OpenTable & Facebook: A social dining experience
Shares of OpenTable (NASDAQ:OPEN) soared on Monday as it was announced you’ll now be able to use Facebook to book a reservation at one of your favorite restaurants. Shares closed up more than 7.5% to $74 per share as the street welcomed the agreement with open arms. Up until this point Facebook has had difficulty monetizing its Fan Page offerings even amid great popularity. However, through the agreement both companies will greatly expand their offerings and generate substantial commissions from restaurants using OpenTable. All users need to do is visit a restaurant’s page on the social network from their mobile device and they will be able to make a direct reservation on OpenTable using the Facebook app and the ‘Nearby Places’ function.
Its appears OpenTable is looking to set up its game in the face of rising competition from websites such Yelp(NYSE:YELP) and Groupon (NASDAQ:GRPN) . Both companies have actively targeted Open Table’s impressive market share within the online reservation space. Yelp recently released a platform upgrade in which its massive user base can order and reserve at their favorite local restaurants. Groupon, through its Groupon Reserve business segment, is doing just the same. Groupon created a hybrid service which incorporates the classic daily deals approach and the online reservation market.
Shares of Facebook (NASDAQ:FB) did not fare as well following the announcement. Shares traded lower by 0.73% on Monday in line with much of the broad market. This deal follows the news earlier in the year that OpenTable is looking to get into the mobile payment space. As the world becomes increasingly mobile, the decision to focus on a mobile payment application bodes well for the company. Over the longer term it is too soon to tell if the deal will be meaningful to either company, yet the street obviously thinks so.
Sorry. No data so far.