Opentable Case

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1.Why will OpenTable competitors have a difficult time competing against OpenTable? OpenTable competitors will have a difficult time competing against OpenTable for several reasons. OpenTable’s market share is large, “with more than 26,000 restaurants subscribing to the service” (Caro, 2012). This represents a growth of 35 percent over the previous year. About “44 percent of North American restaurants that take reservations are signed onto OpenTable, and about 12 percent of diners seated with reservations at any North American restaurants made those arrangements through Open Table” (Caro, 2012). In other words, OpenTable has done a great job of capturing and owning the market. OpenTable has been innovative, offering a service to restaurants…show more content…
This strategy was not financially stable. As a result, the company changed its strategy, making management changes, most prominently placing “investor and board member Thomas Layton, founder of, as OpenTable’s CEO” (Laudon, Guercio Traver, 2012). Layton worked to reduce staff, shut down marketing efforts, and limit company activities to Chicago, New York, San Francisco, and Washington, D.C. OpenTable also created a user-friendly Electronic Reservation Book (ERB) and began using a door-to-door sales force targeting high-end restaurants to become subscribers. As a result, the company was able to grow its customer base, upgrade its management team, and go from “spending $1 million a month and bringing in only $100,000 in revenue” (Laudon, Guercio Traver, 2012) to launching a successful initial public offering. OpenTable developed many programs to help publicize the service through “e-invites”, satisfied customers, and social media. Since its inception, OpenTable has “seated more than 395 million diners around the world” (PRNewswire, 2013). This gives the company ongoing traction to succeed, which is a much stronger marketing strategy than relying upon online restaurant reviewers. OpenTable now uses the diners it seats as reviewers, following up with each reservation via e-mail to ask the diner to review the restaurant for other diners. In addition, OpenTable is now able to offer mobile support through a mobile Web site and mobile applications to help users find restaurants with the help of GPS as well as book reservations. These changes, some dramatic, others by-products of growth and a polishing of their offer, have allowed OpenTable to

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