Slate Money: Food – Reservations

Date: April 14, 2020
Host: Felix Salmon
Guest: Marissa Conrad, freelance journalist specializing in culture, food, and economics

Episode Overview

This episode of "Slate Money: Food" dives into the complex ecosystem of restaurant reservations. Host Felix Salmon and guest Marissa Conrad explore how reservation systems function from both the restaurant and diner perspectives, the influence of booking platforms, the economics behind reservations, the emergence of secondary markets, the role of concierge and VIP systems, and the unique challenges faced by chains and high-demand restaurants.

Key Discussion Points & Insights

1. The Double-Edged Need for Reservations ([01:00]–[02:55])

• Purpose for Diners & Restaurants
  • Diners benefit from guaranteed seating and skip wait times.
  • Restaurants depend on reservations for planning staff, food purchases, capacity management, and maximizing profits.
• Impact of No-Shows
  • No-shows and late arrivals disrupt the restaurant’s ability to fill seats, directly cutting into profits.
  • Quote:
    "If you are the kind of diner who thinks, oh... I don't need to cancel [my reservation], then the restaurant is sitting there waiting for you to show up and they're not giving your table to a walk-in... that impacts their bottom line pretty hard." — Marissa Conrad [01:50]

2. The Etiquette and Technology of Reservations ([02:55]–[05:11])

• Diner Responsibility

  • Cancel if you can’t make it—timely communication is key.
  • Quote:
    "The first rule of reservations is don't be a dick. If you make a reservation, then show up for the reservation." — Felix Salmon [02:55]

• Rise of Automated Reminders

  • Platforms like Resy and OpenTable use automated texts to reduce no-shows.
  • The ease of mobile booking leads to more casual, sometimes careless, reservation habits.

3. The Free Option Mentality & Platform Safeguards ([05:11]–[07:03])

• Casual Multiplicity of Reservations
  • Diners can now book multiple tables for the same meal "just in case," but platforms have implemented blocks and tracking to prevent abuse.
  • Multiple no-shows can lead to penalties, such as blacklisting.
  • Quote:
    "One of the diners I interviewed was very nonchalant about the fact that he'll just book four different tables for a Saturday night... and then decide the night of." — Marissa Conrad [05:23]

4. The Major Reservation Platforms ([07:03]–[10:20])

• OpenTable, Resy, Tock, and Yelp Reservations
  • OpenTable: Owned by Priceline; widespread, including smaller cities; previously restrictive about sharing diner data with restaurants.
  • Resy: Owned by American Express; urban focus; more data-sharing with restaurants, used as a selling point.
  • Tock: Founded for high-end, pre-paid experiences but branching into mainstream; variable prepayment or deposit model.
  • Yelp Reservations: Integrating with chains like Cheesecake Factory.
  • Quote:
    "The whole business model of Tock was founded on prepaying in some extent for your meal, which does make it different from the other services." — Marissa Conrad [08:31]

5. Prepaid, Variable-Priced, and Transferable Reservations ([10:20]–[14:46])

• Challenges in Changing Diner Behavior

  • Prepaying for reservations hasn't become as popular in the US as expected, despite its success for other entertainment.
  • Tock has had measurable transaction volume, but diners mostly prefer traditional reservations.

• Secondary Market Emergence

  • High-demand time slots sometimes resold for profit, like concert tickets, though this practice hasn’t become widespread.
  • Dynamic pricing mainly helps fill less popular times, rather than bidding up high-demand slots.
  • Quote:
    "It's more the... hard-to-fill time slots, when offered at a lower price, are then snatched up." — Marissa Conrad [14:10]

6. Off-Peak Incentives and the Seated Model ([14:46]–[16:48])

• Discounting for Off-Peak Times
  • Services like Seated offer cashback for booking less popular slots.
  • However, this "Groupon model" could reduce restaurant profits and encourage discount-chasing over customer loyalty.
  • Quote:
    "It's been proven time and again with anything involving discounts that you don't get a lot of repeat customers. You get people who are just chasing the next discount." — Marissa Conrad [16:36]

