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Is OpenTable Worth it?

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Re: Is OpenTable Worth it?

#21

Post by waterlesscloud »

dotBen wrote: post #16

The crux of the argument made by the post is that a restaurant makes $10 profit on a $200 4-person cover yet OpenTable takes $10.40 for that booking (I want to call BS on those figures but lets ride with it) In an earlier part of the piece, the author states that "[his restaurant owner friend] believes that if he stops offering it, his customers will revolt and many would stop coming to his restaurant. So he keeps pa…

From OpenTable's info, the booking per diner is $1.00 if done via OpenTable's site, but only 25 cents per diner if done via the restaurant's site. This suggests certain approaches....

Re: Is OpenTable Worth it?

#22

Post by jimbokun »

prawn wrote: post #17
aaronbrethorst wrote: post #10

Earlier quoted context omitted.

I don't doubt that for a second. In fact, I would've guessed that most top tier restaurants would shy away from using such systems. But, as it works out, though, there are a bunch of Michelin-starred restaurants in the Bay Area that are on OpenTable: http://www.michelinguide.com/us/sf_stars_2011.html

In August, I used OpenTable to get a reservation at a Michelin-starred restaurant in CA (is Sonoma considered Bay Area? I'm not from the US so not sure) about 15 minutes beforehand. Process worked perfectly. At 8pm, we arrived at a hotel in the area and looked online for a place to eat. By 8:10 we'd booked. By 8:16, we'd ironed clothes, showered, driven and arrived for a great meal. Ringing around looking for a table…

"By 8:10 we'd booked. By 8:16, we'd ironed clothes, showered, driven and arrived for a great meal."

Wow. You iron, shower, and drive a whole lot faster than I do.

Re: Is OpenTable Worth it?

#23

Post by ben1040 »

noodle wrote: post #11
ben1040 wrote: post #4

Not long ago I placed a reservation through OpenTable, and a couple minutes after we had been seated, I got an email from OpenTable telling me the reservation had been canceled from the restaurant's end. Now I wonder if this was an honest mistake, or a strategic cancelation to try to stiff OpenTable on the per-reservation fees. Obviously they couldn't do that with every diner who walked in the door, but maybe they co…

depends on who is dining, but that might make the type of person who is trying to accumulate opentable points mad.

I'm that type of person, which is why it bothered me and it even sticks in my mind at all now.

The reservation that was canceled would have tipped me over the threshold to get a cashback reward, so I let OpenTable know and got my points.

The restaurant wasn't very good anyway, which was a factor in my decision as to whether or not I should've taken it up with OpenTable.

Re: Is OpenTable Worth it?

#24

Post by dotBen »

waterlesscloud wrote: post #21
dotBen wrote: post #16

The crux of the argument made by the post is that a restaurant makes $10 profit on a $200 4-person cover yet OpenTable takes $10.40 for that booking (I want to call BS on those figures but lets ride with it) In an earlier part of the piece, the author states that "[his restaurant owner friend] believes that if he stops offering it, his customers will revolt and many would stop coming to his restaurant. So he keeps pa…

From OpenTable's info, the booking per diner is $1.00 if done via OpenTable's site, but only 25 cents per diner if done via the restaurant's site. This suggests certain approaches....

Yes, but that doesn't match what the post author says based on his figures.

It could be opentable cost = booking fee per diner + setup costs + monthly fees. I'd like to know more.

Re: Is OpenTable Worth it?

#25

Post by neilc »

aaronbrethorst wrote: post #3

"[R]estaurants find that they themselves no longer own the customer relationship." This is the dumbest thing I've read today. I am sitting in your restaurant! I am voting with my dollars by choosing to show up at your establishment! If I like what you have to offer, odds are I'll be happy to give up some personal information. If you want to know my email address to inform me of special events, or to give me a gift ce…

[If] you're not on Urbanspoon's Rez system or on OpenTable, you may as well not even exist.

Perhaps to you, but I think that attitude is rare. I think most people find a place where they'd like to eat, and then they choose the easiest way to make a reservation -- the difference in convenience between Opentable and the telephone is pretty small. If I'm going to spend $$ on a nice meal, finding a good place is my priority; if I need to call them or tolerate their shitty Flash website, so be it.

