Taiwan's Young Niche Entrepreneurs
Eztable: Making a Dime on Dining Reservations
Five food-loving young people are making money by matching hungry diners online with restaurants looking for guests. Even five-star hotels are paying for their services.
Eztable: Making a Dime on Dining ReservationsBy Jerry Lai
From CommonWealth Magazine (vol. 415 )
In January a Hong Kong financier was planning to visit Taipei to meet with clients just before the Lunar New Year. He had booked his flight and prepared his presentation, but was still at a loss as to where to take his clients for dinner. How could he find a good restaurant in a convenient location that still had a free table at the desired time?
He solved his conundrum through eztable, an online restaurant booking service that was launched in August last year. Within two minutes after he had entered his query based on area and time, the system returned a list of a dozen or so restaurants that matched his needs in terms of price, location and available seats.
Eztable was founded by five former schoolmates, all in their late twenties, who stumbled on this business opportunity because they felt from their own dining experiences that an online restaurant reservation service was well overdue. The founding team includes longtime friends Alex Chen, Peter Hsieh, Jerry Yen and Brookie Yen, who were classmates at Yang Ming Junior High School in Jhanghua City in central Taiwan. Wang Cheng-yao, an acquaintance from university and a few years younger, has also joined the group.
The five asked themselves why it was possible to reserve hotel rooms and flight seats online, but not a table in a restaurant. As they could readily observe, people would surf the Internet to find a restaurant, but then make a phone call to make a reservation. So what if all steps were done online? That's how the eztable business idea was born. They all decided to drop the careers they were then pursuing in order to fulfill the promise they had once made to one another to found their own business.
Chen quit his job as an analyst with Deutsche Bank in the United States, while Jerry Yen stopped working as a sales agent for contact lens maker Bausch & Lomb. Hsieh returned from Nanjing where he had been sent by his employer Lee Chang Yung Chemical Industry Corporation. Brookie Yen, who had just finished a postgraduate program at the Department of Computer Science and Information Engineering at National Taiwan University, brought software skills into the company and also recruited Wang, who was still studying at the department at the time.
After raising NT$10 million in start-up capital, the five established a clear division of labor among themselves, covering such areas as systems development, client development, and customer marketing.
Since eztable went online seven months ago, it has already won over 118 restaurants in northern Taiwan as clients, including popular chains like Magic Curry and King Crab as well as five-star hotels such as the Sheraton, Grand Formosa Regent and Grand Hyatt. At the same time, the number of registered members has grown to 11,000 people.
Eztable makes money in two ways: First, restaurants are charged a fee for subscribing to the website's booking service. Then eztable takes a cut of the proceeds when restaurants charge guests who booked through the website. Through cooperation with the website, the restaurants can expand their customer base, while also obtaining online booking and customer relations management services.
Similar online reservation networks for restaurants have been quite successful in the United States. In late January online restaurant booking company OpenTable became the first enterprise to go public in the United States this year, despite the economic recession in the wake of the global financial crisis.
"We have seen a marked increase in customers coming from eztable," notes Sheng Hsu-ping, deputy managing director of the Food & Beverage Department at Sheraton Taipei Hotel. The hotel was among the first to join eztable, in a bid to reach a younger, web-savvy clientele that is hard to reach with conventional advertising campaigns. Five-star hotels are eager to win customers among free-spending young people who like to eat out and can afford to splash out on wining and dining.
Reaching Free-spending Young Consumers
In order to reach these young consumers in the Internet jungle, the eztable team takes advantage of the web's inherent advantages. In targeted campaigns the eztable team posts articles that recommend restaurants and concurrently explain the new online reservation service on gourmet websites and in popular discussion forums and blogs. This approach has been quite successful. Presently, the average age of eztable's 11,000 registered users stands at 29.5. The majority of users are office workers who are online most of the day. Sixty percent of the website's members are women, which is not surprising, given that women are usually in charge when it comes to deciding where to dine with friends or family.
Knowing the preferences of these young consumers allows the eztable team to find the eateries that are presently most popular with them. They will then directly initiate talks with the restaurants to discuss possible cooperation. The Magic Curry restaurant chain, for instance, whose outlets are near rapid transit stations and frequented by the young, web-savvy crowd, gets a fair share of its customers through eztable. The record number of eztable bookings for Magic Curry in a single month has topped 600.
Eztable also encourages users to include the website on their MSN Friends list. Through MSN, eztable is able to quickly respond to customer needs. It is also an inexpensive marketing channel that allows them to create topics and attract new members.
And the eztable team has even greater ambitions. They view Taiwan only as a test case and springboard for following Taiwanese restaurant businesses and hotel chains into the China market. They also believe that the business model could be used to make online doctor's appointments at hospitals and clinics.
Prof. Chao-Tung Wen, director of the Center for Creativity and Innovation Studies at National Chengchi University, reasons that once eztable has entered the stage of exponential growth, the databank it has built will become Taiwan's most valuable source of marketing information. He also notes that eztable must ensure that its system is ready for the expected explosive growth in the future.
While the five have set their sights high, they need to keep their feet on the ground and realistically work for their company's growth.
While they thrive on Taiwanese soil, they also need to demonstrate resistance to pressure. Perhaps the next brand that crosses the Taiwan Strait will emerge from everyday life.
Translated from the Chinese by Susanne Ganz
Chinese Version: 易訂網 訂位也是門好生意