What a LATAM growth expert thinks about Chipotle’s Mexico bet

The news that Chipotle was making moves into Mexico got us talking here at Revenue Brew. The fast-casual brand has spent 30 years growing to over 4,000 nationwide locations and a household name. But as we mentioned in our original article, taking a bet on the country that inspired your success doesn’t always work out (read more about Taco Bell’s Mexico misadventure here).

So how can Chipotle crack the code and satisfy the Mexican palate? We asked Guilherme Nami, partner and member of the global consumer and retail practice at Simon-Kucher, who’s led growth initiatives across Latin America.

Creating authenticity: One word Nami emphasized during his examination of Chipotle was “authentic.” Specifically, the brand’s decision to enter the market with local partner Alsea stood out to him.

“That shows respect for the local heritage and says out loud: ‘We are not trying to show Mexicans what good Mexican food is,’” Nami wrote.

While he praised Chipotle’s “test-and-learn” approach as a good first step, he said Chipotle and Alsea needed to create a clear set of differentiators to fulfill the desires of the Mexican consumer.

“Where do they fit within the constellation of offerings that exist throughout the country?” Nami asked.

Cooking like a local: Nami also acknowledged that adapting to specific territories in the region will be a challenge, citing McDonald’s approach to different geographies.

“Underneath a consistent brand identity, you always need some degree of adaptation to local markets. Just look at the fact that McDonald’s sells fried, bone-in chicken wings in Peru, Panama, and other countries in the region with strong wings [and] chicken cultures,” Nami wrote.

He believes Alsea is aware of this and that the adjustment process will take “2–3 years.”

Putting all the chips on the table: According to Nami, Mexico’s food culture, its relationship with the US, and its large and relatively young population makes the country an attractive market. (In recent years, younger consumers have helped power Chipotle sales.)

“Even if the positioning in Mexico will likely not be of ‘authentic’ Mexican food, imagine the bragging rights Chipotle could claim by having the seal of approval of Mexicans themselves,” Nami wrote.