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Virtual Restaurants: Generate Incremental Revenue During COVID-19

By Stacey Arenson

To say 2020 has been a challenging year for the restaurant industry would be an understatement. The pandemic has shuttered restaurants’ doors and dine-in services have been extremely reduced or even prohibited in some areas. However, one silver lining is that while restaurants’ in-house dining has taken a hit, off-premise business became their solace. One attribute to the success of off-premise business is the re-emergence of virtual concepts.

The restaurant industry has already been trending toward online ordering being the majority, but ever since the pandemic hit, this “trend” became one of the only ways restaurants could survive. The state of the restaurant industry will be very different moving forward, however one thing we know is online ordering and delivery is not going away. But why are some restaurants getting more business than others? While there are many factors to consider, there is one concept that if implemented within your restaurant, may show immediate returns.

We’re talking about virtual restaurants. What exactly is a virtual restaurant? It is any concept that is available exclusively online and does not have to be associated with your current brand. Let’s say you own a pizzeria, but your chef can also make amazing grilled cheese sandwiches. With a menu as simple as grilled cheese sandwiches and tomato soup, you can create your own virtual restaurant.

There are a few options for launching your virtual restaurant. You could open up a “pop up,” by leveraging your existing kitchen space and operating the virtual restaurant during hours you will already be fulfilling orders for your primary menu. This method has low upfront costs and does not require any long-term commitment to the virtual brand.

The second option for your virtual restaurant could be to work with a cloud kitchen company, like Kitchen United or Zuul. You can leverage their kitchen space to operate your own virtual brand from their massive facility. 

These two virtual kitchen options have displayed immense success in the past for large brands. However, what if you do not fall into that category? It’s easier than you would think. While the idea of launching a virtual concept may seem out of reach for smaller, independent brands–they may have less upfront capital to rent a cloud kitchen space, or perhaps a smaller kitchen space to work with–whatever the reason, we are here to tell you it is indeed possible–no matter the size of your restaurant. 

Restaurant as a Service (RaaS) is making it possible for brands of any size to take advantage of the benefits of virtual concepts without having to build and implement their own strategy. That’s where RaaS solutions come into play. RaaS is when a brand exclusively serves guests through a digital storefront while being run out of an existing brick and mortar restaurant. These companies perform the market research, curate the menu, and handle the marketing. All your restaurant needs to do is meet the concept requirements and you can plug it right in to your restaurant. 

Similar to online ordering and delivery, virtual kitchens are also not going away. The crucial takeaway is that you must adapt to where the industry is going to ensure your restaurant's survival, but even more than that, it will ensure your restaurant will also thrive during this unprecedented time.

 


Posted on Wed, Sep 09, 2020 @ 07:09 AM.
Updated on September 9, 2020 @ 2:00 PM PST.

Posted by Stacey Arenson

Stacey Arenson is the Director of Marketing at Chowly, a restaurant technology company that integrates third-party online ordering platforms with restaurants’ point-of-sale (POS) systems. Once the first marketing hire at Chowly, Stacey now leads the marketing team on all initiatives, including social media management, advertising, branding, design, content strategy, partner marketing, and conference/event planning.

Since joining in September 2018, Stacey’s leadership skills and history of producing successful marketing campaigns has enabled her to jumpstart Chowly’s marketing efforts and elevate its brand into one of the fastest-growing restaurant technology companies in the industry.

Stacey has over six years of experience and has held marketing positions at Groupon and 8Hospitality, bringing a wealth of restaurant industry knowledge and startup expertise to her role at Chowly.

Stacey holds a Bachelor of Business Administration with a focus in marketing from the University of Iowa.

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Tags: Online Ordering, restaurant delivery, Food Delivery, Virtual Restaurants

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