6 “Smoke and Mirrors”
Chipotle’s efforts to revive its sales accelerated in late June. The company introduced a summer-long rewards program, called Chiptopia, which has already attracted several million sign-ups. It launched a branding campaign centered around a heartwarming animated short film titled A Love Story, which played on more than 10,000 movie screens. And it added a new protein, chorizo, to Chipotle’s menu in select markets. “That stuff works when people say, ‘Oh, something new, I want to try that,’” says Crumpacker, the marketing impresario. “That’s a page we pulled out of the traditional fast-food playbook.”
Around this time, the company reported its second-quarter earnings. Chipotle fell short of Wall Street’s expectations, but there were signs of recovery: They returned to profitability and its quarterly same-store sales, which were down 23.6% year over year, narrowed their decline when compared with Chipotle’s first-quarter results when sales dropped 29.7%.
But just as Chipotle leadership began to feel some sense of momentum, an unexpected crisis embarrassed them: Crumpacker was indicted for cocaine possession leading into Independence Day weekend. He surrendered to police and faces seven counts of drug possession; Chipotle placed him on leave, and he checked into rehab.
