Marketing Analysis : Qdoba Mexican Eats

Chipotle has a very simple product line-up offering tacos, burritos and salads. However, it offers up to 65000 combinations of ingredients for customers to choose while assembling the product. The product ingredients, sourcing and preparation are important for Chipotle w.r.t. customer experience and perceptions about the brand. There is however, no difference in product line-up when compared to direct competitors like Qdoba.

First off, Qdoba provides many more options on its menu than Chipotle. For example, kids have four options on

Qdoba has many competitive factors that come into play. Being a ‘fast casual’ (meaning sit down food at a fast pace) restaurant is a huge competitive advantage among other Mexican restaurants. Another thing that puts Qdoba ahead of other restaurants is that it offers a wide variety of sauces and salsa’s made at different heats. Another competitive factor associated with Qdoba and other Mexican food chains is buying real-estate. Every Mexican food chain wants to be in that ‘prime spot’; a place with not much competition and a lot of people. For example right now, the owner of the Bemidji Qdoba is looking to open another store in Duluth, MN. Not only is land expensive up there, but there is not another Mexican restaurant around the area which makes it possibly a very profitable place to start a store. Qdoba isn’t the only Mexican restaurant to notice this though; right now they are competing with Chipotle to get the best possible location in Duluth where they can maximize their profits.

Chick-Fil-A is a brand I am loyal to. Our relationship is great because it feels 50-50. Not only does the brand accommodate me and my busy schedule through apps, and even having employees stand outside and take my order when the drive-thru line is too long. According to a study by IBT 82% of millennial parents share my plight and would do almost anything to avoid long lines at fast-food restaurants when they have their children with them (Marcin, 2016). 48% would skip a meal all together in order to avoid the lines (Marcin 2016).

Chipotle Mexican Grill has a unique approach to their operations. The way the restaurant is laid out is an important part of the restaurant’s operational system and is also what sets them apart from other fast food restaurants. When the customer comes in they are faced with their basic options, tacos, burritos, burrito bowls, and salads. Once the customer makes a selection they have the ability to customize their order with the various fix-ins, which are laid out in front of them. The customer’s ordering process moves along similar to that of a cafeteria-style setting where the customer moves down the line to the end of assembly and is greeted by a cashier. The kitchen is an open layout that is open for view by the entire restaurant. This is part of the Chipotle’s design plan. Having the kitchen open allows the diner’s to view the cooking

Chipotle’s kitchen and restaurant design intentionally places employees up front to reinforce a focus on service, through interaction with customers and individual attention by creating one burrito at a time (Chipotle, 2011, p. 5). While Chipotle combines basic ingredients to magnify the flavor they also stick to the basics when staffing their restaurants. Chipotle only has two shifts and cross trains their

Chipotle is a part of a large industry of restaurants. Of these restaurants, Chipotle best fits in the fast casual Mexican segment. In this market, Chipotles main competitors are Taco Bell, Del Taco, Qdoba Mexican Grill, and Moe’s Southwest Grill. Several of their competitors compete by offering menu items that are explicitly branded as lower in carbohydrates, fat, and calories. Some may claim that their products are improved for customers, or they would target their market at particularly dietary preferences. Quite a few may put emphasis on lesser-cost or even value meal options +(http://ir.chipotle.com/mobile.view?c=194775&v=202&d=3&id=aHR0cDovL2FwaS50ZW5rd2l6YXJkLmNvbS9maWxpbmcueG1sP2lwYWdlPTEwMDM5ODM1JkRTRVE9MSZTRVE9MTcmU1FERVNDPVNFQ1RJT05fUEFHRSZleHA9JnN1YnNpZD01Nw%3D%3D).

