Chipotle Mexican Grill
Called the "Low Roller Menu," Chipotle's new offerings include soup, salad, and tacos. A single taco sells for $2.25, more than you'll pay at Yum! Brands'
So far, Chipotle is only testing its "Low Roller" offerings here in its home city of Denver. The messaging is striking, and similar to what you'll find in former parent McDonald's
Other proposed changes include a kid's menu and featured items. Think of the latter as a customer-friendly way to standardize offerings a la McDonald's, Burger King
The lower price points and a clearer menu should allow Chipotle to boost traffic, something the burrito baron failed to do during an otherwise strong first quarter. Here, "strong" refers to same-store sales growth. Chipotle's comps improved 2.2%, thanks in part to price increases on certain items. Mixing in "Low Roller" options should add diversity without distorting its reputation as a premium quick-serve brand.
We've seen this strategy work with high-end retailers and consumer goods manufacturers. Apple
And it may be exactly the spicy topping this burrito baron needs.
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Apple is a Stock Advisor selection, while Nokia is an Inside Value pick. Our Motley Fool Hidden Gems service has recommended Chipotle's "B" shares, while our Rule Breakers analysts like the burrito baron's "A" shares. Order up any of our Foolish newsletter services free for 30 days.
Fool contributor Tim Beyers had stock and options positions in Apple and stock positions in Nokia and Chipotle's B shares at the time of publication. Check out Tim's portfolio holdings and Foolish writings, or connect with him on Twitter as @milehighfool. The Motley Fool is also on Twitter as @TheMotleyFool. The Fool's disclosure policy feels weird for craving guacamole this early in the morning.