During the worst of the pandemic, Americans turned to delivery instead of going out to eat. That trend reversed somewhat in November as people returned to restaurant dining rooms in the largest numbers since Covid hit, but delivery has become something that many people now use for food options well beyond the traditional delivery foods like pizza and Chinese.
Even as they must deal with pretty much every restaurant partnering with Uber (UBER) - Get Uber Technologies, Inc. Report, DoorDash (DASH) - Get DoorDash, Inc. Class A Report, and other delivery companies, a number of ghost kitchens and virtual dining concepts have popped up to compete with traditional brick-and-mortar chains.
Ghost kitchens/virtual restaurants lack traditional storefronts. These delivery-only restaurants operate out of shared kitchens or in kitchen spaces located inside existing traditional restaurants.
One company, Virtual Dining Concepts, has been a leader in this space, partnering with diverse players including Penn National Gaming's (PENN) - Get Penn National Gaming, Inc. Report Barstool Sports, Nascar and, now, social-media platform TikTok.
Barstool, Nascar and TikTok?
Virtual restaurants/ghost kitchens also lack the visibility of traditional eateries. Customers won't drive by to learn that they exist.
Instead, they need concepts or brand names that grab people's attention when they scroll by the restaurant's name in a delivery app. Barstool Sports, Nascar and TikTok all have devoted followings and brands that catch people's attention.
TikTok has become the latest -- and seemingly the least likely -- brand to join the VDC portfolio. The concept is expected to launch with 300 locations with plans to expand to 1,000.
"The menu is inspired by the hottest food trends on TikTok," VDC explained to prospective partners on its website. "The dishes celebrate food trends made famous by TikTok creators. TikTok, with over 1 billion subscribers, provides a space for a wide range of creators to post videos featuring recipes and food hacks."
Nascar may not scream food, but it's a huge brand with a passionate fanbase. VDC has partnered with DoorDash to deliver some favorite items from the menus at a number of Nascar tracks.
Handpicked from 12 Nascar-owned racetracks around the country, Nascar Refuel’s delivery-only menu features “Refuel Combos” and individual items including classics such as the Daytona Firecracker Dog, Talla-Mento Dogwich, Darlington Pimento Cheese Sandwich, Refuel Burger, and more. Watch for exciting new menu specials, highlighting regional classics inspired by Nascar racetracks, starting at the kick-off of the 2022 season with special items being added on an ongoing basis.
Barstool Sports, which has perhaps the most dedicated following of any of these three, offers a delivery-only menu of food items inspired by the website's content creators. The menu offers creative twists on sports-bar staples, including wings, sandwiches and appetizers.
The Rise of Ghost Kitchens
"Virtual brands, ghost kitchens, delivery-only concepts — whatever you call them — have thrived during Covid-19. Euromonitor, a market research firm, recently estimated that they could be a $1 trillion business by 2030," Eater's Kristen Hawley reported.
The biggest challenge for virtual brands, however, may be standing out in an increasingly crowded space. That's something VDC's brands have an edge in. Barstool. Nascar and TikTok have existing audiences that can be reached through the channels that made those brands so popular in the first place.
VDC Co-Founder Robert Earl says the Orlando, Fla., company's experience working with YouTube personality "MrBeast" on his MrBeast Burger virtual restaurant chain will help it succeed with the YouTube brand.
“I think that after a year or two of learning, and fabulous success with MrBeast, we understand the important issues of how to stay interesting to the consumer, how to constantly change, how to keep up awareness and TikTok as a platform answers all of that,” Earl told Nation’s Restaurant News.