Chipotle Mexican Grill, Inc. (Chipotle) is a US based company of Mexican food restaurants that developed and operates in the fast casual, fresh Mexican food restaurant industry across the US. Chipotle is the catalyst for this new category of restaurant. Chipotle believes that the idea that food served fast doesn’t have to be typical fast food. The company manages Mexican food restaurants across the US, Canada and London, all under the flagship brand and trademark of Chipotle. Chipotle also focuses on using the best ingredients, and living their mission statement “Food with Integrity”. Their focused menu of burritos, burrito bowls, tacos, and salads; are made to order right in front of you, of high-quality, organic ingredients which are

Secondary components of its Value chain are assembly line process and the uses of billboard, and radio ads to market. The operating strategy of Chipotle is based on the principle that “the front line is key.” The open kitchen design allowed customers to be a part of line process, which improve customer interaction with its employees. To improve its brand recognition and increase customer awareness, Chipotle utilizes mix marketing approaches to employ

Due to economic downturn the strength of the buyers’ power has increased as the industry looks to gain consumers with pricing strategies much like those of McDonald’s “Value Menu” and combination meals even though the cost of commodities have gone up (James, 2010). Customers of QSRs are looking for quality food without high costs. While Chipotle does not have a value menu or offer any type of combination meal much of their success is due to the fact that the customers are willing to pay a higher cost for higher-quality (Chipotle, 2010).

Chipotle is the leader in the fast casual market, with over 1,900 locations, $3.21 billion in annual revenue, and the ability to serve up to 300 customers an hour. It has innovated the restaurant market by providing reasonably priced scratch-made meals, containing local ingredients, all within the confines of a pleasing aesthetic environment (Chipotle Mexican Grill, Inc., 2014; Kaplan, 2011). To reach its success, the firm utilized architectural innovation by stealing components of various types of restaurants already in existence. The company appropriated its rapid meal preparation methods from fast food chains such Subway and Quiznos, adopted its provision of quality food from more upscale casual Mexican restaurants, and implemented a locally based supply chain similar to that seen at many local farm-to-table establishments. This convergence of different properties came together right as the millennial generation was coming of age and demand higher quality, natural, and locally sourced ingredients in meals that could receive quickly. The company has also attempted to utilize an incremental innovation approach by removing all CMO ingredients and testing new foods such as breakfast items, soup, and chorizo sausage (The Associated Press, 2015; Peterson,

Taco Bells objective and goals are simply to create a profitable market that will add value to their customers. By planning and implementing a breakfast opportunity will give the Taco bell and competitive advantage in the industry that they are competing.

Table 2 shows that the addition of new items to the menu is an opportunity for Chipotle to attract more customers. With the weakness of limited menu options combined with the opportunity, Chipotle can increase sales by introducing new product categories. While Chipotle Mexican Grill is focusing on Mexican-based fast food, Chipotle opened a new restaurant in 2011 called ShopHouse Southeast Asian Kitchen, serving Asian-inspired cuisine. With this newly brand concept under Chipotle, this related diversification strategy could be the key to the company’s growth in the future. Due to the food safety incidents, Chipotle is running the risk of losing loyal customers under the threats of E.coli outbreak. Chipotle plans to bring back Chorizo to the menu, a blend of spicy pork sausage and chicken, to draw back its most loyal customers. Moreover, the company has developed a catering program tapping into new consumer occasions. This newly catering option not

Mission – By delivering uniquely flavored Mexican style food at budget prices, Taco Bell seeks to establish an international presence over the next 5 years. The current international fast food markets in Asia, South America, and Africa are dominated by American style fast food which leaves considerable opportunity for competing styles of cuisine, Taco Bell will use an aggressive marketing plan and develop a supply chain network that will enable rapid growth in overseas markets. Newly established restaurants will be able to supply local communities with quality meals at competitive prices while simultaneously creating value for shareholders.

Ferrero is the Italian leading manufacturer of chocolate and other confectionery products. Founded in Alba, Piedmont, in 1946 by Pietro Ferrero, the once simple corner pastry shop, thanks to the hard work of two generations of Italian entrepreneurs embodied in Michele (son) and Giovanni Ferrero (grandson and CEO), grew and evolved in what Ferrero is today, a multinational family-owned group image of the Italian excellence in the chocolate world.