Personally, I rarely use Opentable: apart from the fact that they take some of the restaurant's revenue, they can also report false negatives. For at least one restaurant I go to often (Ad Hoc in Yountville), there is almost never a good time available on Opentable, but there often is if you call the restaurant. Since I can't trust a "no availabilities" result from Opentable, it is easier to just call and speak to a live person.

Re: Is OpenTable Worth it?

#26

Post by aaronbrethorst »

neilc wrote: post #25
aaronbrethorst wrote: post #3

"[R]estaurants find that they themselves no longer own the customer relationship." This is the dumbest thing I've read today. I am sitting in your restaurant! I am voting with my dollars by choosing to show up at your establishment! If I like what you have to offer, odds are I'll be happy to give up some personal information. If you want to know my email address to inform me of special events, or to give me a gift ce…

[If] you're not on Urbanspoon's Rez system or on OpenTable, you may as well not even exist. Perhaps to you, but I think that attitude is rare. I think most people find a place where they'd like to eat, and then they choose the easiest way to make a reservation -- the difference in convenience between Opentable and the telephone is pretty small. If I'm going to spend $$ on a nice meal, finding a good place is my prior…

Yes, that is my opinion. I don't doubt that I'm in the minority. Still, for me, OpenTable or Rez support is critical. My girlfriend and I will routinely pick a place to eat on a Friday or Saturday 30 minutes before we intend to eat. I don't like having to call a half-dozen places in order to get a table, and I wouldn't have much choice without these systems.

If the restaurant is unable or unwilling to report their true availability, then the value of OpenTable decreases dramatically.

Re: Is OpenTable Worth it?

#27

Post by Monkeyget »

waterlesscloud wrote: post #20

From OpenTable's own data, their revenue averages $600 a month from a given restaurant. Not a negligible cost, but doesn't seem outrageous. Probably room for someone to undercut that, but it doesn't seem that the cost of restaurants controlling their own electronic reservations systems would be tremendously lower. But maybe if restaurants did it on a cooperative basis. Hmm.

Seems like it would be hard for a competitor to gain a foothold. But it might be possible:

Contact all the restaurants in a given area. Propose them a service similar to OpenTable. Guarantee to them a lower price and greater control. Market yourself as restaurant owner friendly.

Launch the service and advertise in the selected area to reduce costs.

Re: Is OpenTable Worth it?

#28

Post by waterlesscloud »

dotBen wrote: post #24
waterlesscloud wrote: post #21

Earlier quoted context omitted.

From OpenTable's info, the booking per diner is $1.00 if done via OpenTable's site, but only 25 cents per diner if done via the restaurant's site. This suggests certain approaches....

Yes, but that doesn't match what the post author says based on his figures. It could be opentable cost = booking fee per diner + setup costs + monthly fees. I'd like to know more.

His $10.40 is the cost for an "incremental" 4-top, ie a group that wouldn't have booked without coming in via opentable since they were new to the place. Given that even OpenTable's info estimates only 50% of the bookings would be incremental, and that that's likely an overestimate in OT's favor, I can imagine $10.40 may be about right.

4-top via OT = $4

1/2 4-tops from OT "incremental", cost is now $8 per incremental.

If it's really 2/5 4-tops from OT are incremental, we're at $10 per incremental.

Re: Is OpenTable Worth it?

#29

Post by sabat »

netaustin wrote: post #14

You know, Yelp should cut off its relationship with Opentable and just jump into this business itself and charge either no fee or a nominal fee to restaurants (basic vs. pro). This would solve a big problem for Yelp; if Yelp could save restaurants from the crushing cost of reservations, restaurants would be more inclined to forgive Yelp for allowing us "bored, jobless layabouts" to trash them in a public forum ( http…

The hard part for Yelp: getting computers (or, similar to OpenTable, specialized appliance PCs) into the restaurants. That's why OpenTable took so long to take off -- they had to convince a critical mass of restaurants that it was worth it.

I have mixed feelings about OpenTable. I know three people who work there, including an executive. I wish them well. I am concerned that the company's prosperity is based on value to restaurants that does not always actually exist. I, and the OP, could be wrong.

Re: Is OpenTable Worth it?

#30

Post by tkanet »

think that Groupon and clones will go through the same strugles. I just fail to understand how "discount only" cn be a business. it just mean someone is paying for the service and giving up their profits and customer relations.
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