Also referred to as dark kitchens, cloud kitchens, or virtual restaurant brands, ghost kitchen brands eliminate the dine-in option offered by traditional restaurants. Instead, these focus on producing restaurant-quality meals and serving customers through third-party delivery apps like Uber Eats or commission-free food ordering apps such as One2.
Each year, more food entrepreneurs are selecting this concept for their restaurants mainly thanks to their lower cost and lower risk nature than brick and mortar ones. Indeed, according to the market research company, virtual kitchens could be a trillion-dollar business by 2030. In the United States alone, there are over 1,500 virtual restaurants. And the PKL Delivery Kitchens poll reveals that it is a whopping 12 times faster to set up a ghost kitchen than to set up physical restaurants. Especially, learning from the success and failure of other ghost kitchens like MrBeast Burger can help your company boost revenue. Here are some of those best lessons.
Best lessons learned from virtual brands
1. Create subsidiary virtual restaurant brands to focus on specialty items
Diners generally like a specialty store. They love the idea that a business is a real expert in its field, offering the absolute best. Thus, building a ghost kitchen dedicated to providing specialty foods should help establish credibility and increase sales for your restaurant.
On the one hand, rather than offering wide-rang items on a menu, you are recommended to highlight some select specialty items for your target customers. But on other hand, honing in on one niche does not equate to ditching the rest of your ghost kitchen food completely. You can build subsidiary or secondary brands that attend to your different specialty categories. For example, Stone Bridge Pizza did so by offering delicious baked sandwiches - made with bread using pizza dough, salt, and fresh herbs - as a subsidiary virtual brand named Rival Sandwich Co. The company's goal is to improve this item’s sales. It found success with that when selling three times the amount of sandwiches sold by Stone Bridge in its 1st week.
2. Get the most out of existing favorites
Flavortown Kitchen paid special regard to ordering trends from the ghost kitchen concept across the industry to define what consumers liked. The company leveraged that data to create patrons’ “all-time favorite real-deal menu items” (as cited in QSR Magazine) that come out of the same kitchen.
A pro tip in this regard is running marketing campaigns to keep guests updated about the addition of food favorites and offering discounts to improve their popularity. For the easier update of specials, you can use One2’s instant contactless QR code menu.
3. Consider the variety
Menu updates keep regular purchasers interested. According to the PKL Delivery Kitchens poll, more than 72% of respondents feel the need of updating a menu once a month.
Nevertheless, be careful about replacing the dishes. Partly owing to customer demand, McDonald made main changes to its menu (i.e., dropping 5 items and reintroducing fan favorites, including the Cheese & Herb Melts.
4. Let ghost kitchens be part of your brick-and-mortar strategy
There is not only one ghost kitchen model, meaning it is not required to be 100% “ghost.” While lots of delivery-only brands succeed with the virtual setup provided by cloud kitchens, many traditional restaurants manage to operate this business for the flexibility to serve their guests.
For instance, Wendy’s has decided to expand into more urban locations through ghost kitchens situated within shipping containers that they strategically put in parking lots. Thanks to this business model, the brand can serve new customers that its physical location otherwise could not.
5. Test new markets with minimum risk
Building a virtual brand needs lower costs than traditional restaurants with front-of-house staff. That is why this business model is a lower-risk way for chefs in small companies to test what does(not) work.
More specifically, they get to learn more about their customer’s demand, for example, whether people desire to purchase the food they cook. This enables the ability to make needed changes before settling on a dine-in location. Besides, from ghost kitchens, you gain more brand recognition that should help with the success of your physical building.
A popular example of this approach is Noodles and Company. It chooses to offer dark kitchens to see the city’s response to their presence. The restaurant actively runs these businesses before investing in a freestanding space.
6. Meet your audience’s changing demand
From recent events, companies have learned about the significance of adapting to market changes. When Covid-19 hit, they needed to figure out how to adjust. Time goes on and consumer purchase behavior changes, which highlights the need for the brands to accommodate a new set of demands.
The United States’ big supermarket chain, Kroger, proved how flexible it is by partnering with Kitchen United, one of the start-up virtual restaurants. Together, they are offering delivery and takeout food options from inside several Kroger grocery stores. This carries over the success in meeting a return in customer needs for dining in person.
7. Leverage your location
Picture this, your business is in the suburbs and your target buyers are 30 minutes away in the city. This will do no good to your delivery service. So, discovering the right location for your ghost kitchens is crucial.
