How Chipotle is using crypto and gaming as gateways to loyalty
Avocados may be among the few things that expire faster than a crypto price, but Chipotle is still giving people a way to “buy dip.”
Chipotle said this week it is giving away $200,000 in cryptocurrency through a new online game called Buy The Dip — a nod to the crypto market’s ongoing downturn. Playable through July 31, the game gives players a chance to win crypto like Bitcoin, Ethereum, Solana, Avalanche, and Dogecoin along with other prizes that are actual drops like guacamole and queso. (The game follows a similar stunt last year in which Chipotle gave away $100,000 through a so-called BurritosOrBitcoin game that lets people guess a code for a chance at free bitcoin or a free burrito.)
Chipotle isn’t the only brand to either gamify or give away crypto. Last year, Burger King teamed up with financial firms Robinhood to give away Bitcoin, Ethereum and Dogecoin to people who spent $5 on the burger chain’s app. Last year, NFL star Aaron Rogers gave away $1 million worth of Bitcoin through the Cash App. Crypto handouts have also been a tactic for crypto exchanges like FTX and BlockFi as a means of getting people to open accounts – but also a dangerous and popular tactic for scammers over the internet.
Despite the heavy-handed title, Buy The Dip is part of Chipotle’s broader strategy to experiment with cross-game marketing in a variety of formats. It has also created several experiences on the online platform Roblox, such as a virtual Halloween maze last fall — which featured virtual costumes and other items — followed by a virtual store this year that let people roll a virtual burrito and earn one of 100,000 was given away in real life.
The games have been more popular than expected, according to Chipotle Chief Marketing Officer Chris Brandt. The latest crypto giveaway brought in nearly 4 million unique visitors who played 26 million times, while the Roblox games brought in nearly 7 million people who played tens of millions of times. “We certainly want to cement ourselves with fandom from the newest generation of both Gen Z and beyond and people who are tech-savvy and digitally savvy,” Brandt said.
Along with Roblox and online gaming, Chipotle has been experimenting with esports in recent years. In 2020, it began working with popular organizations, including content and menu item partnerships with 100 Thieves CEO Matt “Nadeshot” Haag and Twitch streamer, “BrookeAB”.
Chipotle took into account the popularity of games as they have evolved over the years, from Solitaire on mobile devices to Fortnite. “Everybody’s a gamer,” Brandt said.
The games have also been a way for the company to recruit customers to join its massive loyalty program, which Brandt says now has 29 million people. (People must sign up for the loyalty program before playing the games.) The loyalty program’s first-party data allows Chipotle to tailor messaging and offers to people and also help reach consumers directly at a time when third-party data is becoming less effective. He said the escalation of media prices in recent years has been “incredible”, prompting the company to eschew expensive TV advertising it used to buy in favor of cheaper channels on a range of platforms. However, Brandt did not say what these prices have looked like.
Last year, Chipotle spent $222.1 million on advertising, marketing and promotional costs, according to the company’s 2021 annual report — up from $222.2 million in 2020 and $168.8 million in 2019. (This includes costs for food giveaways.) Total ad spending in 2021 across digital, print and national TV was less than $100 million, according to MediaRadar.
Attention from crypto gifts often comes from customers who either already see the value or are “crypto-curious,” according to Liz Miller, vice president and analyst at Constellation Research. However, she said campaigns can fall short when they are focused on the “kitschy” part of crypto or NFTs.
“Random acts of advertising rarely create a lasting relationship,” Miller said. “The real risk that brands will face here is that these secure digital currencies are here to stay and will be the backbone of commerce in the coming metaverse economy. Break a consumer’s trust now with these campaigns, you may not see that trust will return in the coming universe of shared immersive experiences.”
Chipotle isn’t just giving away cryptocurrency — it’s now accepting it as payment, too. Last month, it began partnering with digital payment platform Flexa to allow people to buy food with crypto. Other major brands that accept crypto payments through a variety of partners include Starbucks, Gucci, Home Depot and Microsoft. And while it’s still a niche way to buy products and services, a May survey of 2,000 US adults found that 41% of those who haven’t owned crypto are “likely” to buy it in the next year compared to 59 % were told they are “unlikely.”
Despite the fact that more people have become familiar with crypto, there are other factors that determine whether it works as a marketing tool.
“These campaigns may be best suited for companies that consumers more immediately associate with crypto – such as financial services or gaming – to avoid consumers claiming that a brand inserted crypto into their strategy as a quick attention grabber,” said Kevin Tran, media & entertainment analyst at Morning Consult.
Chipotle was able to associate itself with the crypto community with its “Burritos And Bitcoin” campaign despite some hesitancy regarding the sector.
“Whether the market has gone up or down, the idea that we’re still talking about crypto is a pretty big win,” Brandt said. “Obviously there are people who think it’s some kind of Ponzi scheme, but there’s a lot of benefit to it and there’s obviously still a lot of interest.”
