Chipotle Starts Loyalty Push in Bid to Entice Wary Diners

Chiptopia Summer Rewards Push Comes as Chain Needs Ways to Lure Customers After Outbreaks

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Chipotle store exterior
Chipotle store exterior Credit: Courtesy Chipotle

Chipotle Mexican Grill Inc., still feeling the fallout from a series of foodborne-illness outbreaks, will introduce a new loyalty program aimed at getting customers back in the door.

The promotion, called Chiptopia Summer Rewards, will begin on July 1 and last for three months, the Denver-based company said in a statement Monday. The program provides free food to customers if they make multiple visits to Chipotle within a given month.

The company has been trying to rehabilitate its brand since an E. coli outbreak and multiple norovirus cases were linked to the chain. Chipotle has used previous marketing and coupon offers to lure diners back to its restaurants, with limited success so far. Same-store sales plummeted 30% in the first quarter of this year, and Chipotle posted a loss for the first time as a public company.

When Chipotle posted its weak first quarter results in April, it said it might use a summertime limited-time frequency incentive program as one way to lure diners.

The loyalty program may lead to something more permanent, Mark Crumpacker, chief creative and development officer at Chipotle, said in the statement Monday.

"While Chiptopia Summer Rewards lasts just three months, we will be carefully listening to our customers and using what we learn as we consider the design of an ongoing rewards program," he said.

The offer requires patrons to make at least four $6 purchases in a single month, with a maximum of one purchase per day counting toward the tally, to get a free entree.

Chipotle spent $55 million on promotions and marketing in the first quarter, or about 6.6% of its $834.5 million in revenue -- a much higher percentage than it typically spends. The company plans to report its second-quarter results on July 21.

- Bloomberg News with contributions from Advertising Age

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