Virtual restaurants grow with TikTok Kitchen, Tijuana Flats' Smack Wings

Orlando restaurateur Robert Earl plans to offer eateries a chance to serve a delivery-only menu based on trends from the popular short video app TikTok in 2022, just the latest twist in the growing virtual restaurant trend.

Virtual restaurants offer menus that existing restaurants can add with different names on delivery apps such as Uber Eats without the expense of additional physical space for a new business.

Expected to launch in March, TikTok Kitchen's menu will be based on viral food from TikTok, including baked feta pasta and Korean hot dogs. Earl said the intent is to switch out menu items based on new trends from the app.

Earl said TikTok Kitchen solves the problem of how to market virtual restaurants. TikTok has more than a billion users globally.

"This answers some of the ... outstanding questions about the longevity of virtual," Earl said in an interview. "How do we have something that keeps your interest and is ever-changing? And how do we have a brand that even though it doesn't have any what we call brick-and-mortar physical buildings, that you feel attached to it?"

Earl isn't alone in creating new virtual restaurants even as people are starting to eat out more again after opting to stay home for much of the pandemic. Winter Park-based Tijuana Flats recently launched its own Smack Wings virtual restaurant.

Earl's Orlando company, Virtual Dining Concepts, has several virtual restaurants including NASCAR Refuel and MrBeast Burger where the food is prepared at Earl's restaurants such as Buca di Beppo or at eateries owned by others.

TikTok Kitchen will be the latest entry in that vein.

Earl anticipates having it in about 300 restaurants across the country on opening day, and eventually 2,000 in the United States and Canada. It will be available on delivery apps such as Grubhub.

The Orlando area could start with four restaurants offering TikTok Kitchen.

Earl said TikTok and delivery apps share an audience.

"They actually have an identical profile, not even similar, identical," Earl said. "They're the most desired audiences for the third-party platforms. They're the most frequent users of delivery."

Earl said his most successful virtual restaurant so far has been MrBeast Burger, a partnership with YouTube celebrity Jimmy Donaldson, better known as MrBeast. Earl said the brand is in 1,500 restaurants and served more than 5 million burgers and sandwiches in its first year.

"It's an amazing achievement," Earl said.

Elsewhere, Tijuana Flats launched its Smack Wings virtual restaurant in November, which is now in 105 company restaurants and 18 franchise locations.

The delivery-only wings menu features 10 sauces and rubs from traditional Buffalo to Thai sweet and spicy on apps DoorDash, Uber Eats, Postmates and Bite Squad. It is Tijuana Flats' first virtual restaurant as the company sticks its toes in the water, CEO Brian Wright said.

"The world of virtual brands really exploded over the last 12 to 24 months," Wright said.

Tijuana Flats expected third-party delivery business would slow coming out of the pandemic, but it has only increased, Wright said.

For just Tijuana Flats, third-party delivery was in the neighborhood of 5% to 7% of business when Wright arrived in 2019, but now he said it is in excess of 20% and closer to 25%.

"People just got used to this as a way of life," Wright said.

Earl, who is also behind Planet Hollywood and other national brands, points to the growth in delivery before the pandemic as well as its projected growth.

"When I look at the complete picture, online delivery is the fastest-growing sector by far of our restaurant industry," Earl said. "I think that the virtual side is the big growth area. ... My view is it continues to grow. If anyone is going to suffer it might be one less meal that you cook yourself."

Earl added his brands have partners that can market the menus to their audiences. MrBeast has more than 86 million YouTube subscribers.

Earl said his Orlando-based Virtual Dining Concepts has more than 100 employees.

"I think I reflect the confidence in the space from very sophisticated investors," Earl said.

More restaurants were opening before the onset of coronavirus, and they all needed extra sales, Earl said. Virtual restaurants are a way to generate that business.

Virtual restaurants have thrust the industry deeper into the internet age, he said.

"I think that the digitization in the restaurant, hospitality industry has been slower than most other industries," Earl said. "It's arrived now, and one of the beauties is what it's done for restaurants on delivery."

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