‘Ghost Brands’ Deliver a Spirited Performance during Pandemic
‘Ghost Brands’ Deliver a Spirited Performance during Pandemic

Traditional restaurants have been hit hard by COVID-19 … but “ghost brands” have stepped in to fill the gap and may signal the way forward for restauranteurs in the post-pandemic era.

Hong Kong’s restaurants haven’t had it easy over the past year with the pandemic battering business and sending customer numbers plunging as people stay at home.


The very notion of opening a new restaurant in such a climate might seem insane – but there is one model of restaurant that has succeeded in the downturn because it involves no rent, no shop front, no dine-in areas, and no waiters. Just food and delivery.


The “ghost brand” is a relatively new business model for restaurants to develop a second brand that offers a different menu. Using existing resources such as kitchen and staff, it exists only virtually to save costs and drive revenue.


A ghost brand allows a restaurant operator to test a new business idea with minimal additional capital spending. Without a physical restaurant, the operator only needs to worry about the menu, the food supply, the market demand, and the logistics of delivering the food.


This model not only allows restaurants to create new brands at low costs. It also opens up opportunities for non-restaurant operators to launch restaurant brands easily, leading to more crossover among different sectors. And with the pandemic generating a boom in home delivery, it may be the perfect business model for our times.

foodpanda Hong Kong’s Head of Shared Kitchens Ryan Ching says creating a restaurant brand allows the food delivery platform to put its customer insights into good use.​

Catering to changing tastes

foodpanda, one of the most popular online food order and delivery platforms in Hong Kong, realised the ghost brand business model was a natural fit if it wanted its own restaurant brand, instead of only selling other restaurants’ food.


There was no need to build a physical restaurant and hire waiters, and foodpanda’s strength was in delivery. The only thing it needed was a partner to cook the food.​


Ryan Ching, foodpanda Hong Kong’s Head of Shared Kitchens, recalled the experience of setting up the platform’s first ghost restaurant brand in Hong Kong, Pasteria, in June 2020.​


“Through the years, we were able to identify the cuisine gap, potential customer groups, delivery locations, and response rates to specific promotion periods or offers,” Ching says. “The question was: How could we put our insights to good use?”

Inspired by the concept of virtual restaurants, foodpanda began hunting for a catering partner to work with them in creating its first ghost restaurant brand, with the primary aim of offering more meal choices to customers.


And it was through various business events run by CLP such as the 6 Senses Experience Zone at HOFEX and the Central Kitchen Fair that foodpanda made contact with LA CASA. 


CLP Power Senior Director – Customer and Business Development Lena Low says one main purpose of the events is to offer opportunities for catering partners to explore business opportunities while learning about CLP’s support for the industry. “Through creating various platforms and fairs to introduce smart, green culinary concepts to the catering industry, we can bring together new partners to promote the latest business concepts,” she says. 


Established in 2012, LA CASA is a central kitchen service provider, with a kitchen in Kowloon Bay and an Italian restaurant in Sheung Wan specialising in burgers and pasta.


Explaining how it came to choose LA CASA as a partner, Ching says it also gave Pasteria’s customers the option of picking up the food at LA CASA’s Sheung Wan restaurant.


"Their restaurant is located close to the central business district of Hong Kong, and their decent shop front is a big plus for customers and the delivery team to pick up orders,” he says. “Besides, pasta is always a good idea."

An effective double act

foodpanda and LA CASA worked together in creating Pasteria, with both parties focused on their expertise and roles. Customers can now order online at Pasteria using the foodpanda app, and LA CASA will then prepare and cook the dishes in their Sheung Wan or Kowloon Bay kitchens. Customers can either choose to pick up their orders at LA CASA’s Sheung Wan restaurant, or have their meals delivered.​

foodpanda adds value to the partnership by drawing on its insights into evolving market trends and big data analytics to devise the overall branding strategy, as well as promoting and selling the food through its app.​

LA CASA, on the other hand, regularly experiments with new flavours and refreshes the pasta choices according to customers’ preference and the latest trend analysis.​

Pasteria's menu
Virtual restaurants, such as Pasteria, have become a popular business model in the catering industry as people stay at home more often.

Delivering results 

As a pioneering business venture, Pasteria has proved to be a successful case in Hong Kong, using innovative concepts in the city’s catering industry and bringing in more choices for customers.


In the space of six months, Pasteria has been able to reach its sales target and receive fantastic view, click and order rates on the platform. It is expected to achieve higher sales growth in the coming year with seven outlets covering Hong Kong Island and Kowloon sides now open.​


Encouraged by the experience, Ching says he is looking forward to bringing in more brands and cuisines using the ghost brand business model. “It is a fantastic opportunity for us and catering operators to join hands and promote business growth in 2021 and beyond,” he says.