Yeah, smart bikes have a single drive ratio. It’s not 1:1 and probably closer to something like 3:1 or higher if I had to guess. Easy enough to find out when you count the flywheel revolutions you get from a single crank rotation, for anyone curious to learn the actual ratio.
As such, the “shifting” is not changing anything physically like we get with a real geared bike drivetrain. The smart bike shifting is only altering the baseline resistance applied in something like a Simulation or Resistance Mode. It will do nothing in the case of ERG mode use, as you experienced. We discussed this related to the Stages SB20 in another thread, and Stages confirmed this info. I am pretty certain the Kickr Bike is working similarly.