Eat 2 Eat 1n249

everything about food

eat2eat.com Presented by: Group 4

•In 2000, Vikram Aggarwal founded Eat2Eat pte ltd in singapore. •Eat2Eat.com was an internet- based restaurant portal promoting fine dining in Asia Pacific region. •The web site was a guide to the region’s best restaurant with an online reservation service. •Features included restaurant reviews, recipes, interviews with leading chefs and list of top establishments in various categories. •Eat2Eat.com allowed diners to reserve tables through internet,conveniently and with a wealth of ing information .

Introduction

the

•By January 2006, Eat2Eat.com covered more than 800 restaurants in Bangkok, Hong Kong, Kaula Lumpur, Shanghai, Singapore, Seoul, Sydney, Taipei and Tokyo. •The company sold Web site banner ment to restaurant wanting additional promotions. •Eat2Eat.com had received considerable recognitions, a poll taken by Smart diners organizations in US had rated it as a top restaurant information reservation site in the world. Google and Yahoo! SEARCH ENGINES also ranked it first in search result. •However after 5 years of operation, the website’s ed base remained at 12,000 customers.

• Industry: Online restaurant reservation • Company: Online restaurant reservation database • Competitors: City oriented online database Airline/Hotel Reservation sites OpenTable.com InterActive Corp (IACI) Alibaba.com SavvyDinner.com Restaurent.com Yelp, Inc.

Industry Review

• • • • •

Threat of new entrant- high Bargaining power of supplier- low Bargaining power of buyer – low Rivalry among existing player- moderate Threat of Substitute- low

Porter’s Five Forces Analysis

 The business model is sample but make sense that can generate a real cash flow from its operation income.  However, it still has not reach its breakeven point for five years; therefore, a extra funding resource will be needed in 2006, and how to utilize the new financial making a successful strategy for a long run business.

2006 Expansion Plan for Eat2Eat.com

• Initiate implementation of website use in other countries and regions of the world - Sustain competitive advantage as world’s best online restaurant reservation service - Expand website capabilities by partnering with credit card companies, hotels, airlines, and large restaurant chains

Contd….

• - Designate portions of each month to expand business to a new area by personally meeting with new restaurant managers - Lower operating costs by increasing website advertising - Increase number of employees so manager can fulfill duties

• Strengths

- Company type is rare – online restaurant reservation sites don’t really exist - Maintenance costs are low - Management has complete control over business operations - Quick decision making due to low number of employees and management - Business can be accessed anywhere by anyone due to technological advancements

SWOT

• Weaknesses - Too much work for low number of employees - Low market penetration - Low international recognition - Limited time - Limited financial capital - Consumers find phone reservations easier and quicker

• Opportunities - Partner with credit card companies to increase consumer exposure - Partner with online hotel and airline reservation websites - Expand business to other countries and continents - Expand business to phone reservations as well as online reservations - Expand business to cell phone capabilities - Increase revenues with increased website advertising

CONTD….

• Threats - Hotel and airline reservation websites - Phone restaurant reservation services - Increasing costs of technological advances and business growth - Other new restaurant reservation websites - Weak economy

STRATEGY

Our strategy will be . . .

IMPLEMENTATION

RESULT

STRATEGY PROPOSED

financial alternatives

financial allocations STRATEGY PROPOSED

Eat2Eat.com should evaluate which cities have potential to increase revenue sufficiently then close the business where we cannot see any significant improvement in the future.

It can evaluate this factor by calculate the contribution margin from single consumer from different cities and the contribution margin from each city to see whether Eat2Eat.com has a right segment positioning towards this regional market

to determine how much effort we should make to different cities

we evaluate this figure by the contribution margin from 2004 marketing campaigns, to see whether the marketing events have significant positive influence on hip growth.

• According to the case description, 7%-10% of consumers' bills constitute 40% of eat2eat.com revenue, which is US$478,000,

• therefore, once we close the operating insufficiently cities, then allocate the new funding to improve the performance where illustrate a highly acceptable behaviour for online restaurants reservation

CLOSE DOWN

Contd…. For example, Bangkok is the lowest ranking of all cities, and constitutes a big lost in 2005.

• Shanghai and Singapore are suffering extremely loss too; however, the revenues are remaining the same while cost went down rapidly. • Those two cities can be put into probation status for one more year to see the performances after implementation of new marketing events and additional sales force.

Contd..

• We can see the amount of money of per consumer spends in two cities, Shanghai and Sydney are much higher than others but they are still suffering from huge loss in operating net income, which means the expenditure of per consumer in fine dining is positioning in high-end segment rather than general public; therefore, a repositioning in marketing segment is crucial from those two cities.

Once we make a right positioning in potential market, it could have opportunity to become a golden cow

marketing and technology divisions are going a good job; however, Eat2eat.com still need some innovation to keep the competitive advantages; otherwise, the official websites host by restaurants their own are likely replace its position..

a buzzing blogs hosted by local food critics could easily have impact on advertising buyers’ willing to pay advanced ment provided by Eat2Eat.com

MARKETING AND TECHNOLOGY DIVISIONS

CLOSING THOUGHTS….

MARKETING STRATEGY • Implementation Raising capital immediately, and then allocate for marketing

marketing on cities who has potential profits according to contribution margins

Using high technology ex WAP enabled ordering system to build higher entry barrier towards other competitors.

Questions…