BooRah’s New Online-Offline Model

I had lunch recently with Nagaraju Bandaru, co-founder and CTO of restaurant search and content aggregator BooRah. BooRah started as a vertical content destination, with designs on numerous verticals. The idea was to provide a more complete consumer experience by aggregating content, metadata and reviews. BooRah is still a destination but the site has found that game tough to play in what is arguably the most competitive local vertical online: restaurants. Accordingly the company has done several different things and now also syndicates its content and technology to third parties.

The company recently did a deal with Booking Angel, which makes all BooRah restaurants capable of being booked online without any Open-Table like software installation or infrastructure (I still found the “make a reservation” link goes to OpenTable in several cases).

Consumers use the system to request a reservation online (like OpenTable) and then the back end converts that into a call sent to the restaurant. As the press release explains: “BooRah converts a request for reservation on its website to a phone call at the restaurant; confirmation of the reservation is sent to the user via e-mail.” Restaurants simply “press one to accept” the reservation as it comes through on the phone.

This provides for greater online reservations coverage than OpenTable. Bandaru said — if I remember correctly — that OpenTable has something like 2,000 restaurants signed up in California, whereas BooRah is using Booking Angel to enable all its 30,000 restaurants to be booked online. And that capability will be extended to BooRah’s syndication partners. It’s a “pay per booking” system that is initially free and then requires the restaurants to pay if they want to continue to receive the leads. This is not unlike the customer acquisition model of the now defunct PPCall vendor Jambo or its successor FastCall411.

Beyond this, BooRah has also hit upon something quite interesting, a loyalty program that maps online to offline. I won’t do justice to all the nuances of the program; however here’s how the company’s new “Dine Trak System” works:

• Consumers eat at a restaurant and, at the restaurant’s discretion, get a “business card” that invites consumers to join a loyalty program
• They register (at BooRah) online, via the telephone or via SMS (mobile really helps here)
• On their next visit they receive a free appetizer; after their fifth visit they get a bottle of wine
• Each visit does require the consumer to take action to record it via one of the three methods above
• Fraud is prevented by a unique identifier/code for each visit

There’s some complexity here but Bandaru argued that motivated consumers will take the time to record their visits (not unlike bringing a coffee or sandwich loyalty card to the vendor to be stamped).

The program is interesting because of the online-offline connection. It provides both an incentive for newer customers to return (to get the appetizer or bottle of win) and to reward regular customers. It also helps build an email list for the restaurant. It’s marketing that involves an online component for the restaurant but not online marketing per se.

BooRah is selling the program but can conveniently use its technology and database to do the prospecting (e.g., restaurants that already give out coupons). Bandaru said that initial discussions with restaurants have been very positive and shown that they’re interested in maintaining and rewarding loyaty. There’s no behavioral change for the consumer and really no education that has to be done on the merchant side because of the real-world precedent for these programs.

The restaurants will push the program to consumers (distribution) by giving out the cards at the point of sale.

We’ll see if it works, but it’s a very creative solution to some of the business model and other competitive challenges faced by BooRah.