Restaurants to Target Younger Diners Through Online Reservation Systems

As consumers spend more time online for everything from watching their favorite TV shows to ordering shoes, businesses of all kinds are boosting their online profiles. This is especially true for restaurants. In addition to developing their own websites, they are paying for listings on online multi-​restaurant reservation sites. This investment is proving important for attracting younger diners.

Most restaurants operate on a razor-​thin margin so added marketing expenses are carefully scrutinized. Cornell University research shows that restaurants which use a multi-​site reservation system such as OpenTable spend up to $270 a month in fixed costs plus an additional $1 for every seated diner. Another popular alternative, UrbanspoonRez, charges $99 a month plus $1 for each seated diner. Currently, about 32% of all consumers are using multi-​restaurants sites for reservations. The heavy users of these sites are between the ages of 18–34 (49.5%). Residents of urban areas (24.5%) or small towns (25.6%) are more likely to use these sites than rural residents (20.8%). To date, 54% of consumers have made online reservations and half of the users connected with a multi-​restaurant site, a statistic that speaks to their growing popularity.

For restaurants, these sites offer improved reservation management. But restaurant owners worry that, over time, consumers will become more loyal to the service provider than the restaurant as the service provider may offer rewards points. Part of the appeal of these systems, from a customer’s point of view, is access to guest reviews. And the Cornell research proved that detail to be important. However, the research also shows that consumers appreciate the ability to make online reservations – whether through a restaurant’s own site or a multi-​restaurant site. Researchers encourage restaurant owners to improve their own online reservation systems if they eschew the multi-​restaurant sites. Otherwise, they should join these sites and consider the expense to be a marketing cost that will connect them with consumers who dine out more frequently than average.

[Source: Kimes and Kies. Role of Multi-​Restaurant Reservation Sites. Hotelschool​.cornell​.edu. January 2012. Web. 27 Feb. 2012] 
Kathy Crosett
Kathy is the Vice President of Research for SalesFuel. She holds a Masters in Business Administration from the University of Vermont and oversees a staff of researchers, writers and content providers for SalesFuel. Previously, she was co-​owner of several small businesses in the health care services sector.