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March 30, 2012

The evolving world of online restaurant reservations

Sharon Harris-Zlotnick

As advancing technology replaces traditional telecommunications with online connectivity, phone reservations may become passé in the future. Can you imagine that something as common as calling for restaurant reservations could soon be “so “yesterday”?

Today online reservations technology opportunities abound. The future of reservations is being studied by Professor Sheryl Kimes of Cornell University and Katherine Kies who conducted an online research study of 472 consumers in 2011 titled The Role of Multi-Restaurant Reservation Sites in Restaurant Distribution Management. The survey should help restaurateurs evaluate the value of an online system.

Their research revealed that among U.S. adults, 55 percent had used an online service, up 24 percent from 2010; 95 percent reserved by phone, 48.5 percent utilized a restaurant’s individual website, 30 percent reserved through a multi-restaurant site, with another 16.5 percent using that site’s mobile app. The dining public has not yet completely embraced Internet reservations, but the numbers are growing.

Online reservations are typically free to dining customers; restaurants usually pay a flat monthly fee and possibly a per-diner charge. Savvy operators should do the math before contracting a service. Most offer similar software capabilities, so pricing, service and network could make the difference.

In the U.S., currently dominates, but several alternative systems have launched their own programs. Established in San Francisco in 1998, OpenTable’s purpose was to expedite reservations using specific times, date, cuisine and pricing criteria. A rewards program allows consumers to accumulate points for future dining discounts after achieving specific point levels.

Listed on the NASDAQ, OpenTable contracts with over 25,000 restaurant locations in most U.S. states, plus Canada, Germany, Japan and Mexico. OpenTable also operates Continue Reading…