Is OpenTable Worth It?

Is OpenTable worth it? :

We've often been asked why Incanto is not listed on OpenTable.com. For those of you not familiar with the service, OpenTable is the most successful online restaurant reservation portal on Earth; a place on the Web where diners can search for and make reservations at leading restaurants, via a browser or smartphone. Restaurants like Incanto that chose not to offer their seats through OpenTable find themselves in a shrinking minority.

Let me start by stating the obvious: the convenience and immediacy of booking a table online anytime day or night is beneficial to both diners and to restaurants. This was my belief nine years ago, when we first approached OpenTable to inquire about becoming one of its early customers. It's also why we have found a way to offer Web-based reservations, through our own website, since we opened and why we've kept current and revisited OpenTable's offerings each year, to re-visit our decision.

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Comments

[JMLcommunications]

06:44 PM on 11/15/2010

As the the Concept Developer and Managing Partner of one of the most popular restaurants in the country, I thought I would offer some insight and true-life case study experience to respond to Mark Pastore’s article about OpenTable. In short, we learned how to make the software work for us at Founding Farmers. Yes, there are still challenges and the onus remains on the restaurateur to learn the system, but we embraced it, and saw our sales increase 15% at our already #1 booked restaurant in the country (through OpenTable) and #1 for the last 8 months in the greater Washington, DC region.
Mark Pastore’s article questions the true value of OpenTable to the restaurateur, whom he says spends more money on the system than it is “actually worth.” After time and focus on the issues, we have found the most important ingredient to OpenTable’s recipe: the software.
To be fair, the price of OpenTable assumes you will use the robust software that can be overwhelming in a world of user-friendliness. OpenTable is growing faster than the company can keep up with, thus unable to provide customer service to get 100% utilization of their product. At Founding Farmers, the meat of the burger is in the analytics; functions we were intimidated by but now embrace, even with our average monthly OpenTable bill of $6,000. Full story here: http://bit.ly/b7SW8c, to see how we used OpenTable to change our loathing of it, to benefit from it.

[thesidetrek]

09:27 AM on 10/22/2010

Interesting perspective from restaurateurs who feel the need to pay for OpenTable. As a diner, I've returned to calling the restaurant directly to get a preferred time at a top spot. When OpenTable shows no availability, I can frequently get in by calling. They do like to hear our voices.

[BlueZoo]

04:51 PM on 10/20/2010

I take issue with that 5% profit figure. Granted, if a table of four only eats at a gourmet restaurant, then I see where belonging to Open Table doesn't justify paying for the listing; however, if alcohol is consumed, the balance overwhelmingly favors the restaurant and its profit margin! Alcohol is at the very least sold at a 100% profit and, in many of these upmarket restaurants, the margin is far higher.

[Ramart]

02:00 PM on 10/20/2010

If OpenTable has now trapped restaurants into participating at a high cost, it's largely restaurants' own faults. OT seems to have become popular in large part because many restaurants were hard to reach via phone or were rude when they could be reached or treated would-be reservers like idiots by routinely telling them only 6pm or 10pm was available (even though the place would be half-empty at 8pm), etc. Many reservation takers at momentarily hot, "of-the-moment" restaurants seem totally untrained and without a clue about customer service or human relations; their often-snarky attitudes reflect a mindset that they're doing callers a big favor by even considering their laughable requests for a table booking. Website like OT=no snark, table availability, other restaurant options.

[mellene]

11:04 AM on 10/20/2010

While I've used Open Table since it first began, I'm not a fan of the fees that restaurants have to pay as cited in the SFGate article. I would happily pay a "fee" when I paid my bill at the restaurant as having been able to use the convenience of Open Table to make a reservation. I see it the same way as I do "fees" for checking my baggage on an airline. I'm really paying for the convenience and service I was provided.

[SwingingFromCenter]

07:10 PM on 10/20/2010

And that would be the end of Opentable, right there.

Why? Because the vast majority of restaurants don't require reservations. You just walk in and get a seat. If there was a fee on my end to use OT, I would simply stop using it. The beauty of OT for restaurants that I don't need a reservation to get into (McCormick and Schmick's, for example) is that it locks me in to stop by, because I'm going to get points for showing up, and I've made a determination to go there.

Without a reservation, sure maybe we'll start off heading towards M&S, but perhaps we'll get to the area and decide that we'd rather get a steak from Ruth's Chris instead.

[K Wendel]

12:02 AM on 10/20/2010

Iron Chef Michael Symon is closing one of his Cleveland restaurants as of Oct. 30...so sad...Bar Symon..here's the link: http://www.wkyc.com/news/local/news_article.aspx?storyid=154154&catid=45

[SwingingFromCenter]

05:48 PM on 10/19/2010

From a consumer standpoint, OT is great. The reality is, that's all I care about. I'm not interested in the economics of running a restaurant or your overhead. I'm interested in a convenient and satisfying dining experience. If OT is cutting into your profits so much, raise your prices and take your chances as to whether people will accept the increases or go to other restaurants.

I will say this: OT has exposed me to a LOT of restaurants I would have otherwise never found. Up here in Seattle, you can't swing a dead cat without finding 15 gourmet restaurants. And since it's such a large area, many of them you would never see if you weren't aware of them in advance. So on that front, OT has gotten me into the doors of a lot of places I would have otherwise not gone. You take the good with the bad.

[flamenco]

03:34 PM on 10/19/2010

Wow, great article. Extremely well-balanced and nuanced. Open Table has not gained traction in my small city, but I've seen how it looms large in big cities. But I was not aware of just how entrenched they have become, nor did I know how much pressure restaurants feel to use it.

I came away believing that OT really does have them by the cojones, and that it's too strong. It's tough enough business to be in as it is. I'm sure OT has plenty of glib arguments for how much value they provide, but a monopoly isn't a good idea, whether it's Microsoft, Apple, or OT.

As a web developer, I can see how little informed restaurants are, even the best ones, with the requisite Flash-based silliness they often end up with. It's understandable, their expertise is not in the web. Sadly, this makes them ripe for the plucking.