CH9

Case Study

1.       Why have OpenTable competitors had a difficult time competing against OpenTable?

Opentable has a large number of restaurants already participating with them. They also have software that many companies like and is easy for consumers too. OpenTable has the ability to track consumers and help diners get the data they need for to help them grow. The company has more options than their competitors and that makes them more desirable.

2.       What characteristics of the restaurant market make it difficult for a reservation system to work?

The restaurant market is difficult because it was, and continues to be highly fragmented, and local – made up of more than 30,000 small, independent businesses or local restaurant owning groups.

3.       How did OpenTable change its marketing strategy to succeed?

OpenTable’s strategy included paying online restaurant reviewers for links to the OpenTable web site and targeting national chains for fast expansion. They retool its software and hardware to create a user friendly ERB system. OpenTable also created a user-friendly Electronic Reservation Book (ERB) and they deploy a door-to-door sales force to attract subscription from high-end restaurants, this combination of e-commerce, useful and friendly technology really worked for them. The company was able to grow its customer base. OpenTable developed many programs to help publicize the service through “e-invites”, satisfied customers, and social media. 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. Also, OpenTable offers 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.

4.       Why would restaurants find the SaaS model very attractive?

Restaurants like the SaaS model attractive because customers don’t buy software and install it on their computers, but instead go online and get the software functionally through subscriptions. They also don’t sell goods, but instead enables diners to make reservations, like social networking sites provide services. The Saas model can add efficiency and cost savings for the both the vendor and customer. Customers save time and money since they do not have to install and maintain programs. The customers do not have to hire staff, or use existing staff to maintain the software. They also generally do not have to buy any new hardware. This allows a customer to focus more resources on growing the business

Projects

1         Find an example not mentioned in the text of each of the four types of online retailing business models. Prepare a short report describing each firm and why it is an example of the particular business model.

For a manufacture direct I thought of Riedell who basically only manufacture different types of figure skating skates. For a catalogue merchant I thought of Yonkers because my mom always gets their catalogues in the mail. A good example of a multi-channel merchant or brick and click store is BestBuy. BestBuy does a good job of leveraging their strengths and assets as they advertise their line of electronics and entertainment offerings in technical media, social media, and printed media. They provide their customers with good recommendations based on user’s web behavior and also offers discounts on various products. A great example of a virtual merchant is Joss & Main with their only presence being online. They have developed a quite well known and respected brand in the furniture industry. The main focus of Joss & Main is provide good looking and well-functioning furniture at a low cost along with good customer service.

2         Drawing on material in the chapter and your own research, prepare a short paper describing your views on the major social and legal issues facing online retailers.

As the world is moving towards more globalization by every second, and a with technology being a big part of why globalization is possible I think that some of the main trends we will see in the upcoming years are developments in the software of tracking and trading goods on global shipping routes. Blockchain is the new buzzword in the IT and supply chain industry. With Maersk’s new project on Blockchain together with IBM will show many unused opportunities in global trading that will affect e-commerce greatly.