Will Virtual Kitchens Persist or Go Brick-and-Mortar?
by David Klemt
Virtual kitchens and virtual brands are back in the headlines after a record-setting grand opening in Rutherford, New Jersey.
Well, I should clarify: A restaurant may now hold a specific record.
The restaurant in question is the first brick-and-mortar MrBeast Burger location. And the record it may hold claim to is most burgers sold in a single day by a single restaurant.
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Now, if you don’t spend much time on YouTube, you may not know MrBeast. So, here’s a quick rundown: He’s Jimmy Donaldson, a YouTube personality known for “expensive stunts.” In fact, he may be the pioneer of that type of content.
Right about now you may be wondering what this all has to do with virtual kitchens and brands. It’s quite simple, really. MrBeast was among the highest-profile virtual brands to launch during the pandemic.
Incredibly, MrBeast Burger boasts more than 1,700 virtual kitchen locations. And now, one brick-and-mortar MrBeast restaurant.
Leveraging Demand and Popularity
So, you’re an influential YouTube content creator with tens of millions of subscribers. Obviously, your channel is monetized. What else can you do to leverage your popularity?
Well, if there’s a pandemic crippling the globe and people are stuck at home, maybe you notice the demand for takeout and delivery. And perhaps you learn about something known as a “virtual kitchen.”
If you’re a foodie or maybe just a savvy businessperson, maybe you’d jump into the virtual space. It is, it goes without saying, much less expensive than opening your own restaurant. And if you perform well, that’s an excellent way to collect data and guest feedback.
Also, an efficient way to hone your brand without a lease, buildout or the overhead of a physical restaurant. In a way, a virtual brand is akin to a pop-up restaurant, only you can test hundreds of markets simultaneously.
Okay, so now let’s say you reach a rare milestone in the creator space: 100 million subscribers. MrBeast did just that in July of this year. Do you think you’d want to leverage the support of millions of fans willing to support you and your brand?
The first physical MrBeast Burger opened last week at the American Dream mall in New Jersey. Reports claim that over 10,000 people waited in line for the grand opening.
Oh, and that’s when the location may have claimed the aforementioned record: 5,500 burgers sold in one day. After just one day of operation, MrBeast wondered if the brand should franchise:
should we… franchise? @mrbeast
— MrBeast Burger (@MrBeastBurger) September 15, 2022
Virtual to Physical
This (potential) record-setting event brings virtual kitchens and brands back into the spotlight.
Of course, most virtual brands don’t have the same origin story as MrBeast. One hundred million supporters? That’s rarified air.
At any rate, virtual kitchens do offer potential physical restaurant operators a less expensive method of testing their concepts. Couple data collection and feedback with an accurate feasibility study and taking the next step may make sense. And it may make a tidy profit.
It’s possible we’ll see MrBeast franchise off the success of two years of operating virtually and opening a physical location. And it’s possible we’ll see other virtual brands expand beyond the virtual kitchen.
However, it’s important that virtual brand owners keep a few things in mind. One, online success doesn’t always translate to brick-and-mortar success. Two, the restaurant space doesn’t care about your subscriber count—the KPIs are entirely different here. Three, potential operators need to perform the proper studies—or retain an agency with experience performing them—rather than rushing into the restaurant space.
It’s highly likely we’ll see more virtual brands enter the physical restaurant world. How many will do so successfully remains to be seen.