Earlier this year, Chipotle Mexican Grill (NYSE: CMG) reiterated its plan to more than double its retail footprint in the U.S. and Canada, with a special focus on increasing its drive-thru capabilities. During the pandemic, the fast casual chain experienced strong growth in its online sales—which are still elevated in 2022—as well as gradual recovery for its in-store sales after an initial dip in March 2020. Consumer transaction data also shows that Chipotle has the highest month-over-month customer retention rate among its fast casual competitors Moe’s Southwest Grill and Qdoba Mexican Eats.
Sales at Chipotle (NYSE: CMG) for both the online and retail channel exceeded pre-pandemic levels in July 2022
Chipotle’s U.S. sales increased 48 percent between July 2019 and July 2022. Looking at the breakdown of retail and online consumer spending trends during this time frame, most of Chipotle’s growth came from online sales, which increased 194 percent, while retail sales grew 6 percent.
The beginning of the pandemic marked a major shift to online ordering. Between February and April of 2020, Chipotle’s online sales grew 164 percent, while its in-store sales decreased 70 percent. Chipotle’s retail sales have since recovered (and now exceed pre-pandemic levels), and ecommerce sales have largely remained elevated since the initial spike. On a year-over-year basis, Chipotle’s online sales decreased 4 percent in July 2022 while retail sales increased 16 percent. The retail channel also accounted for the higher share of sales in July 2022, with 56 percent of sales taking place in stores.
Over the last few years, Chipotle has ramped up its digital operations. The restaurant chain offers its own app and website for pickup and delivery orders, and it also partners with third-party delivery services (although sales from Uber Eats are excluded from Bloomberg Second Measure data). In 2019, Chipotle also introduced the Chipotlane drive-thru for picking up digital orders. Drive-thrus, including drive-thru only locations, have reportedly accounted for significant growth during the pandemic.
Interestingly, Chipotle’s in-store customer counts are still lower than before the pandemic. In July 2022, in-store customer counts were 18 percent lower than the same month in 2019, while online customer counts were 117 percent higher. However, online customers tend to spend more than retail customers. In July 2022, the average monthly sales per customer was $48 for the online channel and $32 for the retail channel.
Chipotle has a higher customer retention rate than competitors Moe’s Southwest Grill and Qdoba Mexican Eats
Chipotle is one of several fast casual restaurants specializing in burritos, tacos, and bowls. Some of its main competitors are Moe’s Southwest Grill and Qdoba Mexican Eats. Among these three companies, Chipotle has the highest month-over-month customer retention rate. In July 2022, Chipotle’s month-over-month retention rate was 43 percent. By contrast, 31 percent of Qdoba’s customers and 28 percent of Moe’s customers from June 2022 made a repeat purchase in July 2022.
To encourage customer loyalty, many fast casual chains like Chipotle, Moe’s, and Qdoba have introduced rewards programs. These companies have also been eyeing major expansions—with Chipotle looking to double its locations in North America and Qdoba entering new metros as part of its plan to expand to 2,000 units. Qdoba was also recently acquired by a private equity firm and is expected to be merged with Modern Restaurant Concepts. Meanwhile, Focus Brands, the parent company of Moe’s, has been growing its “non-traditional” units, such as kiosks or storefronts located in convenience stores, colleges, and big-box retailers.
Even with these expansion plans, most sales at all three companies come from returning customers rather than new customers. At both Qdoba and Moe’s, 13 percent of sales at each company originated from new customers in July 2022. At Chipotle, only 5 percent of sales came from new customers during the same month.
Bloomberg Second Measure launched a new and exclusive transaction dataset in July 2022. Our data continues to be broadly representative of U.S. consumers. As a result of this panel change, however, we recommend using only the latest post in assessing metrics, and do not support referring to historical blog posts to infer period-over-period comparisons.