There are several big brands out there that have interesting stories when it comes to its relationship with advertising, and with AdLand in particular. For example, during a Small Agency Conference, Chobani was exhalted for sticking with small agencies. Then, once it got a new CMO, the "relationship" changed. Chobani went a new direction that didn't include the partner agency.
Then, you have brands like P&G. P&G, the largest advertiser in the world, tried to start a precedent by changing the way it paid its advertising partners. Other brands joined in, while many others were looking on to see if it will work. This is a battle that continues today. Thankfully it has been out of the headlines, which could mean that AdLand is making progress against such a one-sided and unfair philosophy.
Now we get to Chipotle. Chipotle has quite the reputation amongst the agency world. If we had to write about Chipotle like a kid who was joining a new school, we would note that "Chipotle doesn't quite play well with others."
Yes, there was a time when Chipotle was just running through agencies. We wondered why. Interestingly enough, we got a chance to meet one of the marketing minds who were there during that advertising turmoil. They said that they were repeatedly promised certain things from the agencies, but the two sides could never form the understanding the brand was looking for. Yes, that the agencies "couldn't 'get' the Chipotle brand."
Well, Chipotle is advertising again, and because of its added presence, the sales are going through the roof. In the third quarter alone this year, Chipotle's revenue rose 15 percent. Total revenue is up, same store sales are up, and the brand, investors, and market watchers are all saying that it is because of the advertising.
Chipotle is growing at a rate faster than its peers, and has the highest price-to-earnings ratio for restaurants.
Now you are probably waiting to read about who Chipotle is working with to get all this work done. Well, the Bloomberg source doesn't say. But if you heard of the Scarecrow video ad, that was animated by Moonbot studios.
In any case, we are happy to see that Chipotle is back into the advertising mix. And it is paying off for them. If they are working with a new agency, let's see how the story continues to unfold.
Dwayne W. Waite Jr. is partner and principal at JDW: The Charlotte Agency, a marketing and advertising shop in Charlotte, NC. He enjoys consumer behavior, economics, and football.
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