- Hollis Johnson
- Queso was responsible for a 2% boost in customers’ average checks at Chipotle, the company reported Tuesday.
- Chipotle’s queso had been slammed by customers as a “crime against cheese” and “dumpster juice.”
- But Chipotle tweaked the recipe after its initial negative reception, and 10% of customers are continuing to add the dip to orders.
While customers have trashed Chipotle’s queso, the chain says that the cheesy dip has become one of its biggest sales drivers.
Queso was responsible for a 2% boost in customers’ average check at Chipotle in the last quarter, the company reported in its earnings call on Tuesday. Slightly more than 10% of customers are ordering the cheesy dip, which Chipotle debuted in September.
Chipotle’s roll-out of the dip – which customers had begged the chain to add to the menu for years – was tumultuous. Customers slammed the the dip as a “crime against cheese,” “expired Velveeta,” and “dumpster juice.”
“Periodic negative press has made it difficult to see the impact of comp drivers like Queso and advertising,” Bernstein analyst Sara H. Senatore wrote in a note to investors on Wednesday.
- Hollis Johnson
In late November, Chipotle adjusted its recipe to address customer critiques, especially those related to the original queso’s grainy, chowder-like texture.
Despite naysayers, Chipotle customers now seem to be regularly adding queso to their burritos and bowls, even after initial marketing for the new menu items heavily-hyped roll-out completed.
A survey by financial services firm Mizuho found that most people who were ordering queso weren’t ordering it for the typical use – as a dip with chips. In fact, only 3% of customers were buying queso and chips.
Chipotle originally teased the queso roll-out as a silver bullet of sorts for the struggling chain – a promise that has not been borne out in reality. While customers adding queso to 10% of orders is certainly a welcome boost, it is nothing compared to the roughly 40% of customers who order guacamole.
Queso’s power to drive comparable sales growth is expected to wane in September, when it laps the roll-out of the menu item. However, the success of queso seems to have helped convince Chipotle to consider rolling out other new menu items, with CEO Steve Ells hinting at tests of items including nachos and grains.
Chipotle reported on Tuesday that comparable sales increased 0.9% in the most recent quarter. The company reported a revenue of $1.11 billion during its fourth quarter, beating Wall Street’s expectations.