Chipotle prides itself on being a different kind of fast-food company, and that even applies to how it briefs its ad agencies.
For example, the company does not feed real-time, quarterly sales figures to its creative shops, which include CAA Marketing and GSD&M. Why? Well, that's what the other food chains do, explained Mark Crumpacker, Chipotle's chief marketing and development officer, today at the 4A's Transformation conference in Austin, Texas. Also, when you focus on short-term gains you lose sight of the big picture of what you're trying to accomplish, namely building a distinctive brand.
"We don't look at short-term quarterly sales. We don't manage our business quarter to quarter. We manage it for the long run," Crumpacker said during a discussion of Chipotle's marketing approach that was led by Forbes editor Jennifer Rooney.
Chiptole CMO, Mark Crumpacker |
Crumpacker added that Chipotle spends just 1.6 percent of its sales revenue on marketing, compared to the fast-food category's average of about 6 percent. Of course, Chipotle is a fraction of the size of McDonald's and can't outspend the market leaders. Chipotle's food costs are higher (35 percent of sales) than the industry average (27 percent). So, the company needs those dollars that are not spent on marketing to cover the cost of its ingredients.
"So, we've already made our commitment. We've already made our bed, and that is to say that our ingredients are better, and that's the story," Crumpacker said. "What I get to do is basically tell that story. Why is it better? So, we're investing in the long run."
Crumpacker added dryly that if "there came the day where [my bosses] came to me and said, 'Hey, I need like 10 percent sales [gain] next quarter,' they'd just have to fire me."