Surge Pricing Is Coming to More Menus Near You

https://www.wsj.com/business/hospitality/surge-pricing-is-coming-to-more-menus-near-you-66a245f3

by impish9208 • 2 years ago

24 45 2 years ago

ein0p• 2 years ago

And that’s why I now pack a lunch. $20 per meal is a bit too rich for my upper middle class blood, and it also isn’t as healthy.

twen_ty• 2 years ago

Wait till your grocery store starts surge pricing.

WeylandYutani2• 2 years ago

I am lucky to live in a country where there are always at least 3 supermarkets in walking distance so they are desperately competing with each-other.

xhkkffbf• 2 years ago

Why is this new? My local restaurant has "half priced burger night" on Tuesdays. Happy hour is a favorite solution for getting people into the place early.

mitchdoogle• 2 years ago

I know right? It's just as logical to frame this as reduced pricing at off-peak times, but I guess that's not so sensational.

Nevermind that many people would be happy to pay a little bit extra to avoid waiting during peak times.

catchnear43213• 2 years ago

you would think the companies rolling these out would have that level of sense from the get go. turns out, they didn’t, and described it in the sensational way.

“dynamic pricing and daypart offerings.”

that’s the ceo of wendys - not the media. sure, they tried to awkwardly correct the optics.

there may be upsides, but to act like this is purely media sensationalism is to sound quite a bit like jumping too far in the other direction. the why isn’t terribly important. just like the ceo, the optics are off.

add-sub-mul-div• 2 years ago

If that's what it was going to be, that's what they'd call it.

We've entered a new era. Dune costs more to see at the theater near me than other movies. The default movies are not discounted. Dune just has an extra fee for being popular.

bandyaboot3• 2 years ago

We've entered a new era. Dune costs more to see at the theater near me than other movies. The default movies are not discounted. Dune just has an extra fee for being popular.

That sounds totally reasonable to me.

prepend2• 2 years ago

Because you know it’s Tuesday night and that the price is half off.

This way you won’t know the price until you show up so it’s hard to predict the price until you have some sunk costs.

bandyaboot3• 2 years ago

In addition to representing basic supply and demand principles, this sounds like a good way to mitigate the worker shortages than many restaurants have faced recently. You need enough workers to meet peak demand. This serves to lower peak demand by spreading it out.

autoexec6• 2 years ago

No one is going to rearrange their life according to when some burger joint has lower prices. You'll never know when that will be anyway. Many people have zero say over when their employers allow them to eat lunch in the first place. People eat when they have time, or (less often) when they are hungry and none of those things take into account price.

At best this will drive business to restaurants that aren't playing games with their prices.

bandyaboot3• 2 years ago

Well I wouldn’t classify choosing to go to a restaurant during off-peak hours as rearranging my life and I think I have a fairly good idea of what times are off-peak for most restaurants.

olliej2• 2 years ago

I feel the solution here is to say all price increases (for any service) must be announced at least 2 weeks in advance, and you cannot increases prices more than once a week.

So you don’t say “you can’t surge prices in these markets, or these conditions”, you just make it so surge pricing (or as it used to be called “price gouging”) is not a viable strategy. You leave open the ability to charge more in times of generally high demand but people know ahead of time, and can schedule around that, and there’s no risk of the standard emergency/disaster gouging Uber and co are so fond of.

This will also stop the gas company BS where there’s a minor disruption and they use that as an excuse to instantly increase fuel prices.

bdcravens• 2 years ago

This would be tougher on smaller restaurants, which can't buy raw materials in bulk, and are often subject to local market conditions surrounding produce, etc.

zamadatix3• 2 years ago

Do your local restaurants already change prices more than once a week without notice? If not, how is limiting to that impactful to them? Can't say I've ever seen a local restaurant adjust food prices on the fly based on the price of their last purchase but maybe things are different elsewhere.

olliej2• 2 years ago

Their suppliers wouldn’t be able to subject them to surge pricing either.

That said all the articles about restaurants considering surge prices have been nationwide chains, so not exactly the group that lacks pricing control.

