Smokey Bones is committed to its dine-in customers, which spend more time purchasing appetizers, alcohol, and desserts, but the company also wants to make it known that off-premises guests—those that value convenience, speed, accuracy, and temperature—are just as important. That’s the exact reason why the chain is piloting a drive-thru location in Bowling Green, Kentucky.
With the pandemic forcing customers into their homes, virtual brands have exploded in the past two-and-a-half years as a way for restaurants to expand kitchen capacity and reach new customers. The business is so big now that some companies supply digital concepts as a service; like Huddle House and Perkins Restaurant & Bakery using Virtual Dining Concepts’ MrBeast Burger, or TGI Fridays using C3’s Krispy Rice. Independents are in the space, too. A Grubhub report in January found that 41 percent of independent restaurant owners offer virtual restaurants, with the average number used being 5.7.
The beauty of Smokey Bones’ virtual brands, O’Reilly says, is that none of them impact culinary execution. Bowls, wings, burgers, and tenders are already on the Smokey Bones’ menu, so back-of-house team members are accustomed to processes and ingredients. The CEO also pointed out that operators are used to launching LTOs and new flavors throughout the year, so there’s familiarity with folding in new production.
“They're very good at receiving training programs for new flavors and new forms of things that they already know how to execute,” O’Reilly says. “So we work these virtual brands into our rhythm, our operating cadence as a company, and roll them out with lots of training materials. We have an excellent training function and the restaurants receive them very well and have begun to execute them very enthusiastically.”
Although virtual brands have become an incremental part of business, overall consumer awareness is still catching up. In 2021, Sherri Kimes, an emeritus professor at Hotel School at Cornell, conducted a survey of U.S. adults 18 and older that found only 4.5 percent heard of virtual brands and only 22 percent knew of ghost kitchens. O’Reilly says Smokey Bones hasn’t had significant issues with confusion because each brand was created with the mindset of, if it couldn’t survive as a standalone entity, it wouldn’t be viable as a ghost concept. Secondly, the chain never hid the fact that it’s behind the virtual brands; it’s not explicitly stated on online platforms, but at the same time, brick-and-mortar restaurants have signage saying things like “Home of the Wing Experience.”
To Smokey Bones, virtual brands aren’t a gimmick used to simply survive the pandemic. There’s staying power, and the brand is ready to prove it.
“Our commitment to our off-premise business as a growth driver is permanent,” O’Reilly says. “That will always be a part of our focus as a company. We will continue to use virtual brands over the years. We do not think of them as a Band-Aid to get us through the pandemic whatsoever. We view it as a real market opportunity in the restaurant industry. The brands themselves, we view them as distinct revenue streams and evaluate them over the years and over time. So over time, some may come, some may go, but it's a strategy that we believe in.”