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Fast food restaurant Wendy’s plans Uber-like surge pricing, with digital menu boards that change prices depending on demand (edition.cnn.com)

submitted 10 months ago by [email protected] to c/[email protected]

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Fast food restaurant Wendy’s plans Uber-like surge pricing, with digital menu boards that change prices depending on demand::The price of a Wendy’s Frosty could soon fluctuate throughout the day as the chain looks to introduce Uber-like surge pricing on its menu.

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[–] [email protected] 0 points 10 months ago* (last edited 10 months ago)

External appearance is not the same for both. Elasticity of demand during seasonal time of day and weekday seasonality proves it

People don't like surge pricing with Uber but they have no choice there's really no competition. Lyft is the only one so they both do it.

Dynamic pricing is done because of lack of pricing power and monopoly. Most restaurants are franchises. You can't get franchisees to exhibit monopoly power because they compete amongst themselves in the same brand and vs others. Aside from the fact that it's illegal.

I'm not saying it's good just totally not the same.

Dynamic pricing is sneaky and hard to pay attention to. Surge pricing isn't.

Dynamic pricing allows competition at certain times but screws over people that don't buy into loyalty cards rewards points or just doesn't go to the store when everyone else does.

I'm literally the customer that gets punished.

Companies don't care about customers unless elasticity is proven. They will test elasticity until net margin is maxed out at optimal volume. It's why Netflix doesn't give a shit about raising prices. When done in chunks and averaged over time people continue to pay.

Whereas when it's done in large quantities it has bigger effect on prompt demand.

Fuel stations will raise prices at odd peak times when people that don't "shop" for fuel get fuel. Then they ramp it down just before peak times.

If customers have loyalty or rewards they typically will be free of these issues because of timed promotions but mostly these prices are inelastic at those times. Which proves that those people don't care.

These things are like anything else. The loudest people make noise. consumers don't stop their habits easily unless they feel they don't have a choice. Hence why surge pricing wouldn't work in retail.

I've worked in retail operations, pricing, and manage/execute machine learning for these projects. You can try to explain it to me and why you think it's the same but respectfully you're just patently wrong.

If people actually knew the difference they could look for it but they won't if everyone just says it's all the same and mislabels it. People should be looking out for dynamic pricing. Surge pricing doesn't exist in retail and won't in the US market.