Competing Against OpenTable - Case Study Example

Competitors will have a difficult time competing against OpenTable since OpenTable is already a well-established business with a leading supply of reservation, table management, and guest management software for restaurants. In addition to this, the company also operates OpenTable.com, which is the world’s most popular website for making restaurant reservations over the Internet. OpenTable has also grown over 14 years and has gone from just being a start-up to a successful and growing public company that boasts itself of around two-thirds of the nation’s reservation-taking restaurants as clients. Another reason is that the closest competitors such as MenuPages.com are limited in their services in that though they offer access to restaurant menus and reviews, the visitors to their site cannot make reservations and MenuPages site covers only eight U.S cities.

OpenTable has also partnered with one-time competitor Urbanspoon, enabling it to acquire Urbanspoon’s reservation management system, Rezbook, thus becoming Urbanspoon’s reservation provider. Apart from that OpenTable is committed to shrewd technological investments such as mobile Web site, and mobile applications that work on just about every Smartphone platform. It has introduced an iPad app that fully integrates with the ERB software and GPS enables mobile users to locate and make reservations at nearby venues. A new addition has also enabled users to pay for meals with a credit card directly from its apps.

Secondly, some user interfaces are difficult to use for online visitors, making them not user-friendly to any potential customer who may want to use them. Thirdly, the fact that while in the market of restaurant reservation systems online, you require a system that is web-based as compared to the one that is installed or rather upgraded on a physical machine makes it difficult for a reservation system to work.
3. OpenTable’s market is susceptible to network effects which means that the more people use it, the more utility the system delivers, which made OpenTable’s growth continually provide diners with expanded choices. More diners have thus discovered the benefits of using an online reservation system which in turn delivers value to restaurant customers and helps attract more restaurants to the network.

OpenTable adopted a business model that utilized viral marketing by encouraging dinners to invite their dinner companions to the meal. This in turn makes the email provide links back to the OpenTable Web site, which leads to the OpenTable link appearing on the restaurant’s Web site, making a direct link to the reservation page. OpenTable has also launched Facebook Connect allowing users to share their reservations on Facebook, as well as a Facebook app called Reservations, which allows partner restaurants to book reservations directly from Facebook. OpenTable has also employed its tried-and-true business model, which combines technology with old-fashioned door-to-door sales to expand to its North American markets over time.

SaaS also does not involve selling goods but instead allows diners to make reservations, just like social network sites provide services. SaaS further allows real-time access to several local restaurants and thus the ability to instantly book confirmed reservations around the clock. SaaS finally makes it easy to deal with restaurants as a single market. Read More