Club Converts to Burgers and Beer Restaurant


A North Carolina nightclub converted to a restaurant fairly seamlessly by offering late-night specials

Draft Carolina Burgers & Beer
Owner: Dean Ogan
Location: Raleigh, North Carolina
Annual Sales: Approx. $1.4 million
Segment: Pub

Changing a North Carolina concept from a sports bar-club to an upscale sports bar-restaurant concept called Draft Carolina Burgers & Beer wasn’t a simple move.

It required finding new customers, promoting a late-night business without seeming club-like, and converting the menu to mostly local foods and beverages.

Dean Ogan and his company, Rocky Top Hospitality, operated a club, Hi 5, for eight years, in a Raleigh, North Carolina neighborhood, that is known for its late-night scene.

“But we wanted to get out of the club business,” he says. “We own several restaurants and had a couple of clubs but it wasn’t our personality, and wasn’t what I wanted to do with our business. So I decided to get back to what we’re good at doing, which is restaurants and bars.”

The club business is also remarkably fickle, he explains. “[Our business] went well for a while but as happens with clubs, a new club opens and you become the old club.”

So in May 2011 Draft Carolina Burgers & Beer was born.

But such a drastic change in concept—Hi 5 only served bar snacks for $5 and under—required marketing to a whole new crowd.

“We went after an all-new customer for Draft,” Ogan says. “Hi 5 had a very young crowd that spent a lot of money on alcohol from 10 p.m. until 2 p.m. Sales were 75 percent alcohol. Now 50 percent of sales come from alcohol and most of our business is between 5 and 10 p.m.”

The challenge since Hi 5 converted to Draft Carolina Burgers & Beer, Ogan says, has been letting people who’d been coming for the club and the $5 food for eight years know that something was different.

Before Draft opened, Rocky Top Hospitality did a lot of marketing. Fortunately, it had accrued a mailing list of close to 40,000 people over its years in business, “so we hammered the message home that way, starting with people who were already fans,” Ogan says.

Most marketing was online, he says, but he also ran a LivingSocial coupon that helped draw in many first-time guests, and some newspaper advertisements. “Plus, Raleigh is a small place, which helps with word of mouth,” he adds.

But almost a year in, sales are still not quite where Ogan would like to see them. “We’re in the black, but about eight to 10 percent off where we’d like to be,” he says.

What Draft really needs to do, he explains, is build up its late-night business, but at the same time, “we don’t want to promote that feel.”

However, he adds, “we’re just going to be persistent, and are going to promote drink specials of cocktails and beers for people to come in and sit down.”

Draft also holds a $20 ‘Keep the Glass Night’ on Saturdays with rotating microbreweries’ glasses, filling up the glass all night for the initial cost of $20.

A typical night sees around 75 people opting for this special, he says.

“Even if people drink four or five beers it’s profitable but not as much if they were bought singly. But the thing is, you’ve got to drive incremental sales because once people are in, they order some food.”

On Friday nights Draft runs a ‘You Name it Night.’ This program was incredibly successful at Hi 5, Ogan says, and offers every drink for $4.

This program was recently launched and the first week it ran, sales were double those of the previous Friday, Ogan points out.

“We also saw tremendous incremental sales,” he adds. “People see the value in the drink and then think they can order some food. “

Beyond converting to a restaurant concept, Ogan also wanted to give Draft a local feel, with drinks and food coming from nearby. Around 40 percent of the 44 tap beers come from North Carolina, he says, and the kitchen prepares as much local food as possible.

Serving local food in a burger joint is “pretty unique,” he says, “since it’s usually fine dining that does that. Our take is that we’ll do it with burgers and put some premium ingredients in.

“And it’s the right thing to do to support local farmers and growers. We do it in our other restaurants so we’ve continued to create the menu with more and more local vendors.”

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