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January 11, 2021

Chipotle serves up fresh, personalized marketing with Dynamics 365 Customer Insights

Chipotle Mexican Grill lets its customers personalize food to their individual tastes, and the company wants to personalize its marketing efforts to target individual patrons’ interests and activities. The company traditionally had lots of data but no comprehensive customer data platform to make sense of it all. By deploying Microsoft Dynamics 365 Customer Insights, Chipotle can now organize, analyze, and enrich its customer information to target marketing efforts so they’re as meaningful and effective as possible.

Chipotle Mexican Grill

Better food for a better world

Chipotle Mexican Grill, Inc. is cultivating a better world by serving responsibly sourced, classically cooked, real food with wholesome ingredients without artificial colors, flavors, or preservatives. Since its founding in 1993, Chipotle has grown to a chain of more than 2,700 restaurants in the United States, with additional locations in Canada, France, Germany, and the United Kingdom.

Chipotle has multiple sources of customer data, including a loyalty program with more than 17 million members, point-of-sale data, a customer care center, and digital platforms. But in the past, the company didn’t have a comprehensive customer data platform or any other good way to use its customer data to drive business insights or improve marketing efforts.

“Fundamentally, you can’t improve on something that you can’t measure,” says Sashi Kommineni, Director of Enterprise Analytics at Chipotle Mexican Grill. “To track key performance indicators such as repeat visitors or customer sentiment, we need to be able to gather and analyze longitudinal data in a more effective way.”

Those measurements are also important for marketing campaigns and marketing analytics. “If you’re able to gauge customer lifetime value and find out who your best customers are—and locate other customers like them—it opens up tremendous possibilities for targeting them with more meaningful messaging,” says Kommineni.

A hunger for better customer insights

Chipotle launched its loyalty program in March 2019, at which time the company started gathering more information than it ever had about customers, along with the ability to track those customers over time. Recognizing how impactful all this data could be drove home the importance of having a customer data platform that could help the company best use this bounty of new information.

“We wanted to better understand customer preferences and how they change over time,” says Kommineni. “We have high-, medium-, and low-frequency customers, and we wanted to know about things like how they contribute to comparable store sales year over year. Are increases driven by the same people just buying more, or are new customers coming in? Those are incredibly important things for a business of our size to understand.”

So, Chipotle began looking for a customer data platform solution that would help capture these types of insights. The company did thorough research into the available products on the market and opened a request for proposals with the six companies that seemed best able to help Chipotle navigate its customer data journey. Following this evaluation process, Chipotle chose Microsoft Dynamics 365 Customer Insights.

“We weren’t just looking to buy a canned, off-the-shelf product and call it a day,” says Kommineni. “We wanted a product we could customize for our specific needs, and one that would interoperate well with our other existing systems. We also wanted a vendor that really understood our business and was willing to develop an ongoing relationship with us. Microsoft is that company.”

The decision to go with Customer Insights wasn’t made by just one group within Chipotle—it was an effort across the company, including the technology, marketing, and business teams. All of these groups felt that Customer Insights was a superior choice, not just for its own features, but for its interoperability with other tools in Chipotle’s technology stack and the ability to work with Microsoft Azure services like Azure Data Factory pipelines. Chipotle also brought in a member of the Microsoft Partner Network as part of the project team working with Customer Insights.

“We can extend Customer Insights with marketing technology connectors, out-of-the-box AI and machine learning models, and reporting,” says Kommineni. “Customer Insights is a best-in-class product for a company seeking speed to market in its customer initiatives.”

“Customer Insights is a best-in-class product for a company seeking speed to market in its customer initiatives.”

Sashi Kommineni, Director of Enterprise Analytics, Chipotle Mexican Grill

A healthy serving of customer data

Chipotle has millions of customers a year across its thousands of locations, and with Customer Insights, the company can gain a deep understanding of individual customer preferences. Are they lunch or dinner customers? Are they weekend or weekday customers? What are their favorite meals? Do they prefer vegetarian options?

Using the map, match, and merge logic at the heart of Customer Insights, Chipotle can standardize and reconcile conflicting data and then set up business rules and act on them appropriately. This leads to unified profiles which provide the granular view that facilitates highly specific messages.

Chipotle also uses Customer Insights to grow its customer base by converting more guests into loyalty program members. Using enrichment with Microsoft Graph and third-party enrichment, Chipotle can capture and better understand guests who purchase from Chipotle but aren’t members of the loyalty program. With the power of enrichment in Customer Insights, Chipotle can market to those guests and bring them into the loyalty program, where they become “known” customers with whom Chipotle can build relationships.

The third-party enrichment was particularly significant, adding up to 30 percent more customers. Through the enrichment process, Chipotle narrowed down hundreds of millions of source customer records using 50 match rules to produce accurate unified customer profiles. The company was able to link more than a billion activities to these customers with Customer Insights.

Now that it has a unified view of each customer, Chipotle created an extensive number of measures that drive key performance indicators (KPIs) that help the company boost revenue and increase personalization for customers. These KPIs include customers’ primary base entrées, primary proteins, primary order channels, rewards anniversaries, and average online order values. With this data, the company can create robust segmentation for marketing efforts.

Chipotle also wants to extend the platform and use it with other data sources. “The ease of doing partner enrichment is an important capability of Customer Insights,” says Kommineni. “Microsoft takes a vendor-neutral approach, which is key because it allows us to easily connect across our existing platforms and quickly activate insights on multiple destinations, such as customer relationship management apps, social media advertising platforms, and data connectivity services.”

Rolling out timely offerings

The global pandemic has significantly impacted Chipotle, and it has made the work on Customer Insights even more valuable to the company. “This is a very important time to understand our customers,” says Kommineni. “Many people are hesitant to go to restaurants, so we want to understand customers’ concerns and market to them in a highly targeted way that aligns with their values and is appropriate to the COVID-19 environment. For example, that could mean educating them about our digital business and our delivery and pickup options. Through highly specific targeting, we can increase conversions and the use of those new services.”

With Customer Insights, it becomes easier for marketing groups at Chipotle to reach their desired audiences. “In the past, our digital media team needed to contact an external agency that was holding some of our data in order to create a specific customer audience for a campaign,” explains Kommineni. “With Customer Insights, we now have access to an interface with all the custom attributes we need, and with the click of a button, we can create audiences based on the desired criteria and then onboard that audience to our activation partners.”

Through increased insight into customer behaviors, Chipotle can directly target customers with messages that appeal to them. For example, if a person is mostly a weekday customer and has been opting for delivery, Chipotle is likely to get good results with a message about free delivery on Mondays. If a customer isn’t a loyalty member, a message targeting the loyalty program can bring them into the company’s digital ecosystem.

Chipotle takes pride in the fact that, more so than other brands, its customers can customize meals to match their dietary preferences. With Customer Insights, the company can do that same sort of customization for marketing. “Every customer is different,” says Kommineni. “Customer Insights allows us to understand each customer’s differences and market to them as a unique individual. The opportunities for personalization are just fantastic.”

Find out more about Chipotle Mexican Grill on Twitter, Facebook, and LinkedIn.

“We also wanted a vendor that really understood our business and was willing to develop an ongoing relationship with us. Microsoft is that company.”

Sashi Kommineni, Director of Enterprise Analytics, Chipotle Mexican Grill

Beginning September 1, 2023, Dynamics 365 Marketing and Dynamics 365 Customer Insights will merge into a single offering under Dynamics 365 Customer Insights. Learn more about the evolution of Dynamics 365 Customer Insights.

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