Unlike previous generations, millennials do not flock to big brands but (claim to) look deeper. There is a demand for authenticity and smaller concepts, such a pop-ups, convey authenticity much easier than big brands. In addition, there is a demand for variety. Across the UK and many parts of Europe, The Beaver is noticing an enhanced movement towards street food, food trucks and market halls that are seemingly riding this wave of change.
Another trend that the Beaver has taken notice to is large restaurant chains reacting to this movement by creating spin-off concepts. Think a little along the lines of how McDonald’s expanded its offer with McCafé – delivering a new small brand to stay interesting and relevant to specific markets, demographics and footfalls.
While McDonald’s is a beast of a brand, the time-shared dark kitchens of Deliveroo Edition are become a platform for ‘virtual test brands’, which initially only exist on Deliveroo. What started as an invite for street food vendors to sell from dark kitchens to keep the offer exciting has turned into an incubator for food and beverage start-ups. Operators are now using the platform to try out new concepts or dishes.
For the smaller operators, the advantage is to test their concept before committing to all the costs that come with setting up a new restaurant in a physical space. For existing big brands, this method allows them to try out completely new concepts without the affiliation to the original brand. Why is that an advantage? Think about it: would you want to eat Asian noodles from a Mexican chain?
Other innovation grounds include Wahaca’s Test Kitchen or Wagamama’s Noodle Lab. These units are used for menu innovation and instant feedback, allowing the brand to trial ideas on live customers before rolling them out nationally, if they work that is.
One London chef ran a year-long pop-up restaurant in Soho last year called Test Kitchen. The idea was to work on the menu with feedback from a public audience. Of course, all of this can also be done on a much smaller and simpler scale in a food truck or pop-up space, which in turn creates hype. However, this example is meant to show that it can be done, and is being done, in traditional bricks and mortar spaces as well.
Landlords can benefit from this movement by incorporating a so called test kitchen into their F&B mix and curating it with frequently changing offers. However, The Beaver believes the disadvantage is the initial capital investment for the fit-out and the challenge to value the asset, since there will be no long-term lease and low if any fixed rents. The advantage is that this flexible space has the potential to deliver a frequently changing, authentic and constantly exciting offer, which will keep guests talking and posting about it and drive footfall up.
With all the events occurring in the F&B market right now, The Beaver will be keeping an interest in this test kitchen model, especially looking at whether those operators that are failing to a degree decide to try out smaller, more innovative ideas. Food for thought, as they say…