In the heat of July, there is nothing better than diving into the crisp ocean or pool to kick back and cool off. But, there are times when these leaps of excitement take a turn for the worse. You know what I’m talking about – when you hit the water flat on your stomach and the sheer sting of contact freezes you faster than the water temperature. You can recover fairly quickly. But, what happens when your brand belly flops? It’s sink or swim.
Here are three communications lessons reinforced by one company, Chipotle Mexican Grill, which is currently treading water:
Be transparent when dropping weight to stay afloat.
Chipotle’s rapid expansion after the 2015 health safety food crisis finally flopped last month when the company’s new CEO Brian Niccol announced big changes for the chain. Chipotle will move its worldwide headquarters in Denver and offices in New York to California. Additionally, the chain will close up to 65 of its under-performing locations nationwide, half of which will shut down this month, to boost profitability. As reported by Fox31 Denver, the restructuring will impact hundreds of employees, some of whom will be relocated and others will be offered retention packages. These changes will cost the company nearly $135 million.
Transparency breeds sustainability. Companies have the power to set the tone for how stakeholders will react when shedding weighted items to stay afloat by how they communicate. Forbes offers five communication tips when downsizing: make sure the information is authentic and free of corporate speak; deliver the news across every internal communications platform; proactively provide information to local media; keep customers in the loop; and, most importantly, demonstrate empathy in all communications.
Engage lifeguards for help.
To bring credibility back to the chain, Niccol is launching a fresh marketing campaign to build “love and loyalty” with its customers, increase visibility and ultimately transform Chipotle into a lifestyle brand. According to a press release, the strategy involves implementing a new customer loyalty program, selling swag, such as t-shirts, and maintaining its social media feeds to give the brand more personality, giving fans additional ways to engage. And, to make a bigger splash in the market Chipotle is meeting consumers where they are by running ads during the season finale of hit TV shows, partnering with the NBA, sponsoring video games and more.
Engagement with consumers builds brand loyalty. Existing Chipotle lovers are the chain’s lifeguards. A study by the Gartner Group shows 20 percent of customers generate 80 percent of revenue. A Bain report adds that repeat customers spend nearly 67 percent more than first-time customers. According to the Loyalty Effect, a mere five percent increase in repeat customers can generate a 25 to 100 percent increase in profits.
Test the water before diving back in.
As part of the rebuilding process, CNBC reports Chipotle will test the option for online delivery through its app with a third party delivery company, Door Dash, at approximately 1,500 locations. According to the Wall Street Journal, the chain is also planning to introduce more snack foods, for which they are testing new versions of quesadillas, nachos and avocado tostadas, a “Happy Hour” promotion between 2 and 5 p.m. with $2 tacos, beer and margaritas, and new late-night offerings with extended hours.
Pilots create change opportunities for better results. Test marketing a new product or service allows companies, like Chipotle, to feel the water through research, customer feedback and performance before diving into a full market expansion. When executing pilots, Chron suggests running ads and promotions in limited locations, testing messaging, coupons, electronic codes and website traffic along the way, to see what customers respond to in order to make tweaks before investing in ideas that may not generate desired outcomes.
Ultimately, if you or your brand belly flops, don’t panic. You have the power to communicate the situation, swim to safety and improve your strokes.
Stay afloat!
