Chipotle has experienced E. coli and norovirus outbreaks in 2015-2016 that sickened hundreds and caused a drop in sales and stock prices. The company must rebuild trust with customers and investors by emphasizing its food safety efforts through social media, transparency with the media, and highlighting its commitment to food integrity. Measuring the effectiveness of these communications strategies through surveys, social media analytics, and sales benchmarks will help Chipotle assess its progress in restoring its brand.

1. JULIAN GROSS

2. CHIPOTLE 1
EXECUTIVE SUMMARY
Chipotle Mexican Grill has recently experienced some of its worst media
coverage ever about outbreaks of E. coli and norovirus, sickening hundreds of people
across the country. Customers have questioned the safety of Chipotle’s fresh foods,
with fears of another outbreak or health crisis. Sales have dropped and investors are
angry, feeling the company misled them in ensuring that their food was safe.
The Mexican food chain must construct an organized communications plan
company-wide to rebuild trust among customers and investors, to realign with the
company’s mission statement of “food with integrity.” With the right communications
tactics, targeting customers and investors, Chipotle can once again be the fast food
company customers can rely on to produce food with integrity.
BACKGROUND
Chipotle Mexican Grill, commonly known as Chipotle, is a Mexican fast food
chain operating in over 2,000 restaurants across five countries. The company
specializes in fast food Mexican cuisine, particularly mission style burritos, tacos, burrito
bowls, guacamole and margaritas (Chipotle Annual Report, 2015). Chipotle opened its
first store in 1993 with the goal of being “food served fast that didn’t have to be the fast-
food experience.” Chipotle’s brand centers around fresh ingredients, unique cooking,
and an “exceptional experience” (Chipotle, 2016).

3. SITUATION ANALYSIS AND OUTCOME
Recently, Chipotle’s brand has been called into question as a result of the E. coli
and norovirus outbreaks that sickened nearly 500 people across 12 states (FDA.gov,
2016). The outbreaks have driven away customers, sales, and investors, and damaged
the company’s reputation. Chipotle’s health crisis has been one of the most publicized
food safety stories of the past few years - leading customers to question the safety of
major brands and sourcing from small producers (Healthy Dining Trends, 2016).
Chipotle’s business sales were down as low as 37 percent in some stores because of
the outbreak, and investor sales were down 30 percent (Neate, 2016).
Chipotle was accused of being misleading to customers and investors, causing
many to lose trust in the brand. Chipotle's mission statement “Food with Integrity” is now
called into question, and the company is facing lawsuits from investors over accusations
of false statements by CEO Steve Ells about Chipotle’s food safety during the outbreak
(Neate, 2016). In December, Steve Ells began speaking to the media on the “TODAY
Show” and “Mad Money” to discuss what was happening with the E. coli and Norovirus
situation (CNBC, 2015; TODAY, 2015). Chipotle is expected to report its first-ever
quarterly loss since going public, during Q1 2016 (Krantz, 2016).
According to a survey by William Blair analyst Sharon Zackifa, consumer
sentiment towards Chipotle was at its
lowest in January, when stock prices also
hit a 52-week low (Sozzi, 2016).
February 1, 2016, the CDC announced the
end of Chipotle E. Coli outbreak. The CDC

4. CHIPOTLE 3
concluded, “The epidemiologic evidence collected during this investigation suggested
that a common meal item or ingredient served at Chipotle Mexican Grill restaurants was
a likely source of both outbreaks. The investigation did not identify a specific food or
ingredient linked to illness” (CDC, 2016). In efforts to regain public trust, Chipotle closed
its doors for four hours on February 8, 2016, to hold a virtual meeting. In the meeting,
CEO Steve Ells provided transparency for employees and media alike on the current
state of the health outbreak, and new food safety policies going forward.
Ells then announced a “$10 million program to assist local food suppliers in
complying with its new safety guidelines” (Mohan, 2016). This bold initiative had a
positive impact, showing how Chipotle is taking proactive steps to ensure that its food is
safe and to improve its current practices. Although the closure came at a large cost, it
was well received by customers, showing the company will put its customers’ safety
ahead of profit. This also gave Chipotle more positive media coverage, which it
desperately needed following 2015 (Barnett, 2016).
Chipotle stores affected by E. coli reopened during the week of April 11, 2016,
and the company still needs to regain the trust of its customers and investors to avoid
further losses. The outbreak has been one of the most widely covered food crises in
history because of the continual series of missteps, leading to greater public awareness
of the outbreak and mistrust among the public (Erbentraut, 2016). Where a lack of food
safety emphasis was seen throughout the crisis, a focus on food safety and trust in the
brand will help bring Chipotle back from its damaging year.

