All Articles Food Village Vines combines features of OpenTable and Groupon

Village Vines combines features of OpenTable and Groupon

3 min read


This post is by Restaurant SmartBrief contributor Janet Forgrieve.

VillageVines is a 7-month-old startup that’s winning buzz and signing new restaurants with a business model that borrows several ingredients from industry leader OpenTable and throws in a healthy dash of Groupon-like daily deal offerings, to create the latest example of restaurant industry sites morphing to meet changing consumer demands.

The site made news this week when an investor group led by Hearst Corp. paid $3 million for an equity stake, funds the company plans to use to raise its profile in the five major markets where it currently operates. Here’s how it works – customers sign up for free memberships and pay $10 each time they make a restaurant reservation. The site also gives users a $10 credit for every friend they refer who ends up booking a table at one of the participating restaurants.

When they show up for their meal, they remind the server that they booked on VillageVines and receive a 30% discount on the total tab, including the bar bill. The one catch – reservations must be made at times specified by the restaurant, a provision that allows eateries to book up tables at less busy times of the day or evening.

It’s a small stipulation, but a key one for many eateries that have experimented with Groupon and found themselves flooded with coupon-wielding diners at peak times of the day. Instead, VillageVines diners are more likely to fill tables that would otherwise sit empty.  They’re also much more likely than many Groupon users to make return visits – VillageVines users aren’t limited in how many times they can avail themselves of the discount at their favorite eateries, they just have to book at the times specified by the restaurant.  One participating restaurant told the Associated Press this week that the system works out great, with regulars dining earlier or later than they might have otherwise, a shift that frees up more peak-time tables for walk-in patrons.

OpenTable is the largest and best-known restaurant reservation site, but has come under fire in some quarters recently for pricing policies that some restaurateurs find excessive. VillageVines founders acknowledge OpenTable’s leadership but also say there’s room for competition from innovative new players.

“There’s really only one player in the market right now: OpenTable. There’s a huge amount of room for growth,” founder Ben McKean told the AP.

Meanwhile, established players aren’t ignoring the appeal of the deal. OpenTable members earn customer loyalty points that add up to restaurant savings and last year it launched a weekly deal feature for local restaurants. Additionally, OpenTable branched out by partnering with Yelp, a site best known for its “regular people” restaurant reviews, to offer a pop-up link that lets Yelp users book reservations without becoming OpenTable members.

Have you held back on listing your restaurant on OpenTable or offering deals on Groupon? Is that likely to change as new sites offer more flexible options?