OpenTable Payments is a Big Data Game Changer

OpenTable announced today that they are expanding their mobile payment functionality roll-out.

But most of the buzz around the announcement is about the payment processing and diner convenience. Those are both fine benefits of the functionality, but it’s missing the big picture. “Pay with OpenTable,” as the feature is called, has given OpenTable the ability to link directly into restaurants’ point-of-sale (POS) system. With POS data, OpenTable gives restaurants small and large the ability to leverage Big Data for big profits.

OpenTable’s Real Power (Now)

To diners, OpenTable makes it easy to make a reservation – via the web or smartphone apps. Unsophisticated restaurants also use OpenTable to manage their reservations – they can more easily accept and manage reservations without worrying about accepting too few or too many reservations relative to their capacity (number of tables and chairs in the dining room).

Sophisticated restaurants on the other hand recognize OpenTable’s real value: they not only know HOW MANY diners will be coming in on future days / times, they also know WHICH diners will be coming in.

“Pay with OpenTable” Will Supercharge Restaurant Sales

OpenTable explains explicitly that with the “Pay with OpenTable” functionality, diners’ POS details will be pulled into OpenTable for diners to review and pay via their smartphones, and servers will be able to process diners’ payments through OpenTable and / or the normal POS.

Combined with the old OpenTable power of knowing WHICH diners will be dining in the future, the line item details (e.g. what drinks, entrees have been ordered) of what diners have ordered in the past give restaurants opportunities to maximize revenue like never before.

Imagine this:

  • I use OpenTable make a reservation at RestaurantX, and proceed to eat at RestaurantX and pay through OpenTable’s mobile app.
  • A month later I make a reservation at RestaurantX again. This time, when I show up for my meal, the server at RestaurantX takes a quick look at my OpenTable profile and history and sees that last time I ordered a low priced glass of pinot noir. With this information, the server approaches my table and says “Good evening, Mr. Maher, can I interest you in our best pinot noir?”
  • The moment that I sit down, the restaurant is up-selling me, and the server is making me feel like a VIP by greeting me by name and knowing what I like.


Taking OpenTable Big Data to the Next Level

Restaurants can also take this combination of knowing WHICH diners have made reservations and their detailed order histories to an even more aggressive profit driving level.

Imagine this:

  • The manager of RestaurantX  logs into OpenTable to see that next Tuesday night is already completely booked. The manager then adjusts her staff schedule to make sure that there will be extra servers, bartenders, cooks, etc. working that night to keep up with the rush.
  • The manager also notices that the weighted average revenue per person for everyone with a reservation for next Tuesday night is significantly below the RestaurantX’s normal target. The manager can deduce that next Tuesday night’s diners are going to be a bunch of cheapos so she sets the specials-of-the-night to be great value (perhaps as opposed to the more luxurious specials that she typically uses on a Friday night).
  • The manager also notices that the 3 most popular items ordered by those with reservations for next Tuesday were all salads, and that the 3 least popular items ordered were all steak entrees. So the manager adjusts her ingredient purchases and inventories to reduce food waste.
  • Finally the manager notices that the diners with reservations for next Tuesday have historically showed up for their reservations on average 5 minutes late, but have eaten quickly turning tables in less than RestaurantX’s normal average. This allows the manager to prepare the staff for a late night with lots of turns.

In Summary

OpenTable has long simplified the diner reservation making process and the restaurant capacity planning process, but with “Pay with OpenTable,” now restaurants can really take advantage of big data by making customers feel like VIPs – driving up average tickets. Furthermore, restaurants can get even more sophisticated to optimize all of their costs and strategies.

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