7. VIP Access, Concierges, and the Digital Maitre D’ ([16:48]–[21:28])

• Hotel Concierges & VIP Programs

  • Legacy of personal relationships and informal networks for hard-to-get reservations.
  • Digital VIP: Resy Select offers exclusive access to tables for invitation-only members—data driven by customer value.
  • Quote:
    "Actually, Resi is introducing something called Resi Select. And it's an invitation only program. It opens up tables at hot restaurants for these VIP resi select customers that wouldn't be available to just the normal folk." — Marissa Conrad [17:40]

• Data-Driven Personalization

  • Digital reservations allow for deeper personalization—profiles with preferences, allergies, etc.
  • Some lament loss of personal touch from the old-school maitre d’ system, but digitization makes service tailoring easier.
  • Quote:
    "At the very high end restaurants, I think they are keeping all of your information in digital files, which actually makes it easier... to 'remember you'." — Marissa Conrad [20:23]
  • Quote:
    "TOC actually is introducing this year a diner profile page where people can actually fill it out themselves." — Marissa Conrad [21:13]

8. Reservations in Chains and High-Volume Restaurants ([22:35]–[24:14])

• Adoption by Large Chains

  • Major chains like Cheesecake Factory embrace digital reservations through platforms like Yelp.
  • Innovative systems at cult restaurants (e.g., Din Tai Fung) model future tech-driven, high-throughput operations.

• Restaurant Back-End Operations

  • Hosts must deftly juggle reservation systems, walk-ins, latecomers, and “no-shows”—it’s a high-stress, real-time exercise in logistics and customer management.
  • Quote:
    "It is fascinating. These hosts really have to act very quickly, almost like seating ninjas, juggling... people who are no-showing [and] people who are running late." — Marissa Conrad [24:14]

Notable Quotes & Memorable Moments

• Etiquette You Shouldn't Forget:
  "The first rule of reservations is don't be a dick." — Felix Salmon [02:55]

• No-Show Consequences:
  "OpenTable has a policy... If you reach a certain amount of no-shows, they’ll kick you off the platform for a certain amount of time." — Marissa Conrad [06:40]

• On Data Sharing between Platforms & Restaurants:
  "OpenTable had been criticized for hoarding that data a bit, keeping it to themselves... Resy is more open with that data and restaurants like that." — Marissa Conrad [11:35]

• Changing the Diner Experience:
  “I just noticed on my Uber app, you can now select the level of conversation that you want from your driver... diner profile page would be kind of something just like that." — Marissa Conrad [21:41]

• Behind-the-Scenes Complexity:
  "These hosts really have to act very quickly, almost like seating ninjas, juggling the people who are no, showing, the people who are running late..." — Marissa Conrad [24:14]

Timestamps for Important Segments

• Introduction to Reservations & Ecosystem Overview: [00:10]–[02:55]
• Platform Features & Deterring No-Shows: [03:09]–[07:03]
• Overview and Comparison of Major Platforms: [07:03]–[10:20]
• Prepay Models & Secondary Market: [10:20]–[14:46]
• Discounting, Off-Peak Strategies, and Loyalty Issues: [14:46]–[16:48]
• Concierge, VIP, and Data-Driven Dining: [16:48]–[21:28]
• Adoption by Chains & Innovative Queue Management: [22:35]–[24:14]
• Behind-the-Scenes at the Host Stand: [24:14]–[26:34]

Conclusion

Reservations are far more complex than the mere click-and-book experience for diners. The stakes are high for restaurants, with platforms evolving to address both operational needs and customer preferences. New tech brings personalization and efficiency but challenges some traditional conventions and raises questions about loyalty, fairness, and profit margins. The conversation between Felix Salmon and Marissa Conrad uncovers both the visible and hidden mechanics of how, why, and for whom reservations really work in the modern food economy.