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You sound pretty convinced. But it is almost never the case that a product or service is insulated from competition. And I completely disagree that for competi

You sound pretty convinced. But it is almost never the case that a product or service is insulated from competition. And I completely disagree that for competitors to emerge they MUST do everything that OpenTable does. They only have to offer a couple of features that OpenTable doesn't. Or do one thing better or cheaper.

potatolicious 12y ago
All of OpenTable's features are core competencies of a restaurant. A restaurant must do CRM, it must maintain analytics about its own performance, it must be able to manage tables and keep track of payments, and unless you're a no-reservations place, it must have a system in place to handle reservations. If you don't cover all of the above bases as a competitor, you're leaving your customers to cobble these pieces together themselves. Maximum freedom? Sure, but how many takers do you think you'll have? "Hey Mr. Restaurant Owner, I understand you have a substandard but perfectly functional system that runs every major concern of your restaurant. Your employees kind of hate it, but they're extremely proficient at using it since it's the industry standard. Boy do I have a great idea for you! You should throw this system away so you can assemble multiple pieces of software from multiple vendors together to do the same thing, in a field where interoperability isn't even in the vocabulary! How your payments system talks to your CRM system? Fuck knows. But you should do this!" OpenTable isn't completely immune from competition, but they're pretty much as close as any software company can get. There's a reason why every potential competitor to OpenTable has taken the "full restaurant management system" angle. OpenTable is vulnerable if someone can execute on the kitchen-sink restaurant management system better and more cheaply. I don't think it's vulnerable to piecemeal replacement.
- vidarh 12y ago
  The vast majority of restaurants don't have a unified system to do this today. Where the company I work for has gone in, it's usually been the first step towards a unified restaurant CRM solution they've taken. It's rare for us to start talking to a client that tells us they already have a CRM solution in place. It is somewhat more common for us to come across restaurants that use services like OpenTable and competitors only as a source of bookings. > Your employees kind of hate it, but they're extremely proficient at using it since it's the industry standard. The thing is, it's not the industry standard. It may be by far the largest, but it serves a tiny portion of the industry. According to the press release, they serve 31,000 restaurants worldwide. There are more than 400,000 restaurants in the US, of which more than 200,000 are "full service" restaurants. Most of these are still "unexplored territory" where there's either little to no IT investment (the small operators) or a patchwork of custom/partial solutions, often bolted onto the till-system with no central CRM solution (the larger operators)
- frogpelt 12y ago
  Look at how Square attacked the POS market. They didn't start by trying to replicate everything existing POS systems were doing. They started by appealing to small shops who were not using full scale POS systems. It may appear now that OpenTable has a death grip on the market but it only takes a slight shift in ideology for opportunities to emerge.

potatolicious 12y ago

All of OpenTable's features are core competencies of a restaurant. A restaurant must do CRM, it must maintain analytics about its own performance, it must be able to manage tables and keep track of payments, and unless you're a no-reservations place, it must have a system in place to handle reservations. If you don't cover all of the above bases as a competitor, you're leaving your customers to cobble these pieces together themselves. Maximum freedom? Sure, but how many takers do you think you'll have? "Hey Mr. Restaurant Owner, I understand you have a substandard but perfectly functional system that runs every major concern of your restaurant. Your employees kind of hate it, but they're extremely proficient at using it since it's the industry standard. Boy do I have a great idea for you! You should throw this system away so you can assemble multiple pieces of software from multiple vendors together to do the same thing, in a field where interoperability isn't even in the vocabulary! How your payments system talks to your CRM system? Fuck knows. But you should do this!" OpenTable isn't completely immune from competition, but they're pretty much as close as any software company can get. There's a reason why every potential competitor to OpenTable has taken the "full restaurant management system" angle. OpenTable is vulnerable if someone can execute on the kitchen-sink restaurant management system better and more cheaply. I don't think it's vulnerable to piecemeal replacement.

vidarh 12y ago
The vast majority of restaurants don't have a unified system to do this today. Where the company I work for has gone in, it's usually been the first step towards a unified restaurant CRM solution they've taken. It's rare for us to start talking to a client that tells us they already have a CRM solution in place. It is somewhat more common for us to come across restaurants that use services like OpenTable and competitors only as a source of bookings. > Your employees kind of hate it, but they're extremely proficient at using it since it's the industry standard. The thing is, it's not the industry standard. It may be by far the largest, but it serves a tiny portion of the industry. According to the press release, they serve 31,000 restaurants worldwide. There are more than 400,000 restaurants in the US, of which more than 200,000 are "full service" restaurants. Most of these are still "unexplored territory" where there's either little to no IT investment (the small operators) or a patchwork of custom/partial solutions, often bolted onto the till-system with no central CRM solution (the larger operators)
frogpelt 12y ago
Look at how Square attacked the POS market. They didn't start by trying to replicate everything existing POS systems were doing. They started by appealing to small shops who were not using full scale POS systems. It may appear now that OpenTable has a death grip on the market but it only takes a slight shift in ideology for opportunities to emerge.