Companies & Industries

Is Chipotle’s Anti-GMO Campaign Scaring Up Customers?


Is Chipotle’s Anti-GMO Campaign Scaring Up Customers?

Photograph by Craig Warga/Bloomberg

Chipotle Mexican Grill (CMG) has been spending more on avocados, meat, and cheese as it weans itself off genetically modified fare. But in spite of those costs—and possibly because of them—its line of customers just keeps getting longer.

Thanks to a surge in traffic, the fast-casual burrito chain reported that profit in the fourth quarter jumped 30 percent. Sales at restaurants open more than a year were up 9.3 percent, and overall sales surged 21 percent compared with a year earlier. The average Chipotle outlet brought in an extra $622 daily in the last three months of the year vs. the same period in 2012—that’s about 80 more burritos per day.

The company opened almost 200 stores in 2013, but the same-store sales growth is stunning. The most obvious difference in the company’s approach was its vow in March to eliminate genetically engineered ingredients, a pledge it crowed about in some bold (and probably quite expensive) marketing campaigns. Most notably, Chipotle in September released a short animated film called The Scarecrow, which took aim at overly processed fast food. To date, the film has been streamed on YouTube (GOOG) almost 12 million times, including 450,000 clicks on its first day.

On Feb. 17, Chipotle will carry forward its critique of “industrial agriculture” with a four-part comedy series on Hulu dubbed Farmed and Dangerous.

In a conference call on Thursday, founder and Co-Chief Executive Officer Steve Ells noted that raising animals with antibiotics and vegetables with gene therapy are complex endeavors. “That’s why we create marketing designed to make people more curious about these issues,” he said. “We believe the more curious they become and the more they learn, the more likely they’ll come to Chipotle.”

Plenty of people will take issue with that, but Chipotle shareholders won’t be among them.

Kyle-stock-190
Stock is an associate editor for Businessweek.com. Twitter: @kylestock

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Companies Mentioned

  • CMG
    (Chipotle Mexican Grill Inc)
    • $640.04 USD
    • 0.18
    • 0.03%
  • GOOG
    (Google Inc)
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