circulation: 1,810,539 MRI Index: 46 4 color -‐ 1 page (1ti): $ 180,500 6 months = 1ti per month (January, February, September, October, November & December) $ 180,500 x (6%) = $ 10,830 (Discounted) $180,500 -‐ $ 10,830 x 6ti = $ 1,018,020
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MEDIA MIX: MAGAZINE Marie Claire (Monthly) Total Circulation: 969,965 MRI Index: 52 4 color -‐ 1 page (1ti): $ 148,950 6 months = 1ti per month (January, February, September, October, November & December) $ 148,950 x 6ti = $ 893,700 Rolling Stone (24 times a year) Total Circulation: 1,469,267 MRI Index: 41 4 color – 1 page (1ti): $211,580 6 months= 1ti per month (January, February, September, October, November & December) $ 211,580 x 6ti = $ 1,269,480
Total Magazine Spending: $ 5,623,836.00
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MEDIA MIX: RICH MEDIA Websites (12 months) • IMDb.com (MRI Index: 115) • Groupon.com (MRI Index: 115) • Livingsocial.com (MRI Index: 137) • Ticketmaster.com (MRI Index: 113) $10 x 1,000= $10,000 (per month) $10,000 x 12 months = $ 120,000 (for 1 million impression) 4 Websites= $ 120,000 x 4 = $ 480,000 • Hulu.com (MRI Index: 103) $30 x 1,000 = $ 30,000 (per month) $30,000 x 12 months = $ 360,000 (for 1 million impression) Social Media (12 months) 5 million impression: $50 x 1000 = $50,000 (per month) $50,000 x 12 months = $600,000
Total Interactive Spending: $ 1,440,000.00
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MEDIA MIX: OUT OF HOME Bus Shelters: $ 45,500 (national rate) $ 45,500 x 12 months = $ 546,000 Parking Lot Displays: $ 78,000 (national rate) $ 78,000 x 12 months = $ 936,000 Wrapped Train: $ 39,766 (national rate) $ 39,766 x 12 months = $ 477,192 Taxi Tops: $ 156,000 (national rate) $ 156,000 x 6months = $ 936,000
Total Outdoor Spending: $ 2,895,192.00
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FLOW CHART
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FINANCIAL STATEMENT
Magazines
$ 5,623,836.00
Rich Media
$ 1,440,000.00
Out of Home
$ 2,895,192.00
Total budget spent:
$ 9,959,028.00 18
SUMMARY
Dan Dahlen, a restaurant marketing veteran said, “Chipotle will eventually get to that point, that to drive same-store sales they’ll have to go to TV… As you get into the top spenders in the category, there’s a correlation between share of voice and share of stomoch.” Although Chipotle is doing pretty well by advertising online (socially) and rely on word of mouth strategy, one day, they’ll have to use TV to reach out to broader range of consumers. 19
RESOURCES •
Kantar SRDS
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MRI+
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www.chipotle.com
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http://www.wikinvest.com/stock/Chipotle_Mexican_Grill_(CMG)/ Seasonality
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http://www.businessinsider.com/how-chipotles-business-model-relies-onnever-doing-tv-advertising-2012-3
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THANK YOU 21