Qdoba has hired Marc USA's Cogniscient Media as its new media agency of record, handling all digital and offline media. It previously worked with Horizon Media for its media.
The new media agency appointment comes after an ownership change for the Mexican-style restaurant chain, which has grown over the years but remains a distant second in a category dominated by Chipotle Mexican Grill. After restaurant chain operator Jack in the Box Inc. spent months considering what to do with Qdoba, it sold the chain in March to funds affiliated with Apollo Global Management for about $305 million. Qdoba's same-store sales fell 1.4 percent in fiscal 2017, which ended in early October, reversing an increase of 1.4 percent in fiscal 2016.
Jack and the Box Inc. had acquired the chain from a private investment group for $45 million in 2003, back when Qdoba had only 85 locations and annual system-wide sales of about $65 million. Qdoba now has more than 740 locations in the U.S. and Canada and 2017 systemwide sales just over $820 million.
While Chipotle has struggled over the past few years, for its part, it remains the leader by far, with more than 2,400 locations and annual sales exceeding $4.4 billion.
"Apollo is very much behind wanting to grow the business," says Dave Buklarewicz, executive VP and executive media director at Cogniscient. He said the agency has been tasked with linking media investment, particularly in digital, to real business results—whether investments are actually improving transactions, putting people in stores and most importantly, he says, having people return.
He added that in the "extremely competitive" fast casual category, Qdoba needs to get out a message of freshness and quality.
"When looking for a media agency, we knew we wanted a partner that was digitally forward-thinking but could still effectively drive engagement across all channels," Jill Adams, VP of marketing at Qdoba, said in a statement. She said the agency showed expertise in data and the ability to gain deeper insights into its target audience.
Cogniscient will work with Mistress, the Santa Monica, Calif.-based creative agency Qdoba hired last year. When Chipotle introduced queso on its menu, posing a threat to a dish associated with Qdoba, Mistress launched a "trollvertising" campaign— "#TheirWordsNotOurs"—that took negative Twitter reactions to Chipotle's queso sauce and animated them as five- to 10-second GIFs.
Integrated, full-service agency Marc USA recently branded its media practice as Cogniscient so the agency could pitch more media-only business, believing there was a gap in the market for an agency for mid-tier marketers that want the attention of a seasoned team but aren't necessarily spending hundreds of millions of dollars, Buklarewicz says.
Cogniscient—which it says also works for Payless ShoeSource, Navistar and the Pennsylvania Lottery—will handle the Qdoba business out of its Boston office. Qdoba's new media strategy will roll out in October.
Los Angeles-based Select Resources International led the media review.