Scottish-born, Brisbane-based Richard Steven launched OnTheMenu.com.au a month ago.
The website allows restaurants to post both last minute and unlimited future booking availability, as well as display offers and photos.
Steven has signed up nine restaurants in the Brisbane area and plans to go national soon. He spoke to StartupSmart about how he’s aiming to plug what he sees as a gap in the Australian dining scene.
What was the inspiration for the business?
Having come from working in online marketing in London, I noticed that things were a bit more static here.
There wasn’t really any last minute dining deals. You have sites like Eatability, where you can upload offers, but they are on a monthly basis and only available at certain times.
Restaurants get cancellations and quiet nights all the time, so I thought that there was space for a yield-based site, a bit like Wotif.com is doing.
How is this different from daily deals sites that restaurants may use?
It’s different from daily deals because it’s about building and protecting your brand, as well as getting bums on seats and helping the bottom line.
We work with the top restaurants and focus on value adding. So, we won’t say things are ‘free’, they are ‘complementary’. We will focus on the experience of going to the restaurant and offer things like a pastry chef coming to your table to show you how it’s done.
We’ll also partner with other companies and offer theatre tickets, for example. It can be a flexible, powerful marketing tool.
Restaurants are able to announce a new menu or new offer. There’s functionality for blogs and photos, as well as the ability to post specific offers for particular times and days of the week.
What’s reaction been like so far?
Feedback has been fantastic so far. We’ve started in Brisbane and how we are looking to get inventory across Australia and New Zealand.
I had the idea about a year and a half ago. I’ve worked with businesses on their pain points before, so I had a few meetings with restaurants to see what their issues are.
One of the main pain points is that a restaurant is open if it has customers or not. If the restaurant isn’t full, it is losing money with staff and other overhead costs.
They don’t have a tangible product to sell, as such, so once they close they can’t sell anything. They need a system that knows that, for example, the quiet periods are between 5pm and 8pm on Mondays, Tuesdays and Wednesdays.
Also, a lot of restaurants have hassles in getting online listings to work for them. They have to go to lots of different sites and remember to update details all of the time.
With our site, they have a single point they can come to. We are working on widgets that will allow restaurants to granularly control their listings.
How was the process of building the site?
I hired two guys, who worked to my specifications. It was a painful process as I think the developer underestimated the complexity of the system.
It looks pretty simple on the front end. But the back end, which manages all of the listings, is quite complex. But we got there in the end.
How much has it cost you?
If you walked into an agency and asked them to build you this site, you wouldn’t get much change out of $200,000. I put around $70,000 to $80,000 of my own money into the business.
How have you pitched it to restaurants?
One of the things that has come up is that restaurants that sell 1,500 coupons via a daily deals site are faced with the situation where they have five members of staff and the phone is ringing off the hook.
What we can do is move that to a smart, online booking system.
How are you monetising the site?
There’s a flat rate of $3 per head per booking. At a later date, this rate may change, but at the moment that flat rate seems to work.
It was a difficult pricing exercise as there’s nowhere that does exactly what we do. I think that $3 is a good starting point – we’ll see if it’s too cheap or too expensive.
We will look at promoted offers and other things like that in the future. Also, a lot of restaurants don’t have a social media platform ,so we want to help them with that too.
What’s your marketing strategy?
We are working a lot with social media and foodie bloggers. We’ve had a huge SEO campaign which we got a firm to handle for us.
We have around 700 Twitter followers already and we are building an email list. We are pretty much focusing on the online space.
What are your ambitions for the business?
We are looking for a $500,000 investment, for a negotiable stake. We’ve had early discussions and have two pitches lined up. There’s interest around the business and also how the code can be applied to other areas.
We want to roll out across Australia within the next year. We have an aggressive timescale that depends on getting cash.
We definitely want to go to New Zealand and then further overseas. In the US, there are systems that do what we do, but we can certainly carve our own niche. There’s space in the market for us.
Potentially, this can be very lucrative from early on. I’m aiming for a couple of millions of dollars-worth in bookings within three years.