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Chipotle is turning its focus on higher-income customers, and menu prices could soon reflect that.
During an earnings call last week, interim CEO Scott Boatwright said that they’re targeting their primary customers in an effort to increase foot traffic and revenue, and it turns out those customers apparently made over $100K.
“What we’ve learned is the guest skews younger, a little higher income, is typically a digital native, and that their grounded purpose aligns with our North Star as a brand, around clean food, clean ingredients, high protein,” Boatwright said, per Business Insider. “We are the way they want to eat, and we’re going to lean into that in the most meaningful way.”
Chipotle ran a “deep dive” of consumer research, identifying demographics and what their core audience wants from the fast-casual food chain.
“We learned that 60% of our core users are over $100,000 a year in average household income,” he added. “That gives us confidence that we can lean into that group in a more meaningful way, whether it’s the solo occasion and/or group occasions to really drive meaningful transaction performance in the year.”
Chipotle’s core consumer base is reportedly already making $100,000 per year, so the company’s leadership is betting that they aren’t looking for steals on a burrito bowl.
Chief Financial Officer Adam Rymer shared during the call that consumers can expect the menu prices to increase 1-2% so the chain can bridge the gap between pricing and rising expenses.
Chipotle has also leaned into the desire to eat “clean food, clean ingredients, high protein,” recently launching their new high protein menu, which includes small 4oz bowls of chicken or steak, designed as an add-on or a snack for protein-minded individuals — or possibly as a main meal for those on Ozempic without much of an appetite.
Boatwright expressed that before it launched, the company wondered if the new menu would cause consumers to opt for this less expensive option rather than getting what they would normally order, but “frankly, we just didn’t see it.”
They noted that rather than the High Protein Cups becoming a cheaper option, customers are purchasing them alongside their typical order, which showed the company that “the core consumer is not necessarily looking for a smaller, lower price-pointed component to the menu,” Boatwright said.
He also said that Chipotle will continue to test deals and other ideas to re-engage younger and lower-income customers, adding, “I don’t know if it’ll be a meaningful unlock for Chipotle.”
Chief Corporate Affairs Officer of Chipotle Laurie Schalow responded to The Post’s inquiry about Boatwright’s statement to emphasize that “pricing was never mentioned” regarding the $100K and up cohort, and reiterated that “the company sees an opportunity to lean into these customers.”
“Since this consumer population is actively spending more at shops and restaurants today, Chipotle is giving them additional reasons to visit.”
Schalow also noted Chipotle’s “slow and measured” approach to raising prices, claiming its menu has only seen “around [a] 0.7%” increase during this quarter “compared to the industry average of 4%.”
Fans on Reddit had a lot of opinions on the idea of Chipotle targeting high-income consumers.
“Do you think that somebody needs to tell him that targeting only high-income earners probably isn’t going to be a winning strategy for a mass-market fast casual place?” one asked.
“That’s like 10% of the US population, a majority of which are probably eating higher quality food than Chipotle,” someone noted.
Another added, “I just don’t know why someone who could choose anyplace for food would find a particular affinity for Chipotle.”
“I make over 100k a year and I won’t eat at that s–tbox,” a user commented, while another shared, “I make over 100k and literally feel like I’m being scammed going to Chipotle lol.”
“And he can have those customers because I’m not paying for those overpriced, underfilled burritos anymore,” one declared.
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