Web Exclusive | December 2013 | By Tamara Omazic

Chipotle’s Next Big Thing

The Mexican fast casual rolled out its catering program nationally, but how will the build-your-own model fare in consumers’ homes and boardrooms?

Chipotle is tapping into new consumer occasions with the recent national rollout of its catering program. The added operation allows the brand to compete in a different space with fast-casual concepts like Panera and Qdoba Mexican Grill that have established catering options.

Chipotle tested catering in select regional markets, including Colorado, earlier this year before implementing the program nationally in November, says Danielle Winslow, a Chipotle spokeswoman.

“We were definitely prepared to take it nationally and always intended to,” she says. “The holidays gave us a perfect occasion to offer the quality food Chipotle is known for.”

Winslow says catering may not have reached a new consumer base for the brand, but Chipotle's existing fans are responding well to being able to enjoy its burritos and tacos at board meetings, holiday parties, and other events. To drum up interest and capitalize on the time of year, Chipotle is offering a holiday promotion to coincide with catering orders, rewarding customers who place an order before December 31 with a gift of two free burritos, bowls, orders of tacos, or salads. Customers just need to present their catering receipt at any U.S. location before January 31.

The catering program includes four different meal options and can serve between six and 200 people, Winslow says. Two options, the Two Meat Spread and the Big Spread, allow consumers to create their own taco, burrito, or bowl, just as they would in the restaurant.

“You have to have catering specialists at every touch point because the transaction dynamic of catering is completely different than that retail transaction, but it’s often the same customer.”

“It's the exact same ingredients we have in our restaurants, with the same quality,” Winslow says, adding that Chipotle is prepared to meet increased demand for its “responsibly raised” meats.

The Two Meat spread feeds 20–200 people, and customers choose two proteins from Chipotle's lineup of chicken, steak, carnitas, or barbacoa. The spread also comes with white and brown cilantro-lime rice, black and pinto beans, four salsas, sour cream, guacamole, cheese, lettuce, crispy taco shells, and soft flour tortillas. The Big Spread offers an additional protein choice and comes with fajita vegetables.

To keep food fresh and to serve it fast, customers receive bowls, utensils, stands, and chafing dishes with fuel to keep them warm. The brand's new braised tofu Sofritas is available as a choice of protein for both spreads in select regions, Winslow says.

“We're also offering our chips and fresh salsas, and guacamole as a catering option of their own,” she says. “It includes all four of our salsas, from mild to hot, and works well for a smaller event or meeting.”

Breaking slightly from its build-your-own model, Chipotle's fourth catering option features an assortment of premade burritos. The Burritos by the Box option allows customers to pick a protein and white or brown rice for the filling, but has three fixed additions: black beans, fresh tomato salsa, and cheese. It serves six or more people, and for every two burritos, Chipotle includes a bag of chips, tomatillo-green chili salsa, guacamole, and sour cream. Unlike the other options, it does not need to be ordered in advance.

“Some data is showing if you go to market with a fixed program, consumers are buying it more. By offering a fixed program, you’re offering more certainty in the product,” says Erle Dardick, CEO of MonkeyMedia Software, a company that helps brands build and grow catering programs.

“What we’ve seen a lot from brands that don’t have catering deep in their DNA or it’s new for them is they try to go to market with their existing menu,” he says. “Because the model of Chipotle is a build-your-own burrito program at retail, they simply extend the manufacturing process into catering, and they try to find another package for it. But, in reality, for the restaurant operator to successfully do catering on a large scale like Chipotle needs to do, they have to adopt a manufacturing mentality.”

For example, Dardick and MonkeyMedia Software were responsible for fine tuning Boloco's catering menu. When the Boston-based burritos and wraps concept first dove into the space, it replicated its retail menu, offering only build-your-own spreads.

“When we started with them, they were doing everything custom, and it was a very difficult environment,” Dardick says. “We worked with them to engineer the menu to a fixed menu, and once we did that, sales raised massively.”

The fact that Chipotle offers options that replicate the in-store experience and a premade assortment could be the key to its success in the catering market. “I think they have a lot of learning to do as a brand. They have an incredible amount of operational adjustments that they’re going to have to make at scale. They’ll be able to do what they’re doing and go to a certain level,” Dardick says.

Aside from the menu, Dardick says, it’s also important for Chipotle, or any brand entering catering for the first time, to invest in employee training specifically for selling catering.

“People development is nine-tenths of the puzzle,” he says. “Inside the company, you have to have catering specialists at every touch point because the transaction dynamic of catering is completely different than that retail transaction, but it’s often the same customer.”

Dardick says training employees to communicate effectively over the phone is often the biggest hurdle—employees need to be prepared to speak with customers who place orders for events ranging from funerals to baby showers. They also need to communicate the catering options effectively, especially if they differ from the in-store experience, as in Boloco’s case.

Winslow says Chipotle implemented various programs to ensure employees across its U.S. locations were well prepared.

“It’s an incredibly exciting time for Chipotle. I think they’re going to do great because they have such a great brand,” Dardick says. “Off-premise restaurant sales are growing, and that’s because consumers want healthy choices, they want convenience. But lunch at the boardroom table is a very different dining dynamic than retail.”