Learning From The Chipotle Crisis

In the later months of 2015, Chipotle experienced a major crisis when they were accused of serving food that led to e.coli outbreaks in Oregon and Washington State. According to officials as of November 1, 2015, nineteen people in Washington and three people in the Portland area became sick after indulging at the Mexican food chain. While the Washington Department of Health was not able to confidently say that the e.coli outbreak was directly linked to Chipotle restaurants, they were able to speculate that this was the case. Due to this assumed linkage, Chipotle temporarily closed forty-three of its locations according to spokesman Chris Arnold this was done “out of an abundance of caution” (MarketWatch. 2015).

Ever since I first tried Chipotle, I’ve been in love. I remember the e.coli incident and was seriously concerned that one of my favorite restaurants might be closing some doors. Luckily, it seems that this news about Chipotle has breezed over us as consumers and the restaurant is now back on track and it seems that the value of their stock is starting to rise once again. The Chipotle public relations team had to work hard to regain support from their customers. This can be difficult at times, especially amongst an incredibly saturated fast food market where one slip up can cost you millions. When dealing with a crisis like this it is important to follow a plan. The Conflict Management Life Cycle in Think Public Relations is a great place to start when dealing with any sort of public crisis.

The first step in the Life Cycle is to be proactive about your crisis. A practitioner must be vigilantly scanning the environment to be prepared for any kind of crisis before it occurs. They must also look out for a crisis by tracking any potential problems in the media and inside the company by creating strategic plans in precaution. The most important part is to come up with a general plan for any crisis that may occur. It is better to have something established before crisis breaks than scrambling to come up with something when the media is already up in arms.   (Wilcox, Cameron, Reber, & Shin, 2013). Just like everything else, being prepared is always better than not, so why wouldn’t companies be prepared for a crisis situation. Whether you’re waiting for something to happen or you have no suspicion of crisis, it is important to be ready for anything.

The second step is the be strategically identifying conflicts that are just rising to the surface. Part of this is to effectively communicate the risk to anyone who may be involved, it is better that information like this come from the source and not an outside investigator or the media (Wilcox, Cameron, Reber, & Shin, 2013). It is also crucial to place your company strategically in order to anticipate any legal action or bad publicity by having statements ready. Chipotle was ready for this kind of issue, when it occurred the company backed up its “people before brand” mentality by closing the doors of forty-three restaurants even though there was little suspicion of outbreak in the majority of those locations, as well as hiring two food safety consultants to increase their safety precaution (Williams, G. 2015). One thing that Chipotle handled exceptionally well was resisting the “Information Vacuum” and instead was very transparent to their public. They released a statement very early on and was able to speedily react to the problem. (Hogan, M. 2009).

When outbreaks do occur it is important to react appropriately, this includes covering all of your bases through crisis communication including the utilization of the crisis management plan that was developed earlier, as well as meeting the public’s needs. A company should have lawyers ready to support them in any chance of legal procedure, and the PR team should be working to resolve conflicts among the public or internally if necessary (Wilcox, Cameron, Reber, & Shin, 2013). Having these in place will help speed up the process of getting back on your feet. Mike Hogan suggests that the efficiency in which a crisis is dealt with is in direct correlation with the speed of recovery for the brand (Hogan, M. 2009). This is where Chipotle fell short. When the suspected outbreak occurred, Chipotle’s public relations practitioners did not issue any statement on their website and instead pushed their latest Halloween promotion. This did not bode well with Forbes contributor Aaron Kwittenken who said that responding to customers on twitter and facebook alone was not only a failure to uphold their “responsibly raising the bar” brand but also an example a “tone deaf” company (Williams, G. 2015).

Despite this, the Chipotle brand has seemingly recovered. Often after a crisis occurs the most important thing to do is manage the reputation of the brand which may require research and analysis into where the brand sits with its consumers. (Wilcox, Cameron, Reber, & Shin, 2013). One good indicator of this is the price of the company’s stock. In Chipotle’s case, it fell dramatically in November of 2015 and still hasn’t risen even close to its value before the outbreak (MarketWatch. 2015). After assessing the situation, it is crucial to restore the brand’s image by implementing strategies that show that the company is willing to change and win back the customers it may have lost (Wilcox, Cameron, Reber, & Shin, 2013). Chipotle did a good job of this by being increasingly transparent about what it puts in its food even going as far as taking certain items off the menu when they were unable to find a producer that fits their standards for quality (Williams, G. 2015).

Having a plan in mind for a potential crisis is a necessary part of every company’s public relations repertoire. As a practitioner, you must be proactive, strategic, reactive, and finally, you must provide a way for the company to recover. These four steps can help deal with a crisis in an immense way and hopefully the first two will keep your crisis from ever getting to the public eye in the first place. Chipotle did a pretty good job of handing their e.coli crisis, but as always there are ways that we can learn from what they did. It is important to act fast and be honest with your customers. The best way to handle a crisis in an efficient and direct way is to have a plan prepared before one occurs.

References:

MarketWatch.(2015, November 01). Chipotle and the E. coli outbreak: What you need to know Retrieved February 13, 2017, from http://www.marketwatch.com/story/chipotle-and-the-e-coli-outbreak-what-you-need-to-know-2015-11-01

Williams, G. (2015, November 04). Chipotle’s E. Coli Crisis: P.R. Experts Say It’s Handling It Right. Retrieved February 13, 2017, from http://www.forbes.com/sites/geoffwilliams/2015/11/04/can-chipotle-survive-its-e-coli-crisis-pr-experts-seem-to-think-so-and-offer-advice/#1eef2d621644

Hogan, M. (2009). Crisis public relations. In B. Franklin, M. Hogan, Q. Langley, & et. al., Key concepts in public relations. London, UK: Sage UK.

Wilcox, D. L., Cameron, G. T., Reber, B. H., & Shin, J. (2013). Think public relations. Upper Saddle River, NJ: Pearson.

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