Is OpenTable Slowly Dying?

It revolutionized online reservations, but faces threats
By Elizabeth Armstrong Moore,  Newser Staff
Posted Sep 2, 2017 2:41 PM CDT
OpenTable's Future Uncertain Amid Competition, Complaints
In this Tuesday, May 26, 2015 photo, communal tables are filled with ticketed diners at the Lazy Bear restaurant in San Francisco. Lazy Bear asks diners to pay up front for their meals much the way theater patrons pay for their seats. The tickets can be transferred but not refunded.   (AP Photo/Eric Risberg)

It's been almost 20 years since OpenTable launched in 1998. Now seating more than 23 million diners a month in 43,000 restaurants worldwide, it's still a force to be reckoned with, but the New York Times details the company's recent devaluation and other woes, and calls it a "power under siege." That's not just because an entire generation of competitors is nipping at its heels, but because, even all taken together, two-thirds of reservations are still made by phone—at least according to Yelp, once a partner of OpenTable's but now a rival. For one, some people prefer to talk to a real person and always will. "My desire to speak to a human transcends the need to just make a reservation," a marketing executive says.

Then there's the issue of fees; OpenTable charges restaurants $1 per person in a reservation, plus hundreds in monthly fees. "OpenTable was charging me for customers I already had and knew well," the proprietor of Dosa in California says, adding that he paid up to $50,000 in fees not counting the monthly fee. OpenTable's competition is getting certain details right, like Resy (which boasts 1,000 restaurants in 80 cities across the US) introducing wait lists to bring no-shows from 15% to under 4%. There's also the one-size-doesn't-fit-all issue, because high-, middle- and low-priced restaurants can have dramatically different needs. Will OpenTable survive? All we know for now is that Priceline bought OpenTable for $2.6 billion in 2014, but has since written off $941 million of its value. (More OpenTable stories.)

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