Intensive SWOT Analysis of OpenTable as a Best Restaurant Booking System

According to the OpenTable press report 2018, it has got on board more than 28 million diners per month via online reservations across more than 51,000 restaurants.

But how did OpenTable achieve such widespread success?

It accomplished the tough part of getting into 80 cities across 20 countries, to which OpenTable reciprocated by creating a user-friendly Electronic Reservation Book service and selling it through a door-to-door sales force that initially only targeted expensive restaurants.

The strategy worked for OpenTable and it spread across 50 states and over 1,000 restaurants even to faraway places.

And the results speak for themselves: OpenTable's reach extends across all 50 states, encompassing over 1,000 restaurants, even in the most remote corners.

Now, fueled by its proprietary Electronic Reservation Book Software, OpenTable aims to deliver top-notch features.
 

Opentable Offers the Following Dining Solutions

• It has got a real-time map integrated that shows free tables on each restaurant floor. This, in turn, makes the management of the floor easy.
• It keeps a specific meal pattern for all parties. It helps maximize the guest seating by optimizing the maximum space.
• It saves a hefty amount of time for both the restaurateurs and the customers with its online reservation system.
• It stores all the data of the diners and gauges their pattern of frequency. This is how they manage the list of their loyal customers.
• It provides the restaurateurs with the reviews written by their customers.
• It attracts repeat customers with email marketing.
• It offers a loyalty system to the customers so that they can avail of benefits through the points they have accumulated.
   

Revenue Model of OpenTable

• A one-time $600 – $700 fee for onsite installation, training, and support.
• A monthly fee of $199 is charged by OpenTable from the restaurateurs for the hardware and the software.
• A reservation fee of $1.00 per guest is charged when the reservation is made with the help of the OpenTable platform.
• A reservation fee of $0.25 per guest is charged when the reservation is made through the restaurant’s platform with the help of the OpenTable platform.

The Comprehensive Business Model of OpenTable Similar Platform:

Get to know the work model of OpenTable's business model and similar platforms. 

Let us summarize it into a quick SWOT analysis to understand the strategies driving their success in a competitive market.

Strength

OpenTable struggled to get its initial public offering priced, but the stock has since appreciated considerably, making takeovers expensive.

However, recognizing the convenience it offered, both diners and restaurateurs quickly accepted the platform, leading to rapid expansion and numerous acquisitions.

1. OpenTable made a quick yet strategic expansion:

From its humble beginnings in major US cities, OpenTable expanded globally, targeting countries with avid diners. This way OpenTable went on its journey to acquire more and more restaurants and ultimately became so big, that it even took over many small fishes in the pond, working for the same purpose and eventually became the whale itself.
 

2. OpenTable operates a mobile service: 

The digital world you can say it!

The most compelling part about OpenTable is that it has developed an iOS app and an Android app, and it also runs on Blackberry devices along with a well-designed website.

This gives the platform a larger pool of audience who use different types of devices.

3. OpenTable serves as a platform that has multiple suite of tools: 

The business model of OpenTable is planned in such a way that it has almost everything that encircles the vicinity of the online table reservation system.

and still counting……..

Phew!

These were the features on the application that provide ease of booking as well as ease of management like no application that exists today does and makes it the best restaurant booking system.

4. OpenTable revenue model: 

If you look closely at the revenue model of OpenTable, all that you will see is, that they are set in ascending order of their idea of generating revenue.

• OpenTable earns the maximum with the help of the monthly subscription plans.
• The second most remunerative revenue-generating model for OpenTable is the revenue obtained by the reservation. 
• Next, the installations and training work well for the platform
• And a little or less is obtained by the advertisements.

You see, here it has got all the three sure-fire methods to make money and so it does not have to rely on advertisements and suffer from any downfall.

OpenTable grew more by word-of-mouth marketing.

When OpenTable was once just a seed, it nourished its roots by fostering viral marketing instances. The most effective form of OpenTable’s marketing form was simple:

Entice the diners in such a way that when they find the platform’s service helpful, they recommend it to their peers, thereby creating an unstoppable chain of the most reliable marketing strategy – word-of-mouth marketing.

Weakness

1. OpenTable does not grade restaurants

It is not the OpenTable that grades restaurants, it is the customers that do it. Now, these customers can be the internal members of the restaurants and so will speak highly about the restaurant.

In such cases, it is really risky for the portal to show a five-star rating on the portal and in reality, it is not even worth a single star. The customers can lose the respect they have for the portal and can decide to uprightly quit it while transitioning to a more trustworthy portal.

1. Relatively expensive for smaller restaurants

The openTable system is relatively expensive for smaller restaurants where profit margins are relatively slim, approximately 5–7 %

Though OpenTable has a wide and far reach in various cities, in various countries, in some places, and in restaurants, its growth opportunities should be underestimated. This is because not all the restaurants are in the center of the city or the venues of the restaurants are not all where the customers can reach easily or with a little brouhaha.

On the other hand, the larger restaurants can pay for a subscription and every other plan that OpenTable launches considering the big amount they charge from the diners.

On the same page, when we talk about the smaller restaurants, they don’t charge a big amount and when due to the competition register themselves to the portal, they suffer a lot since their profit margins are relatively slim.

Opportunities

1. Launching an app for mobile devices:

As discussed above, the secret ingredient to OpenTable’s expansion is undoubtedly mobile applications.

Pertaining to the technological advances in the world of devices, Mobile & Tablets, IoTs, and wearables can serve as the future of the industry.

Thus, developing the applications for those devices can help OpenTable step way forward from where its competitors are. Expansion is possible through applications for tablets and mobiles.

1. Expansion in various countries:

The most obvious form of an opportunity for OpenTable can be in the form of expansion to other countries and targeting major cities.

Threats

1. Cut-throat competition

Many sites more usefully assess restaurants. Call it Yelp, or call it ChowHound, OpenTable is overshadowed by these sites considering various factors in mind.

One of those factors can be that Yelp provides the reviews and ratings open for all the restaurants to view.
OpenTable doesn’t.

This is a big turn-off for the restaurants who seek genuine reviews and even the customers feel cheated when their honest reviews of criticism are not published by the platform.
 

1. Competition from Search engines, online Yellow Pages, and travel agencies

Though not trendy, there still are some of the genuine ways to find restaurants. The directories provide the number of the restaurants, and though not with a single tap, they sure do help in getting a reservation.

As OpenTable strengthens its strengths, works on its weaknesses, seizes its opportunities, and confronts its threats, it remains steadfast in its mission to revolutionize the dining experience, focusing on innovation and excellence at every reservation.

Quick Takeaway

This was a comprehensive study of OpenTable as the best restaurant booking business by weighing all the factors that make up a big platform called OpenTable.