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OpenTable and How it Works

  • c

I have a few idle moments, today, and thus was idly wondering: How does OpenTable work? OpenTable must take a cut each time a user books / consummates a reservation through the website. Is it a flat rate cut or a percentage of how much a diner spends at the restaurant? (The latter could explain the points system, where you earn more points for dining at an expensive restaurant.) Are restaurants allowed to book all their tables over the phone, if they can, or do they have to reserve a certain number that can only be booked through OpenTable?

Speculation without basis in actual knowledge is welcome. ;)

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  1. I worked at a restaurant that used OpenTable and to my knowledge, it was a service that we, the restaurant, paid quite a bit for, and that fee was not tied at all to the number of reservations or per person spending. I don't know if it's like this for every restaurant, this was a large, high-end place. Despite this, not having OpenTable was detrimental. We switched at some point, I would say mabye in 2006, and noticed a drop in reservations. I suspect that people went into OpenTable and were unable to find us and then assumed maybe we had closed or did not have availability. I don't work there anymore so I don't know what ultimately ended up happening.

    I do know that the new system had these scary tracking abilities - to tag your reservations to what you ordered on a given evening, what you tipped etc. OpenTable, as far as I know, just tracks the number of visits, who waits on you, if you cancel etc...

    3 Replies
    1. re: LPhila

      Wowie, restaurants track what you tip and order? What has the kind of time to enter in all that info and what does that accomplish? Do they share that info with OpenTable / other restaurants?

      1. re: cimui

        I think the idea with this system was that the reservations were tied to the POS system, so it was all tracked electronically.

        I never really got what the point of all this was... maybe just your standard "knowledge is power" argument of being able to tailor the service to what the guest liked. To me, it all falls in that slightly creepy category, like when you are thanked by name by the server simply because they read it off your credit card. I'm all for having the bar where I'm a regular know my drink choice of whatever, but for me, the rest goes a little too far.

        1. re: LPhila

          I find that sort of tracking to have a high creep factor as well. Anybody who has access to the system has access to all that info. I don't want records kept on me like that.

          Back before debit cards and the now ubiquitous credit card option, I used to pay mostly by check. And I used to get obscene phone calls regularly. I did not put those two things together until I was leaving the grocery one day and heard one bag boy say to another - "Yeah, I got her phone number off the check. You want it?"

          Thereafter I started giving a fake phone number. I stopped getting obscene phone calls. Point being, all sorts of people have access to information on you, and some of those people are creepy stalkers. So nowadays I pay cash as often as possible.

    2. I use OpenTable at work, so I can explain it pretty well. If my memory serves me correctly, the restaurant pays a flat rate per person, and that rate is higher for an online reservation versus a reservation taken in person or over the phone. The high point reservations are actually for restaurants that want to fill tables at off-peak hours. I would imagine that these reservations are going to cost the restaurant significantly more than a normal reservation, which is why these are generally seen only at higher end restaurants.

      There isn't a certain number of tables that can be booked only through OT. When I make a reservation for someone over the phone, I use an interface quite similar to the one that you use online. The difference is that I can look through the whole book and decide that we can fit in another table at 7:30. So, if you look online and don't see the time slot you want, you can always call the restaurant to see if you can get a table at your desired time.

      The basic things that OT tracks are as LPhila said. We can also take notes about your reservation (birthday, anniversary, wants a booth, needs a high chair, et cetera), and also keep permanent notes on each guest (prefers a certain waiter, always gets Fiji water, VIP, etc.). When you put a comment in online, it automatically shows up in our reservation notes. Along with that information, we also see if it's your first time at the restaurant, and if you have OpenTable VIP status.

      1 Reply
      1. re: JK Grence the Cosmic Jester

        >>The high point reservations are actually for restaurants that want to fill tables at off-peak hours.

        maybe i always dine during off hours (we tend to eat late dinners), but it seems like we always get points for dining at certain restaurants. i'll have to pay more attention to that.

      2. My recollection from working with OpenTable at my last job, is that we paid .25 per person for a reservation made through one of our own links (our website, email blast, etc). We paid $1/person for a reservation made from opentable.com. Those 1,000 point reservations you see? The charge was something like $7 per person - so a reservation for 4 was $28! On top of that, I believe there was a base monthly charge for equipment rental, etc.

        It's not an inexpensive proposition. but at this point, it's tough to not have OpenTable if you're in that business.

        In our company, OT did not tie into the POS system, so it had no knowledge of what you did after you came in - no data about what you ate or how much you spent was automatically transferred. So a server might make a note that you were a big tipper or big spender, but that data didn't come from the Point of Sale system.

