Wendy's Will Experiment With Dynamic Surge Pricing for Food in 2025
upstart writes:
Company speaks out after reports of "surge pricing" test led to calls for boycotts online:
A day after American fast food chain Wendy's announced plans to test dynamic pricing and AI menu features in 2025, the company clarified its plans.
Wendy's said it will not dynamically raise menu prices based on demand after reports about the experiment, which was set to roll out in 2025, caused a stir online. In a statement to Reuters, a Wendy's spokesperson said it "would not raise prices when our customers are visiting us most." Instead, the company framed experimental price changes as discounts during "slower times of day."
"We said these menuboards would give us more flexibility to change the display of featured items. This was misconstrued in some media reports as an intent to raise prices when demand is highest," the company told Reuters. "We have no plans to do that."
Presuming that lowered prices during slow times will eventually rise again, it appears some sort of dynamic pricing will still be taking place.
According to the original report from Nation's Restaurant News and Food & Wine, prices for food items would automatically change throughout the day depending on demand, similar to "surge pricing" in rideshare apps like Uber and Lyft. The initiative was disclosed by Kirk Tanner, the CEO and president of Wendy's, in a recent discussion with analysts.
[...] In conversation with Food & Wine, a spokesperson for Wendy's confirmed the company's commitment to this pricing strategy, describing it as part of a broader effort to grow its digital business. "Beginning as early as 2025, we will begin testing a variety of enhanced features on these digital menuboards like dynamic pricing, different offerings in certain parts of the day, AI-enabled menu changes and suggestive selling based on factors such as weather," they said. "Dynamic pricing can allow Wendy's to be competitive and flexible with pricing, motivate customers to visit and provide them with the food they love at a great value. We will test a number of features that we think will provide an enhanced customer and crew experience."
[Ed's comment: As of 29 Feb, there is some reporting that the CEO of Wendy's has withdrawn the entire plan]
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