Tock founder and CEO Nick Kokonas is not quiet about his feelings toward OpenTable, advocating openly both for his restaurant reservation and payments platform, but also attacking OpenTable’s business practices. His latest Medium post, aimed at restaurateurs on the OpenTable platform, aggressively takes on the latter’s fees and what he deems to be shady business practices.
According to Kokonas, there’s a 40 percent chance an OpenTable restaurant customer has wrongly coded its website and is overpaying OpenTable for monthly per-diner fees. In short: OpenTable charges a restaurant per diner when that diner books a reservation through the OpenTable website. This charge makes sense when you consider that OpenTable powers that diner’s discovery of a particular restaurant — as a restaurant, you’re paying a small fee for additional marketing. If a diner goes directly to the restaurant’s website to book, OpenTable charges significantly less per diner. This only works, though, if the restaurant website adds a particular line of code to differentiate the two experiences — which, he says, many do not. He also says OpenTable doesn’t do much to alert restaurateurs, who may not be tech savvy, to this problem.
So, Kokonas and his team built a program to analyze restaurant websites that use OpenTable, and found that nearly a third of the 31,000 restaurants analyzed had no links to OpenTable on their website, meaning they wouldn’t qualify for the reduced fee — and 900 had links but no referral code, something that Kokonas says could have been going on for years. Important to note here that this referral code is explicitly referenced in a footnote in the OpenTable contract, which he also explains in his post.
Out of his criticism of the OpenTable system comes a tool for restaurateurs, hosted on the Tock website. OpenTable customers can enter their restaurant’s URL and receive a report that tells them if the site contains the proper referral code (if it doesn’t, they’ll send instructions on how to include it) and info on other practices, like whether or not OpenTable is running a Google Adwords campaign against your restaurant to compete for customers. (Kokonas provides no data on how this works or how many restaurants this may impact.)
Kokonas has not been shy in his criticism of OpenTable, even posting a copy of the cease and desist letter he received from the company’s lawyers earlier this year. This time, though, it seems the data speaks in his favor. OpenTable has not responded to a request for comment.