A confession. I didn’t know who the beast burger was until a few weeks back. I am not a big YouTuber and I limit my knowledge to second- or third-hand personalities.
He is known now as beast burger- the personality behind the restaurant chain that is now the largest in America. He was created with Robert Earl, the restaurateur. Joe Guszkowski, my colleague, recently noted that the virtual concept was launched in December with 300 locations. The app quickly rose to the top of the Apple Store for food and beverage apps. On Friday, it was 29th. This was ahead of Wingstop and Panda Express.
This concept’s early success is a testament to the potential of virtual concepts and whether they can be launched without the support of large chains and their existing infrastructure. If the early returns are lasting, MrBeast could launch a lot of other competitors. It could be already doing so.
Virtual brand such as Beast Burger
Why? Because a virtual brand such as beast burger can be a great way to break into the restaurant business without having to invest a lot of capital. A virtual concept can be developed by an investor that attracts attention to the business without the need for traditional brick-and mortar locations. This could bring in significant cash. Traditional concepts that have been funded the traditional way could find it more difficult to raise funding.
This is what happened in 2019, when Popeyes Louisiana Kitchen introduced its chicken sandwich. One tweet about the sandwich caused a surge in interest and led to one of the most successful quarters ever recorded by a restaurant chain. This restaurant chain has already generated $1.3 billion in sales over the past two years.
Mark Wasilefsky from TD Bank’s franchise finance group told me last month that “You have social media now.” “In the past, the best way to get food to people was to have great restaurants and make great food. It would be talked about. They would place an advertisement in the newspaper, radio, or television.
“Now, take a look at what actually happened. It was a social media boom. If people love your product, they will tell others about it. It’s possible to build a brand without anyone ever walking into your store. That’s unique.”
Restaurants used to need to develop a concept, locate a location and build it out. Then, they would use local marketing to drive people to the store. Virtual brands take that work out of the equation. They generate less cash, but they are more appealing to consumers who don’t walk in. However, the lack of buildout expenses could be a benefit to a concept and help it get off the ground. This could eventually lead to a brick-and mortar location.
This will be a strong market for big restaurant chains. It’s Just Wings, another important concept from Chilis, has quickly generated strong sales. Parent company Brinker International plans big things with it. This includes a possible brick-and-mortar store.
Virtual concepts can be like winning a lottery, to be certain. According to Sterling Douglas (CEO of Chowly, a tech company), there are approximately 100,000 virtual concepts. It is very possible for a new idea to go nowhere. The risk of a virtual idea going stale is very low if you don’t need to borrow a lot. It is still beneficial to have a connection with someone who has a following.
Earl has worked with many celebrities on concepts. Guy Fieri, his friend and collaborator on the Chicken Guy concept, is now behind a virtual company, as well as Mariah Carey, Tyga, and Tyga.
MRBEAST BURG meanwhile has 53 million subscribers to his YouTube channel and Sullivan was able tell them to have his burger. The concept continues to gain attention and sell quickly.
It will be interesting to see how beast burger performs over the long-term. Virtual brands still need to be quality–they must keep customers coming back. Burger customers don’t have many options. Delivery is only a small part of the industry, so virtual brands will rely heavily on customers ordering it at a higher level after the pandemic. It is doubtful, I think.
Furthermore, 300 virtual locations are not the same thing as 300 brick-and mortars.
Even if MRBEAST BUGER fails in the long-term, it still has potential. Investors could be interested in pursuing this idea, which could lead to them becoming investors.
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