Comment by toast0
4 days ago
> Like, there was a big kerfuffle a while ago about how Wendy's was going to engage in dynamic pricing so that a burger would be cheaper during the slow period at e.g. 3-4 pm, compared to the lunch rush. But that wasn't personalized. And the outcry was so strong they never did it, no law needed.
That's crazy that people were kerfuffled over it as stated. Restaurants very commomly have early bird and happy hour specials which sounds like the same thing. Please come when we're not usually busy, thanks.
The difference is that early-bird pricing is transparent and predictable. There is a written, known policy of $X discount during specific hours. You can plan for it. It's never a surprise.
Dynamic pricing means sometimes you go there, and Wendy's decides on the fly whether you get a lower price and how much. It gives Wendy's the option to pinch pennies how they see fit for their own benefit, rather than offering a deal which you can choose to accept.
I can't tell if you're implying that Wendy's was going to offer different prices to different customers "on the fly", but that wasn't the case.
It was store-wide with updated prices shown clearly. Yes it could change on a daily basis, but you would also expect it to be roughly predictable because the whole point is to get more people to come in when it's cheaper.
Saying that Wendy's is "pinching pennies" doesn't make any sense.
So... you just apparate at Wendy's instantly without cost when you decide to go? Most of us aren't so lucky. We need to travel there, which takes time and resources. Sometimes we decide to go through the drive-through and there are 5 cars in front of us and soon 3 more behind us blocking us in. When prices are 20% higher than you expected when you finally get to order, do you leave and waste all that time? Do you pay 20% extra, giving them money for nothing? Economically, both of those options are losses.
(Yes, I understand that Wendy's claimed it was only ever going to be used for discounts. But frankly, I don't believe them. The temptation to increase prices is just too powerful to ignore for a profit-maximizing MBA.)
4 replies →
Not fast food though. We have different expectations at different types of establishments
Fast food prices are pretty sticky. We consumers don’t like anything changing or being dynamic. But it is was a communications failure. If they slowly raised the prices then announced time based discounts, like how a happy hour works then it probably would have been fine. Sonic does this. But dynamic and surge pricing means I never know what it’s going to cost until I’m ordering. That’s obviously a stupid strategy for budget dining.
It wasn’t really interpreted as “cheaper than normal from this time to this time” but as “we’re increasing meal prices during rush hours, at our sole discretion, whenever we feel like it. Too bad if you paid $4.99 yesterday at the same time, today it’s $7.99 because more people are physically here.” Even if that wasn’t quite how it was going to work, that’s all anyone heard.
They were wanting to charge more during the rush and not just give discounts. It was closer to Uber's surge pricing.