Many restaurants have a philosophy about using multi-restaurant online ordering portals - they grit their teeth and do it.
Most of the time restaurants allow themselves to be listed on portal sites to get any exposure they may bring. According to a Cornell Hospitality Report, though, “nearly half of the consumers on multiple-restaurant sites (47.1%) said they clicked over to the restaurant’s own website to order their food” once they found a restaurant they liked. That’s good news for restaurants using NetWaiter – it can, not only save the restaurant a lot of money, but also allow the restaurant to interact with their customers directly, rather than be ‘commoditized’ on a restaurant portal.
The bottom line – portals can charge some outrageous fees. According to a recent piece in Gourmet Marketing, a well-known portal site they investigated "keeps their contract terms behind close(d) doors, and the rates vary by restaurant. This incredible lack of transparency shortchange(s) restaurants… It gives restaurant owners little room to compare in competitive markets, especially as many times restaurant owners are bound by a non-disclosure agreement.”
The article notes that fees can range from 11% to as high as 20%. In addition, restaurants don’t directly receive money from incoming orders – they have to wait for the portal to send them a check (minus their fees). Not only that, as one restaurant owner admits, portal sites also use a restaurant’s customer list against you. "I never see a report of who ordered through the portal," he said. "I'm sure they are using my customer information to market themselves to other restaurants."
The message to restaurant owners is simple - if you use portal sites to help promote your restaurant, you should be very aggressive about converting those customers to your own online ordering site. Rather than pay huge fees to a portal, customers that order directly from your site will allow you to extend your brand identity to them, receive payments directly, and capture your own customer information.
To capture those 47.1% of visitors that would rather order directly from your website, you need to make sure your ‘Order Online’ link is prominently displayed on your homepage. Additionally, you should inform guests that have already used a portal to order from your restaurant that you have your own online ordering system, guaranteed to be up-to-date with the latest offers and menu information. Including a flyer with each portal order or offering a first-time discount for using your system are goodways to make sure their next order will be “NetWaiter-ed” from your restaurant.
There are two major types of online ordering providers: Portal-Based Sites and Site-Based Systems.
As many know, portals group a number of restaurants on one website for diners to search and find restaurants based on a variety of criteria. It’s typically free for a restaurant to get listed and restaurants simply pay a percentage of each order. At first glance, Portal-Based Sites appear to be a good deal - they’re inexpensive to join and restaurants don’t pay anything unless they get business.
But, let’s look further. Most portals show the same exact listing for every restaurant, offering no individuality or branding capabilities. In addition, a restaurant’s ability to control their information and menu is often minimal. This leads to errors and customers can receive false information. Furthermore, if a restaurant links their own website to their portal listing, they are powerless to stop would-be customers from ordering at a different restaurant. If a customer did click from a restaurant’s website and completed their order, the restaurant ends up paying the portal fee (which could be as high as 15%-25%) - for an order that originated from their own site!
Many restaurant owners are simply dissatisfied with the results and headaches of being listed on a portal. They joined a portal (or many portals) because they saw it as a riskless opportunity and didn’t realize the downfalls until later. Errors, customer complaints, and not receiving proper payment from the portal are plenty of reasons to be upset.
Restaurants with the most successful online ordering businesses use a Site-Based System (like NetWaiter) with integrated marketing functionality. Successful restaurant owners using their own custom site realize they can reap huge rewards if they promote the service to customers. For example, a restaurant that recently started with NetWaiter immediately began pushing their site to customers using Twitter, Facebook, store signage, and messages on their receipts. Within six months, their NetWaiter site helped them to almost double their takeout business. Orders roll in every day.
The functionality and benefits empower restaurants to take ‘an ownership’ in their online ordering business. The ability to provide customers a seamless and branded ordering process is also very valuable. Best of all, because the fees are substantially less than a portal, restaurant owners recognize the savings and know that promoting their own online site will not cost them an ‘arm and a leg’ or drive sales to other restaurants.