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Livebookings provides online reservations services for the restaurants industry, managing bookings for Strada and others, and on websites like lastminute.com and Ticketmaster. 

I've been talking to Livebookings CEO Niklas Eklund about how the business model works, and how restaurants can use the web...

What does Livebookings do? 

We help consumers to make reservations and find information about restaurants online. Livebookings is not the consumer-facing brand; we provide services for restaurants so that people can book online on their websites or affiliated sites. 

We offer a software as a service platform, and restaurants can use our marketing advice, as well as the software to manage online bookings. 

A big portion of what we deliver is consultancy advice for restaurants using the web. It’s a growing part of our business.

How big is the Livebookings team? 

We launched in 2006, and now we have 125 full time employees in nine different countries. At the company, we have a combination of tech people and restaurateurs, combining experience in the restaurant trade with the ability to help restaurants move their offline marketing online. 

Is there much room for growth in this market? 

I think the opportunity in this market is much greater than some other markets which deal with online bookings, airlines, hotels, and so on. 

The restaurant industry is much larger, and the frequency of consumer use is greater – people book restaurant much more often than they fly or book hotels. There is a big potential in this market. 

While only 7% of restaurants worldwide take bookings online, 70-80% of consumers want to find information and reserve online, so there is a massive opportunity for restaurants to promote themselves online.

Who are your typical clients? 

We have large chain restaurants such as Strada and Carluccios. We have 20,000 restaurants in 23 countries onboard, 7,000 of which use our electronic reservation system. 

We also serve the small restaurant on the corner, and we encourage them to use the web and offer promotions online to drive customers into their restaurants. 

Another big part of what we offer is a CRM system; we are big on encouraging restaurants to gather and use customer data to draw in repeat customers. We also encourage them to use Twitter, Facebook, email and SMS – we want restaurants to open up as many channels as possible, though the level of activity can depend on resources. 

This can depend on the size of the business. While some chains already have marketing people, in the case of smaller businesses, the same person may be chef, manager, and marketer. 

These people are passionate about their restaurant and food, but, especially after the recession, restaurants have had to be more pro-active in their marketing efforts to attract customers. 

What is the business model? 

Livebookings charges for two things: a monthly fee for using our software platform and for consultancy, and a transaction fee for every booking that we send to restaurants. 

We have different bundles offering services depending on the size of restaurant and the amount of help they need. 

Have restaurants been slow to see the potential of the web? 

The internet provides a big opportunity for restaurants large and small to acquire more customers.

If customers have the ability to access information on restaurants and menus and to be able to book 24/7 then they are more likely to book, especially if restaurants can offer incentives online. 

I think consumer use of and demand for the ability to book online will push restaurants into adopting online reservations. In the next few years, very few people will dream of starting a restaurant without thinking about a website. 

In the past, many restaurants a few years ago got themselves a website without a clear vision of what they were going to use it for. 

A restaurant website should be clean and attractive, and allows restaurants to cast their net wider in attracting custom. 

Are you doing anything around mobile bookings? 

Yes, we’ve already developed apps for various platforms, including an iPhone app which suggests nearby restaurants. This is all based upon making sure that restaurants are providing content, and mobile take up has been enormous 

It’s just an extension of the web, and with new platforms and devices, the barriers between mobile and the web will become minimal 

Essentially mobile can change how people transact. Up to now, a lot of mobile services have been built only for people on the go, but that is something that will change. We see consistent growth in mobile, and it will account for a big proportion of bookings. 

The next generation, which has grown up with the internet and mobiles, will never even think of phoning a restaurant to make a booking, but will assume that this is something you can do on your phone while walking along the street. 

What's planned for the next 12 months? 

We’ve been expanding the team recently to take on global challenges; we are starting to establish the business in North America, and we are building a world-class team, expanding the range of services we can offer, and expanding our client base, all part of a focused effort to become a world leader in our field. 

We launched in the US around nine months ago, and the business is growing rapidly there. We’ve been expanding our share of the restaurant market there. The market is big, and there are 150,000 to 200,000 restaurants that we can target. 

We’re also introducing new features, such as the Livebookings barometer, a survey tool which allows restaurants to get feedback from diners. This provides valuable information for restaurants, and allows them to benchmark themselves against the competition. 

Graham Charlton

Published 30 April, 2010 by Graham Charlton

Graham Charlton is the former Editor-in-Chief at Econsultancy. Follow him on Twitter or connect via Linkedin or Google+

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