        And a restaurant can "block" any number of tables from online reservations, either to hold them for phone reservations (a la French Laundry), to hold them in reserve for VIPs or walk-ins, or force a seating schedule.

        Incidentally, and I thought this was interesting, data about a user is specific to a restaurant, even within a chain. If you go to one Morton's frequently, and they have lots of notes about your preferences, etc, another Morton's will not have access to that data. I believe they can do a one-time, one-way transfer of information (so if a new Morton's opens, they may get a data transfer from a nearby Morton's), but there isn't a live, combined database between any restaurants.

        10 Replies
        1. re: cyberroo

          >> Those 1,000 point reservations you see? The charge was something like $7 per person - so a reservation for 4 was $28! On top of that, I believe there was a base monthly charge for equipment rental, etc.

          nuckin' futs. can that really be worth it to the restaurant? I, for one, don't pick one reservation over another just because i get brownie points for them, redeemable for monopoly money.

          and phew. glad to hear that all the morton's in the country haven't been told about the bar brawl i started at one location, once...

          1. re: cimui

            For what it's worth, I have actually been influenced by the 1,000 point offer. I didn't pick the restaurant itself based on the offer, but I did pick the time. I had already selected that restaurant but I selected the time that gave me 1,000 points, so instead of dining at 7, I dined at 6:30 and received 1,000 points.

            And it's not monopoly money, after you accumulate 2,000 points, Opentable sends you a check for $20 (like a traveler's check), that can be used at any restaurant that uses Open Table. So, in my case, after eating twice at a restaurant I selected, at a time influenced by "points", I earned $20 towards my next meal. Not bad. And because of this I always volunteer to make reservations for my dinner club.

            1. re: mjhals

              Though I am still not sure what to do with my points, I did pick a 1,000 pt. restaurant (all times), in the UK. Made the reservations and got confirmation. Next day, I got a cancellation notice and the statement was, "if you did not cancel, you need to contact the restaurant." I made another OT reservation, and e-mailed the particular restaurant, but they have not yet responded why they cancelled the OT reservation. First time that I have ever encountered this. Maybe they did not want residents of the US dining with them?"

              Glad to know about the points. I have about 4k, but have not seen a check. Did not know to look for one... I use them to save calling all around the globe at the appropriate times to get the reservations that I want.

              Hunt

              1. re: Bill Hunt

                The dining checks don't come to you automatically. You arrange for them through your account at OT.

                Your canceled reservation was most likely an error, I'd assume.

                1. re: Caitlin McGrath

                  Yep, I thought it was sent automatically too once you reached 2,000, but you have to go into your account and request it. You also have the option of accumulating more points (ie 5,000 pts will get you a $50.00 check). It just comes in the mail in about 2-3 weeks and it looks a bit like a traveler's check (in fact I think the small print instructs the restaurant to treat it as a traveler's check for cashing purposes).

                  I thought it was a pretty good deal, to get $20 just for making reservations I would be making anyway.

                2. re: Bill Hunt

                  The only problem I have ever had with OT was in London, where the same thing happened to me (reservation being cancelled by the restaurant) twice.

                  1. re: susancinsf

                    First, thanks to Caitlin and mjhals for the clarification. Now I know.

                    SusaninSF,

                    I did e-mail the restaurant, mainly to confirm that I now had no reservation to honor, as I have made other arrangements. After three business days, they have yet to respond. I might stop by, just to inquire, but wonder what the reason was.

                    Only OT reservation that I've ever missed was one where I booked for the day before - my bad. We showed up the next night and there was no reservation. They thought for a moment, and then realized MY mistake. In a moment, they had a table for us, and had also stored the flowers (delivered the day before) in the 'fridge. I apologized, and praised them for accommodating us, especially as it was totally my error. Really nice of that restaurant, and the gratuities reflected my shame and my joy that they found a table for us, plus held the flowers.

                    Once did that on United Airlines. Was flying between PHX and DEN about every three days for a month. Just grabbed the wrong date. UAL was really cool, and swapped my ticket for the next night, for that one - no charge! Heck, I'd have been happy to get the seat and pay US$100 for my stupidity.

                    Hunt

            2. re: cyberroo

              cyberroo,

              How does opentable get all restaurants that participate on the same software?

              thanks.

                1. re: rittels

                  You get the whole reservation computer from OpenTable. If that computer gets turned off, guests can't reserve a table at your restaurant.

              1. I'm convinced that Chowhounds know everything. Y'all are so smart. =)

                Wonder whether OpenTable has helped drive up costs at restaurants. I'm sure the actual amounts paid / reservation is something restaurants have to negotiate with OpenTable on an individual basis, but it really does sound like it can get expensive. Maybe those of us who love particular mom & pop operations should make it a policy to make reservations for them over the telephone, even if it's possible to make them on OT.