5. GOAL
Rebuild customer and investor trust of Chipotle following the recent outbreaks of
E. Coli and norovirus.
OBJECTIVES
 Generate positive media coverage of Chipotle in the next three months
 Increase publicity of food safety efforts and facts on the website and social media
 Create positive brand association with Chipotle
TARGET AUDIENCES
CUSTOMERS
Chipotle’s customers, according to its CEO, “are millennials who would skip fast
food in favor of restaurants like Chipotle.” Millennials, ages 23 to 36, make up about 20
percent of the U.S. population. Millennials prefer quality over price, which is why they
are more likely to eat at a Chipotle rather than a traditional fast food restaurant (Jones,
2014). While restaurant customers may tend to choose competitors originally after such
an outbreak, they typically come back after a short period of time (Gandel, 2016).
Chipotle customers have “more disposable income and are more health-
conscious than the average fast-food customer,” according to branding expert Rob
Frankel (Fottrell, 2016). Millennials are easy to reach by social media but prefer a
meaningful interaction on social media or a recommendation from a peer rather than
traditional advertising (Mintel, 2015).

6. CHIPOTLE 5
INVESTORS
Chipotle (CMG) is traded publicly on the New York Stock Exchange (NYSE).
Chipotle first went public in 2006 and the value has grown to over 3,000 times the
original value during the IPO (Investopedia). To date, Chipotle’s 52-week high in stock
price was $758.61 and the low was $399.14 in
January 2016 after the health crises (Chipotle,
2016). The company’s shares fell 29 percent in
2015, making it one of the worst performing
restaurant stocks that year, and investors
continue to worry about the company’s future
(Gandel, 2016). Chipotle will soon raise its prices, due to rising food costs, but it is not
expected that this will drive away customers and is appealing to investors (Fottrell,
2016).
INTERVENING PUBLIC: THE MEDIA
The media has had a large impact on the
outcome of Chipotle’s health crisis – a large drop
in sales and stock prices. Chipotle has accused
the media of helping “fan the crisis” before all the
facts were available (Wahba, 2015). Keeping a
good relationship with the media to reach
customers and investors is key to maintaining a positive image. During Chipotle’s four-
hour shutdown, Steve Ells invited a few reporters to sit in on team meetings to see
firsthand what the company would do going forward to remedy the E. Coli situation
(Mohan, 2016).

7. RECOMMENDED COMMUNICATIONS STRATEGIES AND TACTICS
Chipotle needs a strong communications strategy to reach its customers and
investors to ultimately raise its bottom line. Chipotle must reverse the narrative of
mistrust and unsafe food that has been in media over the past year, and more
effectively communicate the steps it is taking to ensure safe, fresh food to its customers.
While Chipotle has made several mistakes in the handling of the E. coli outbreak, it is
without a doubt that the company will be able to bounce back in due time. Some
recommended strategies and steps for strengthening Chipotle’s communication with its
customers, investors, and the media are as follows.
SOCIAL MEDIA
In the social media realm, Chipotle is in a class of its own. A 2011 Nation's
Restaurant News study found that Chipotle responds to 83% of Facebook posts and
90% of Twitter customers through @-mentions (Klamm, 2012). The company’s social
media strategy focuses on highly engaging, personalized responses. According to
Chipotle’s New Media Manager, Joe Stupp, “likes and retweets are great, but what
matters most to Chipotle is genuine conversations with customers” (Klamm, 2012).
When word got loose of Chipotle’s E. coli outbreak, social media responses were much
different, often passive at best.
In the early stages of September 2015,
Chipotle responses on social media were
defensive, asking followers to consult a doctor or
reassuring frantic followers that it is safe to eat at
a Chipotle. The company withheld information for

8. CHIPOTLE 7
several months before letting the public know the severity of the issue, which was a
major misstep in the company’ social media strategy (Bradley, 2015).
 Explain what measures have been taken to remedy the situation.
 Post updates as they occur – develop a fun infographic with a report card design
and show updates and accomplishments.
 Posting positive press stories on the website and social media such as retweeting
and sharing stories of share increases, new policies, etc.
 Monitoring social media more frequently to dispel negative comments about the E.
coli situation to address trolls and negative comments with positive comments and
include positive news links where applicable.
 Continue to respond to followers, but with positive responses rather than defensive
CORPORATE SOCIAL RESPONSIBILITY (CSR)
Millennials are likely to choose a brand that they feel engage in a meaningful and
targeted way (Mintel, 2016). By highlighting all of the efforts Chipotle has taken and
appropriately targeting customers, it will help rebuild trust among millennials, who more
highly value CSR over the older generations (Mintel, 2015).
 Create a “Meet the Chipotle Team” video to show every step of the production
process from farm to burrito, including all the safety measures taken.
 Condense the above information into an infographic which can be shared on social
media and Chipotle’s website.
 Develop a new “Food with Integrity” video. The video begins with a sincere apology
from CEO, Steve Ells and shows the progress Chipotle has made since September
2015 and future steps the company will take.
 Highlight current CSR efforts, such as the $10 million food-safety investment.

