1. The document discusses OpenTable, the leading online restaurant reservation platform, and analyzes its external environment, internal strengths, and competitive position.
2. It recommends that OpenTable create a positive same-side network effect on the diner side by introducing new payment and social features like bill splitting to foster a community of repeat diners.
3. This would help defend against threats from other reservation platforms and one-way reservation sites by increasing diner loyalty and engagement with OpenTable.
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OpenTable Competitive Strategy Analysis
1. Agenda
1. Introduction to OpenTable
2. Value Proposition of Online Restaurant Reservation
3. External Analysis
4. Internal Analysis
5. Recommendation
2. First-mover in Restaurant Reservation Industry (RRI)
Launched 1999 in San Francisco and Chicago
Invented Electronic Reservation Book
Leader in the US with roughly 32,000 restaurants &
158 million customers seated (2013)
Revenue Model
Subscription fees ($244 average)
Reservation fee per customer seated ($0.25-$7.50)
3. Restaurant Reservation Value Proposition
Perishable inventory – an empty table is a lost opportunity
Customer accessibility – reduce reservation friction
Customer loyalty – know and reward their customers
Business & marketing acumen – restauranteurs love food, not business
4. The Restaurant Reservation Industry
Platforms
OpenTable, Yelp,
La Fourchette
One-Way Reservation
uReserv, Eveve,
rGuest
Two very
different
models.
6. Attractiveness of the RRI
PROS
No clear global leader
Low barriers to entry in underserved
areas
Tendency towards convenience &
technology
53% US of diners never made
reservation online
CONS
Complexity of the industry
Growing competition
Threat of envelopment is high
Dominance of large platforms due to
strong cross-side network effects
Medium Level of Attractiveness
7. OpenTable
Full ERB, Connect, Guest
Center
Restaurants
Restaurant’s Own Website
Other Platforms
Yelp, LaFourchette
OpenTable
Diner sourcing to OpenTable
Diner sourcing to competitor ERBs
Diners
Platforms
One-Way
ERBs
Other Platform ERBs
Yelp, LaFourchette
One-Way Reservation
uReserv, Eveve, rGuest
Where OpenTable Competes
10. Is this Competitive Advantage Sustainable?
Threat from Platforms Threat from One-Way ERBs
Dent in the partnership
model
Strong cross-side network
effects
Ability to exert diner pull
Promote change in diner
behaviour
No marketing
responsibility
LOWER PRICES
12. OpenTable Payments
Better positioned compared to competitors (PayPal, Cover, MyCheck)
Seamless Integration between ERB, POS, Mobile App
Skip verification step (time-savings)
13. OpenTable Payments: Roll Out
Integration with more POS systems
Lowering subscription fees to match competitors
ERB IS CENTRAL FOR SUCCESS OF MOBILE PAYMENTS
14. How Does It Create Positive Same-Side Effects?
Popoff
LaBarge
Hussein
Nelson
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