Chipotle Finally Losing Some PR Flavor Due to Criminal Probe

By Shawn Paul Wood Comment

chipotle norovirus

Few brands have been able to withstand the ire of consumer watchdog media and get acquitted in the court of public opinion like Chipotle.

In fact, we had a similar discussion a couple of months back about the brand’s (then) small E. Coli outbreak and how it managed to salvage its amazing PR mojo. While that was a factual statement, this is 2016 and even seemingly impenetrable brands are showing their cracks.

This was clearly seen as Chipotle has been hit with a federal grand jury subpoena and criminal probe over what has now been revealed as a norovirus outbreak in California this past fall, which caused more than 230 people to get extremely ill.

The subpoena requires Chipotle to produce a broad range of documents related to a restaurant in Simi Valley, California that experienced an isolated norovirus incident during August 2015, the company said in a Securities and Exchange Commission filing.

The company said it will cooperate with the investigation and that it can’t yet determine if there will be costs associated with the probe.

From E. coli spreading to 140 at Boston College to the virus reaching 12 states in numerous locations, people have been getting sick over those finely rolled burritos for months.

That forced the other USDA — U.S. District Attorney’s office — with the Food & Drug Administration (FDA) to look beyond the ‘food with integrity’ tagline.

Here’s another reason why:

Chipotle said sales plunged 30 percent in December. The company expects sales to fall 14.6 percent at established locations for the full fourth quarter, marking the first decline since the company went public in 2006.

In non-shareholders’ terms, this means stock circled the drain by one-third in 12 months. Don’t cry for the non-GMO governors just yet. One share will still run you more than $426 in Burrito Bucks, so there’s that.

Some of that surplus and organic raw sharp cheddar is probably going to more legal fees and less slick copywriting these days. However, don’t fret. They’ll be back, PR folks… and you will all be there.

 

[FEATURED PHOTO: AP Photo/Steven Senne]
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