When starting your search for a new kitchen space - or when considering leaving your current lease - account for how close you are to your target customers. The closer your ghost kitchen is, the swifter the delivery will be and thus the more satisfactory your purchasers will be.
8. Make the menus of your ghost kitchens the most accessible
An award-winning Japanese restaurant in Chicago, Sushi X knew how powerful One2 software for ghost kitchens is. With it, no website updates were needed. Whenever they hit “publish”, their menus are updated on their website. One2 also helps publish Sushi X’s list of dishes to social media and Google My Business with the push of a button.
Further, this system knew customers used 3rd-party ordering platforms. It took what it knew consumers loved about the delivery experience on these apps (e.g., the menu accessibility) and leveraged that knowledge to build a 1st-party delivery experience. Your guests can order their favorites directly through the One2 system. We hope you know that 1st-party delivery allows your restaurant to personalize every customer’s ordering experience and offers better insight into diner ordering data. Above all, it enables you to create more profits with commission-free ordering.
9. Capitalize on social media to generate buzz
YouTube creator MrBeast gave away free food and wads of cash in November 2021 as a Covid-friendly pop-up to promote his next ghost kitchen opening. By filming the event and sharing it across social media channels, MrBeast gained millions of views and worked out the business promotion.
A year later, his cloud kitchen, MrBeast Burger, keeps gaining popularity thanks to social media marketing. Its Twitter account with more than 110,000 followers does not fail to give followers updates on current promotions and deals.
It is safe to state that social media is a crucial tool for companies in the ghost kitchen industry. Your social channels can appeal to new guests by encouraging them to try new food in image-driven menus, which works more easily with One2’s contactless menu. Also, use One2 to quickly update specials such as offering a free meal treat for 1st-time customers.
10. Bring guests back for 2nds (and 3rds and 4ths…)
Pauly D’s line of sub sandwiches keeps itself at the forefront of the customer's minds by using a straightforward and effective website and list of dishes available and encouraging guests to register for the newsletter Sub Club. This newsletter shares any new store location and new items along with specials. As an added incentive, the brand offers those registering for the 1st time an exclusive discount on their next purchase. With this regular loyalty and rewards program, the restaurant works to capitalize on repeat diners.
Remember that revenue from repeat guests is the easiest revenue your brands will ever earn. Because they already know your restaurant brand and food, some push is all they need. One2 makes it simple to develop customer loyalty programs, maximizing your revenue from diners making repeat visits. Besides, think about setting up a newsletter to keep patrons updated on your ghost kitchens and encourage them to come back for 2nds.
11. Remember the significance of catering equipment cost-saving and maintenance
In the PKL Delivery Kitchens poll, 100% of respondents considered catering equipment and maintenance costs as significant. There are some ways to influence these expenses, including the food served and the kinds of catering equipment that support the peak volume. Maintenance-wise, frequency and capacity play a part as well. For instance, should your ghost kitchen keep working at maximum capacity, maintenance is more frequently recommended.
1. Why are virtual restaurants not a setback but a silver lining?
These are an instance of the resiliency of global restaurants in the face of Covid-19. Instead of closing their businesses, they can meet customers’ high demand for delivery with a virtual restaurant. This concept likewise encourages experimentation and empowers chefs with humble financial backing.
In this regard, virtual restaurants are helping to bring cooking to its original art form. They are meant to be a kitchen making meals for those they care about.
Pros of ghost kitchens:
Enable flexibility of menus.
Cater to modern customer expectations for delivery orders.
Have a small environmental footprint compared to a customer-facing concept.
Lower overhead than what you have to spend to operate a physical restaurant.
3rd-party delivery services can be costly.
Food needs tailoring for delivery.
Have less connection with customers.
It is worth addressing that One2 can help you handle the cons of running a ghost kitchen. Contact us for further details.
2. What are the best ghost kitchen brands today?
Multiple brands mentioned above, there are also some other great dark restaurant brands:
Kitchen United located in Pasadena, California
It's Just Wings
Maggiano's Italian Classics
Pasqually's Pizza & Wings
The Big Melt
3. How to convince the target audience you are reliable through branding?
Determine a suitable name and logo for your virtual restaurants.
Have a well-thought-out brand.
Create a restaurant website.
Hone in on food photography.
Promote your restaurant through social media.
4. I want to prepare food on chicken. Then, what should I make in my ghost kitchen model?