Many of the large restaurant online booking systems currently available throughout the world push the concept of their large customer base, the marketing exposure that they can bring to your restaurant through their network and marketing and promotion activities they will undertake for the benefit of your restaurant.
These are compelling claims that would appeal to any restaurant owner or manager and, especially so, to a restaurant that has empty seats or is struggling financially. After all, restaurants are designed to welcome and accept customers, every restaurant wants more customers. However, like anything else, one needs to look behind the scenes to find the real outcomes of these claims.
What advertising and promotions do these large booking companies do for restaurants?
In many cases, the advertising these large booking companies undertake, is primarily the purchase of “AdWords” or similar of your restaurants exact business name. By doing this, if a diner undertakes a Google search or similar, the booking platforms AdWord advertisement appears before your google restaurant listing. Very simply and clearly, this is not to bring extra customers to your restaurant but serves to hijack a customer who is specifically looking for your restaurant and take them into their system. The reasons for this are very clear:
- They want to hijack your customer and have the booking made through their system so that they can charge you their higher booking fee, which for a booking for 4 people that could be AUD$12.00. This is a very profitable exercise for them as the Adword would have cost them significantly less. Some people refer to this practice “Arbitrage”. The reality however, of what has occurred however, was not just “arbitrage” but to “steal” what should have rightly been your customer and revenue.
- By hijacking your customer through their “Adword” and equivalent practices, they are also trying to teach your customers that the best place to make bookings for your restaurant is through their website and not your website, and that any future bookings between that customer and your restaurant should be through their website. Such an outcome would mean that these booking platforms would permanently steal that customer and ensure that all future bookings made with your restaurant also attract the higher per diner charge and the booking relationship remained between them and the customer.
To avoid these issues, if you decide to use one of these large booking platforms, read their terms and conditions and consider requesting them to delete their ability to purchase “Adwords” and equivalent marketing from any contract for the use of their booking systems
Why do these large booking companies all have loyalty programs and who funds them?
Again, very clearly, most of the large booking companies that charge for bookings coming through their website operate loyalty and rewards programs to try and incentivise your customers make bookings through their platforms than through your own restaurant website. The reasons they do this include:
- If a customer has greater loyalty to the booking platform that your restaurant, then your restaurant will always have to pay them the higher per diner charge. It certainly is not done to help your restaurant.
- These loyalty programs in many cases being funded by your competitors in an effort to take your customers away from you. This occurs as these large booking systems target restaurants that are not performing well to offer discounts on their websites, such as 50% off. It is these discounts that are then marketed by these online booking companies through their platforms to attract customers to their platforms. These reduced prices being offered by restaurants, are then promoted by booking companies to get more people to their booking platforms, which would increase the price competition between restaurants on their platforms. Further, these booking platforms have links between different restaurants to highlight “similar restaurants”. Such links could get people to explore your competitors and their “deals” when they were simply looking to make a booking for your restaurant. Lastly, a customer specifically looking for your restaurant, may be forced to navigate their way past these promotional discounts offered by “similar restaurants” when looking to to book with your restaurant, they may be diverted on the way to your restaurant booking page. Under these circumstances, it is hard to suggest that these booking systems are looking to help bring customers to your restaurant when they put in mine fields that support restaurants offering discounts on their websites to attract more traffic to their websites.
Why do these large booking systems advertise and show “similar restaurants” when customers are in the process of trying to book your restaurant on their website?
Very simply, the argument is that their first priority is to generate traffic to their website, not to attract traffic to your specific restaurant.
The views and experience of one restaurant
- Primarily, people search for restaurants through Google and other search platforms, not through the websites of these large booking companies and hence why they are focused on hijacking your customers.
- When the restaurant manged to stop these large booking companies from using “AdWords” that were equivalent to their exact restaurant name the bookings received through those platforms became insignificant representing less than 1% of the online bookings the restaurant received.
- When the restaurant stopped these booking platforms from listing the restaurant within their websites, direct online bookings increased. Simply, this eliminated the mine field when customers are trying to book their restaurant within their platform.
- The restaurant, after it had stopped all contact with the large booking companies recommended to a relative who had recently recently opened small restaurant to subscribe to the booking services of a large booking platform to see what benefits this large booking platform could bring to them without offering any discounted pricing. This “experiment” lasted for approximately one year, and over that entire one year period they only received one booking through this large booking platform and it was from one of their regular customers. Very clearly, there is the argument that it is the reputation and brand awareness and the discounts offered by a restaurant that drives traffic to it and not the fact that your restaurant is listed on their platform or from the general marketing they undertake.
Like everything else in life, one mast look at the realities of every situation and not at the hype or the marketing propaganda that one is being fed. The most important thing any restaurant can do is build its own brand, its own reputation and focus on strengthening the relationship it has with its own customers and eliminate any distractions. Further, any price discounts should be targeted to specific groups of customers and specific tables within the restaurant so as to not canabalise a restaurants revenue base.
WizButler, allows restaurants to forge stronger and closer relationships with their customers through their ability to personalise customers experiences, seat VIP’s at their favourite table or the best table. Offer discounts, to specific tables and limit those discounts to specific channels. WizButler also offers restaurants their own CRM loyalty app to continue building that special relationship with their regular and loyal customers. WizButler is flexible platform that focuses on building the bond between a restaurant and its customers.
Lastly, WizButler guarantees that it will only use customer booking information to better define and improve their software experience and offerings to restaurants and never use that information in any way that competes with any restaurant. As such, WizButler undertakes never to market restaurant services directly to diners with its only focus being on creating software that brings each restaurant closer to its own customers.