It seems Chipotle is ramping up its marketing efforts — and closing down some shops — as part of its attempted revamp under new Chief Executive Officer Brian Niccol. The chain announced the closures, noting they would be focused on “underperforming” locations.
Niccol’s hiring has been a boon to Chipotle’s long-suffering share price: its stock is up 80 percent since he took over in February.
That strength, according to reports, is pushed on the back on planned digital expansions such as “in-app” delivery from 2,000 of its restaurants. The brand has also announced plans to finally launch a loyalty program by the end of 2018. Questions about specific menu item adds, like quesadillas and nachos, were mostly brushed off, though Chipotle executives did note in a call that their intention is to be focused on “aggressive growth” in the United States.
Stock prices fell after the call, however, as investors were looking for more specifics on improvements and the timeline until they are out in the wild.
“There are some key areas they really did not address, notably international strategy,” Maxim Group Analyst Stephen Anderson said.
“Also capital allocation, particularly in regard to share buybacks and potential discussion for a dividend. I still think it will happen but it is probably going to be about a year or two away,” Anderson said.
Among other new offerings considered are a $2 tacos with drinks as part of a happy hour promotion.
Those changes likely come in response to complaints that despite its use of fresh ingredients, Chipotle offerings have gone “stale” and need some refreshing.
Niccol — a veteran of Yum Brands’ Taco Bell and the mind behind the Doritos Locos Tacos and $1 Nacho Fries — is said to be looking to bring a bit more interesting flair to the Chipotle menu. (Though we wouldn’t hold our breath on any Dorito-flavored tacos.)