Bucks: OpenTable and Its Snail-Mail Rewards Checks

Courtesy of OpenTable

OpenTable certainly makes it painless to find a good restaurant and make a reservation. So why the heck can’t the company make it more convenient to redeem the rewards points you earn by using its service?

Over the past decade, OpenTable has grown into the dominant online restaurant booking service and now claims more than 20,000 eateries, mostly in the United States. As of March, it says, it has seated more than 200 million diners.

The reasons are clear: You can check online for available tables at top restaurants in most major markets, making a booking and get a confirmation e-mail – all for free, and without having to wait on hold with a (sometimes) snooty reservations host.

Investors in the company have fared well: Shares of OpenTable closed Monday at $107.84, compared with a price of about $20 at its initial public offering in 2009.

Part of the bargain for diners is that for every reservation you show up for, you earn rewards points, which can defray the cost of future meals — typically, 100 points, or $1, per restaurant visit. When you accumulate at least 2,000 points —worth $20 — you can go online to your profile, and click “redeem points.” Simple enough.

But from that point on, things get oddly old school. The company mails you a paper “Dining Cheque” via snail mail, and warns that for security purposes, they are delivered in plain, white envelopes. That means, the Web site says, you must “watch your mail, to make sure yours isn’t accidentally discarded.” That’s a lot of lurking around the mailbox, since, the site says, some checks can take up to six weeks to arrive.

When the check does arrive, you bring it with you to your next OpenTable outing (if you remember), present it to the waiter when you get the tab (ditto) and the amount is deducted from the total. You must use it within six months, or it expires.

Since the OpenTable computer system provides real-time information about available tables at restaurants, we wondered, why can’t it also provide real-time rewards information to the restaurants that could be accessed at check out? That would allow customers to redeem their rewards without having to keep track of yet another piece of paper.

Scott Jampol, director of consumer marketing for OpenTable, says that the company has  technological and privacy issues to work out in order to implement such a system.

The OpenTable reservation system, for example, is separate from a restaurant’s payment system. And there would need to be protections to ensure restaurants wouldn’t have access to a customer’s entire reservation history when accessing rewards information.

Such issues could be addressed, he said. But since the current method works just fine, he said, why tamper with it? “We like to think it’s not a difficult process or program,” said Mr. Jampol. “Our diners actually love this program, and our restaurants do as well.”

The current redemption process, he said, is easy for both dining customers and restaurants to understand and manage because it’s similar to traveler’s checks. “For the restaurants, it doesn’t require any special hardware or software,” he said. “It works really well on both sides.”

Except, that is, for customers who lose their paper checks, or forget to bring them, or wait so long for the check to arrive that they forget it’s coming and throw away the nondescript envelope by mistake. Mr. Jampol says most checks generally arrive much more quickly than three to six weeks — often in a few days — but the company must “manage expectations” because of its reliance on the postal service.

A cynic might wonder if OpenTable is hoping that some customers don’t redeem those points. But Mr. Jampol says that’s not the case. “We hope people do redeem their points,” he says, adding again that “they love this program.”

Mr. Jampol does say that in any sort of rewards program, accumulating points matters a lot to some people, who seek out restaurants offering bonus points to build their total, and not so much to others.

He declined to provide data on OpenTable’s point redemption rates. As to whether it would be a financial burden for OpenTable if its members redeemed all their points, he said he’d have to check with the company’s finance group. But he said that the company did account for all of the points. “When points are earned, we intend for (customers) to use them,” he said.

So for the foreseeable future, using your points will require keeping track of paper checks. “We’ll continue to re-evaluate if we feel there’s a better solution,” he said. But don’t expect changes anytime soon. “It’s working pretty well.”

Would you prefer an automated redemption option for your OpenTable points? Or are you satisfied with the check-in-the-mail program?

Article source: http://feeds.nytimes.com/click.phdo?i=ba9a004a0ec7033f716686dae1563f22