Chipotle Sales Still Down: Customers Have Come Back, But Don’t Return As Often

Image courtesy of JeepersMedia

Chipotle Mexican Grill founder and co-CEO Steve Ells told investors, analytsts, and reporters in a conference call late yesterday that the company’s sales recovery “continued at a modest pace” over the last few months. Translation: as polls before this earnings release predicted, customers still aren’t coming back. Comparable store sales are still low, but the company is profitable again, and it has great hopes for its summer rewards program.

The 23.6% figure comes from comparable restaurant sales instead of across the whole chain, since the company still keeps expanding as planned, opening 58 new restaurants during the second quarter of 2016 and 114 during the first half of the year.

“Our entire company is focused on restoring customer trust and re-establishing customer frequency, and rewarding our most loyal customers for visiting more often through Chiptopia is one way to do just that,” co-CEO Ells said in a statement prepared for the earnings announcement. About 30% of transactions so far in July are part of the rewards program, whether they’re customers just picking up their first card or returning to earn more rewards.

“Based on the data we have, we believe that a majority of our most loyal customers have returned, but many of them are not coming as frequently as they used to,” Mark Shambura, head of brand marketing, said in prepared remarks. Shambura is filling in while the company’s chief marketing and development officer, Mark Crumpacker, is on leave following an arrest for cocaine possession.

Later in his remarks, Shambura noted that each visit from a customer, whether they’re a new or returning one, “provides an opportunity for [Chipotle] to restore trust.”

The Chiptopia program rewards customers to visit restaurants four times a month, so the company apparently wants consumerz to return to the habit of eating there at least weekly.

“The best thing that we can do for our business is to earn customers’ trust and loyalty by consistently providing a terrific restaurant experience with safe, delicious food and excellent service,” co-CEO Moran said in his own statement.

Serving a new meat is one way to get bored or cynical customers back in the door and, Ells said that the company plans to expand its new menu item, chorizo, chain-wide by the end of 2016.

Chipotle Mexican Grill, Inc. Announces Second Quarter 2016 Results [Chipotle]

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