WeylandYutani2• 2 years ago

Restaurants do not provide a crucial service. You can cook at home. I don't think the government needs to interfere.

zamadatix3• 2 years ago

Out of curiosity is that view limited to retail pricing laws or does it extend other types of regulation as well? If it doesn't extend what makes pricing regulation different from other regulation in terms of consumer protection, in your view?

pcthrowaway• 2 years ago

Interestingly, this isn't that different than restaurants offering weekday lunch specials, or happy hour, or other types of deals to draw more traffic during typically slow periods.

Although the inverse of increasing prices due to demand does appear to be new.

This might be received much better if it were billed as "ad-hoc deals" with the max price being the regular price, and deals being created by their point-of-sale system to account for unutilized bandwidth, and even inventory (the system can create specials on items which have ingredients that are nearing end of life, or which the restaurant's supplier itself put on special)

Calling it "surge pricing" seems like a way to just piss people off

mc32• 2 years ago

Yeah I think if the prices are predictable it would be less of an issue, but if it’s based on oscillations in demand, then you can’t know in advance if you’re going to pay normal or extra pricing.

bsder• 2 years ago

Except what these places don't want to do is tell you the "max price" because then people will compare against that and give them grief. What they want to do is hide the max price so you never know what it is.

Personally, I hope these companies keep doing this. Once you get enough pissed off people, you'll get a law banning this crap.

autoexec6• 2 years ago

This is just one step towards getting consumers to accept what they really want to impose on us: prices that change according to the customer (https://link.springer.com/article/10.1057/s41272-019-00224-3)

Never knowing how much something will cost you, and accepting that the price you pay will be different than the price that others pay for the same item. Once we've accepted this, it'll be be much easier to get to us to accept discriminatory pricing.

Go out of your way to reject this now, or you will absolutely pay for it later.

prepend2• 2 years ago

I remember in econ101 the professor showed the supply demand curve graph and explained consumer surplus and how it was inefficient because there were consumers willing to pay more but the supplier had to set a single, optimal price.

The professor went on for a few minutes on how dynamic pricing per consumer would maybe be possible one day to realize this and how much more money would make. But he said ultimately it wasn’t fair and he was glad it was “impossible.”

kelseyfrog2• 2 years ago

So basically how pricing existed since the dawn of time until the creation of uniform pricing in the 1870s? What's old is new again.

autoexec6• 2 years ago

In the 1870s they couldn't force you to use their app to see a menu, look up how much money you have in the bank, then have that app show you prices according to how much money you have. Why shouldn't a loaf of bread coast a percentage of your income? Get a new job that pays you 20% more, all your prices just go up by 20%.

everdrive• 2 years ago

And I'm going to fewer restaurants! Maybe it's a good thing that companies are trying to squeeze blood from a stone. It makes it much easier to walk away from convenient, but bad habits.

extraduder_ire• 2 years ago

Wonder how long it will be until I see "market price" at a fast food restaurant.

jdeibele• 2 years ago

I've been hearing that you have to use an app to get reasonable prices at fast food restaurants anymore.

Yesterday, I tried the Wendy's app. A Dave's single cheeseburger that listed for $6.49 (in the app) had a special offer of $1.00 in the app. I ordered it as an experiment and sure enough, that was the price when I got it in the drive-thru.

McDonald's had deals in their app but they were conditioned on buying more - get X for $1 if you buy Y. That seems like a more sound approach for the restaurant. I appreciated the opportunity to get just one fast food item, though.

I think the app prices are updated daily, perhaps weekly. It's not a reach for them to be updated a lot more frequently with that restaurant's flow.

bradley13• 2 years ago

Dynamic pricing has always existed. To take an obvious example: Someone on a tight budget will take the time to collect and use coupons. Someone with a comfortable income will not. Same product, two different prices.

They are just getting much more obvious about it.

lotsoweiners• 2 years ago

Instead of complaining here in honor of this surge pricing idea maybe someone on X/Twitter/Reddit/Threads should get “throw a brick through a Wendy’s window” trending on their platform of choice.

Surge Pricing Is Coming to More Menus Near You

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