Your Saturday night dinner could be waiting for you instead of you waiting on it.
In the past few years, a number of mobile waitlisting management services have emerged to improve the waiting time experience, including NoWait, buzztable, quickcue, NoshList, Table’s Ready and QLess. These applications are focused on helping restaurants increase revenue in 3 ways:
- Seat more guests
- Collect more customer data
- Improve customer experience
The idea behind these apps is simple: you enter a restaurant and submit your name and number to the host, you receive text message updates on the status of your waiting time (some apps also allow you to view the number of parties ahead of you on your smartphones) and you are notified when your table is ready.
“Customers get a more enjoyable experience with real-time information so they can wait where they want and still go to the restaurants they want to.” –Robb Myer, President & Chief Product Officer at NoWait
The apps not only provide wait time notifications and management, but also allow restaurants to engage with customers via e-mail or text message and utilize customer data to track performance and customer retention. For example, BuzzTable automatically creates a guest profile for each customer upon submitting his or her name and number, helping the restaurant track the individual’s dining history, birthday and customer preferences. The marketing features allow restaurants to share promotions, coupons and create custom retention rewards. Some other features include allowing customers to invite friends to the guest list or create a party and share their restaurant check-in on Facebook.
One study found that letting customers use their cell phones to be notified instead of coaster pagers resulted in 9.1 percent fewer turn-aways. Coaster pagers are also expensive and start at $50-$100 per pager (LRS sells a 15-pager kit for $928). Additionally, the cost for replacement or repairment of a pager can range from $70-$100 per pager. It is not uncommon for pagers to be lost or stolen as reported by many restaurants. Therefore, not only are fixed startup costs reduced for a waitlist management system, but also the maintenance costs required to replace or repair pagers.
Comparison of Startup Costs:
Restaurant Pagers: $2000 – $6000 (according to Foodservice.com)
Waitlist app: $0 – $1200 (range based on required iPads or computers)
*QLess offers to even purchase the old pager system from the restaurant and apply its current value to its QLess bills.
**The apps make money by charging restaurants a platform fee to manage their guests with costs ranging from ~$49-$200 per month depending on the selected plan. For example, NoWait offers three plans for restaurants based on the number of parties a month: free for 200 parties, $114 a month for 1,200 parties and $199 a month for 2,500 parties.
With over 37 billion hours of time lost domestically every year waiting in line, these mobile waitlist management applications are providing a cost-efficient solution to help increase customer retention, create a 2-way communication channel between the restaurant and its customer and improve the wait time experience. Although restaurants have been the main target for these apps, it will only be a matter of time for these waitlisting management apps to appear at hospitals, pharmacies, the DMV, car washes, amusement parks and other places where long wait times are common.
Threats to Consider
It has been argued that the market for NoWait is considerably larger than that of OpenTable’s (OpenTable offers an electronic reservation book for users to make restaurant reservations online). A recent article stated that there are 270,000 casual dining restaurants that NoWait targets compared to the 35,000 fine dining restaurants OpenTable serves. However, OpenTable has been quick to launch its own Table Management App that enables restaurants to manage their reservations and tables in sync with their OpenTable Electronic Reservation Book. OpenTable’s market dominance and ability to offer both online reservations and waitlist management for restaurants without reservations poses a significant threat to any recent waitlist management apps. Additionally, OpenTable’s recent partnership with Facebook adds to the social experience of the app, allowing users to share their restaurant visit or reserve on Facebook. OpenTable already offers many of the features that waitlist management apps provide, stripping away uniqueness and competitive advantage.
OpenTable Table Management App:
There have been many case studies performed to prove the effectiveness of mobile waitlist notifications. Below is a summary of one performed by Buzztable on Penelope, a restaurant in NY (and one of my favorite brunch spots!):
[For the full case study: http://www.buzztable.com/customers/penelope/]
-Over 25% of guests added to wait list ended up “walking away” due to 60+ minute waits
-Received an average of 12 guests complaints per week regarding long wait times
-Staff was reluctant to change their previous wait list system
-Limited data on customers made it difficult to identify repeat customers
-Increase revenue by decreasing walk-aways and canceled tables
-Increase guest experience and overall satisfaction during wait time
-Achieve instant staff buy-in with minimal integration, training and upkeep
-Collect customer data and easily display to staff for improved practices
The Solution: BuzzTable
Wait List Management: BuzzTable provided Penelope with their WaitList+ platform, consisting of 3 parts: 1) an iPad-based Wait List Management application that allows hosts to greet and notify their guests with SMS-messaging and collect/store guest information; guests are then prompted to download 2) BuzzTable’s Consumer Mobile App (free for iPhone & Android) which gives customers the ability to check their wait list progress, browse top trending dishes with photos, unlock rewards, and provide private feedback; and 3) E-mail reports (sent daily and/or weekly) which send all collected data directly to the restaurant.
Custom Account Settings: Penelope’s account was created in roughly 15 minutes, which included custom text messages to match their brand, custom status colors on the WaitList interface, plus unique loyalty rewards, high-res photos of their top dishes, and custom feedback fields within the BuzzTable Consumer Mobile App.
5-minute Training: Penelope’s hosts were fully trained on the system in less than 5 minutes. This gave them confidence to use the system in a live environment immediately following training.
-28% Decrease in Walk-aways = $27,500 of incremental revenue over 60-day period (at an average guest check of $25 per person)
-1,101 additional seated guests
-Decreased Guest Complaints by 66%
-100% Approval Rating from Staff
-3,800+ Unique Customer Profiles Created (BuzzTable enabled FOH staff to identify repeat guests and VIPs. Of the 3,800+ guests, more than 700 enrolled into Penelope’s mobile loyalty program directly through the BuzzTable app. This opt-in process delivered email, birthday, Facebook and other key info on guests to the restaurant.)
-110+ Facebook Engagements = 4,100+ News Feed Impressions
-90% of Guests Agree BuzzTable is a “Big Improvement”
-Guest App Retains 45% More Guests (Guests who downloaded BuzzTable’s Mobile Consumer App are 45% more likely to be seated (not walk-away or cancel) than other guests.)
Share with me your thoughts on waitlisting management apps @tiffanydstone or comment below!
Sources: http://www.buzztable.com/, http://qless.com/industries/restaurants/, http://www.crunchbase.com/company/nowait#ixzz2d5D6GpLm, http://www.benzinga.com/success-stories/13/08/3852548/pittsburgh-startup-nowait-could-overtake-opentables-volume-in-2014#ixzz2d5IYwrJE, http://www.benzinga.com/success-stories/13/08/3852548/pittsburgh-startup-nowait-could-overtake-opentables-volume-in-2014#ixzz2d5IVeWdj, http://techcrunch.com/2012/08/28/death-to-the-restaurant-buzzer-nowait-raises-2-million-for-ios-app-waitlisting-system/, http://www.sfgate.com/business/press-releases/article/NoWait-Seats-16-Million-Diners-on-Par-to-Surpass-4727191.php, http://thenextweb.com/insider/2013/05/01/bing-fund-invests-in-buzztable-an-app-that-tracks-when-youll-be-seated-at-your-favorite-restaurant/, http://www.foodservice.com/articles/show.cfm?contentid=15701&title=Restaurant%20Text%20Pager%20Systems%20and%20Cell%20Phone%20Pager%20Systems%20-%20A%20Cost%20Benefit%20Analysis, http://www.tablesready.com/pricing.php