                Does the restaurant pay anything for reservations that aren't consummated?

                6 Replies
                1. re: cimui

                  To play devil's advocate, it's also possible that restaurants gain by using OT (especially if they have websites with sample menus linked to OT), because people discover new places while browsing OT, and patronize them. If so, increases in business could offset the costs of using it.

                  1. re: Caitlin McGrath

                    Yes, I'm sure in some instances that's true, Caitlin! So best case scenario for a small time operation would be for it to remain listed on OT to draw in newcomers and have its loyal, repeat customers reserve over the telephone... or perhaps even better, not reserve at all and walk in.

                    1. re: cimui

                      If it's a restaurant you already patronize, you could always ask if they have prefer telephone vs. OT reservations or no reservation.

                  2. re: cimui

                    My numbers came from a large multi-concept restaurant group in LA, so if anything, they're on the low side, but I'm under the impression that those figures are pretty standardized. Recently, I have found myself wondering if the amounts have changed or if another tier has been added, as I've seen a lot of much smaller restaurants signing up.

                    No charge for reservations if guest is a no-show.

                    And overall, the benefits of OT outweigh the costs - that's why it's so popular

                    1. re: cyberroo

                      i have worked with this program for many years.

                      contrary to the above poster, my understanding is the charge is per reservation, not based on the number of people in your party. there is also no higher charge to the restaurant for the time of your reservation. the higher points to members for dining off-peak are simply incentives to fill tables likely to go empty. if you cancel, the restaurant pays a reduced rate to opentable. if you no-show, the software tracks you and punishes you after doing it twice, and the restaurant pays nothing.

                      info is not shared between restaurants and if you are required to post a cc# for a reservation guarantee, that info disappears into the ether as soon as you check in. certain high-end restaurants do have software systems that can share vip info between stores, but it's not through opentable.

                      a restaurant can choose how many tables to make available through the system, the maximum size party that can book (usually less than 6), and can also reconfigure that at any time. even same day.

                      1. re: hotoynoodle

                        Thank you for the report. Unfortunately, for most of us, OT is but a tiny piece in the dining puzzle. Most of us, who use it, do not know much, beyond just making reservations. That is all that I have used it for.

                        Appreciated,

                        Hunt

                  3. As to how and why, I cannot comment. On other OT threads, several restauranteurs have chimed in, with it's software that we buy, and then use. I do not know if OT exacts any charge for reservations.

                    From a consumer's standpoint, it's a good thing. I use it quite often and with only one little problem. I fill in the text box, and it alerts the restaurant to things like my wife's problem with bi-valves. Also, I know that some restaurants keep tabs (to what degree, I do not know) on our visits. Is this through OT? I do not know. Recently, we dined at a French restaurant in Washington DC. I'd dined there solo several times over the years, as my wife was in meetings. She'd only been able to join me on two occasions during the years. When we returned, they commented on my numerous visits, and also welcomed my wife on her third. Now, had I been doing shady stuff, this could have been trouble. As it was, my wife appreciated the acknowledgment that this was her third visit. They also knew that we were likely to do the chef's tasting menu, and that my wife could not tolerate bi-valves. That was a nice touch. Now, had I been dining there with someone else, it could have gotten "stickey," but we appreciated it. I attribute this to both OT and to the restaurant's files on patrons, even if they live 2000 miles away!

                    Hunt

                    2 Replies
                    1. re: Bill Hunt

                      there is a section for "notes" where the restaurant can maintain info about you. well-managed places, like the one you mention, use this function to really personalize dining experiences.

                      it's a great tool for business and patrons.

                      supposedly gangsters always had a rule of not taking wives and girlfriends to the same restaurants. avoiding the stickiness you mention! lol.

                      1. re: hotoynoodle

                        Yes, I am glad that I am "true." Some years back, I was attending a vintner's dinner with Brian Del Bondio, of Markham. My wife could not attend, so I took a "date," a mutual friend, and Brian walked up and whispered, "where is your lovely wife?" I then introduced him to my "date." Next vintner's dinner with him, I had my wife in tow. Now, he's in Napa, and we're in Phoenix, and he picked up on it in a heartbeat. One must be very careful, and respect their spouse... or pay the consequences! Honestly, if I wished to "run around" on my wife, I'd better do it in Indonesia, or similar. I certainly would be in trouble in the US, all of the UK and most of Europe. I can't even go to the island of Lana`i in Hawai`i, and not have her run into people that know her.

                        No, I'd expect most OT restaurants to have her on their list, even though she'd never made a single reservation. I guess the the gangstes had it pegged.

                        Hunt