With growth stalling, Chipotle Mexican Grill Inc. (CMG) is mulling changes that threaten to turn the burrito chain into what founder Steve Ells said it would never be: another fast-food joint.
Ells, a classically trained chef, built a cult brand by wowing diners with a tightly edited menu of sustainably sourced food and helped pioneer the “fast casual” category.
Hewing to that vision is getting harder. Last week, the Denver-based company reported profit that trailed analysts’ estimates amid slowing same-store sales growth. After the results, Ells suggested strategic changes one might expect from his counterparts at McDonald’s Corp. (MCD) or Burger King Worldwide Inc. (BKW) They include running more commercials that drive traffic rather than celebrate the brand, and possibly adding breakfast items and installing drive-through windows.
The proposed changes recall what happened when Starbucks Corp. (SBUX) began brewing bagged coffee instead of grinding beans in front of customers in stores, losing the fresh coffee aroma, said Kevin Lane Keller, a marketing professor at the Tuck School of Business at Dartmouth College in Hanover, New Hampshire. Starbucks later returned to grinding.