9. TRADITIONAL MEDIA
Chipotle’s media coverage of the past year has been overwhelmingly negative.
Chipotle’s health crisis was one of the largest publicized food safety crises in history –
not only causing a negative image of the brand, but also causing a larger amount of
people to be skeptical of the brand. Positive, transparent media coverage will reach
customers and investors alike and help rebuild the damage caused by the crisis.
 Offer more interviews with high-level officials.
 Include media in the conversation with Chipotle officials to show transparency and
gain more news coverage.
 During the Chipotle meetings in February only two reporters were present
(Mohan, 2015).
 Include some sort of science professional when giving interviews on talk shows or
other multi-person platforms.
 In the “TODAY Show” and “Mad Money” interviews, Steve Ells and his VP
were present. An epidemiologist should have been present as well to offer
expert testimony and add to the credibility of the CEO and VP.
LEADERSHIP TRAINING
Because of the need to have more high-level Chipotle officials in the media, a
key component to make this strategy effective will be leadership training.
 The CEO and other C-level officials need to step up and speak about the cause of
the E. Coli outbreak and the successes following.
 Position the CEO and public health professionals upfront to speak to TV and print
media about what happened to cause the outbreaks.
 Show that the high-level officials are taking personal hits because of the crisis.

10. CHIPOTLE 9
 CEO still making $14M after pay cut, but suspended all bonuses for
executives after outbreak.
INVESTOR RELATIONS
Chipotle will soon have to report its first-ever quarterly losses to investors. In
order to ease investors’ worry, the financial officers must reassure that Chipotle’s stocks
are on the rise and customers are returning.
 Issue a press release with realistic expectations and a positive quote from Steve
Ells – relaying the bad news but reassuring the steps the company is taking to
improve upon this in upcoming quarters
 Cover bases with internal communications by letting employees know where
footage of the call is located and allowing them to participate if they choose.
 Annual report – compare how reporting is before and after the crisis and see
what the numbers look like.
 Offer in-person meetings to provide facts and reassurance for concerned
investors.
APPLICATION
 Remodel Chipotle application
 Add new features such as a CSR and news section
 Promotions, such as a rewards feature where customers can earn a free
burrito/bowl after nine purchases.
 Offer pop-up notification options for when promotions are occurring or
there is positive news to be reported.

11. MEASUREMENT AND POST-PLAN RECOMMENDATIONS
In order to ensure a successful campaign, the steps taken to improve
communication with customers and investors must be measured for their effectiveness.
The measurements will be reported to company officials and investors, and the
communications to know the effectiveness of their work. The campaign will be
measured in the following ways:
SOCIAL MEDIA MONITORING
Social media is a large part of the campaign, and all social media tools offer
analytics measuring engagement, followers, location, reach, and the usefulness of the
outlet. Social media can be monitored daily, weekly, monthly, and yearly. The social
media strategy will be adjusted according to what is working and what is not.
MEDIA ANALYSIS
A comprehensive analysis of the positive and negative media coverage of
Chipotle will be measured daily. The analysis will track Chipotle mentions and the
outlets the company is covered in. Data will be pulled bi-weekly to see what outlets
need to be targeted and where coverage needs to improve.
SURVEYS
A pre-campaign and post-campaign survey taken by customers will measure
Chipotle’s brand image and perception. The survey will be posted via social media,
email, and on the Chipotle app. Customers that complete the survey will receive a
coupon for a free beverage or side item.
BENCHMARKS
One of the key ways to measure Chipotle before, during and after the crises will
be benchmarking sales and customer perception of the brand. Each of the above tools

12. CHIPOTLE 11
will be used to measure how Chipotle compares to its previous months and years to
make projections for the future.
SWOT ANALYSIS
STRENGTHS
 Personalized social media
engagement with customers
 Customer loyalty
 Large social media following
 Partnership with local farmers to
use fresh foods
 Commitment to health brand by
getting rid of GMOs and carnitas
when they countered mission
statement
WEAKNESSES
 Current reputation following health
crises
 Lack of ownership for current crisis
 Crisis directly counters the brand’s
mission statement
 Negative media coverage
 Recent falling sales and stock
prices
 Waited too long to address health
crises
OPPORTUNITIES
 Highlight food safety efforts on
social media
 Increase CSR efforts
 Offer more direct interviews with
high-level officials to show
transparency
 Improve media coverage overall
THREATS
 No guarantee that another food
safety outbreak will not happen
since the CDC was unable to
pinpoint exactly where the
outbreak originated
 Customers have turned to
competitors as a result of the crisis
 Lawsuits from investors
 The company doesn’t know where
the food contamination began
 Falling stock prices

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chipotle-faces-first-ever-loss/82796194/

14. CHIPOTLE 13
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