Wendy’s is preparing to test an “Uber-style” surge-pricing model where prices will fluctuate throughout the day based on demand — meaning a Dave’s burger will cost more during the lunchtime rush.
Wendy’s CEO Kirk Tanner — who rose to the chief role earlier this month — announced the new system on a call with investors, noting that the pricing menu will begin testing in 2025, Daily Mail earlier reported.
With the dynamic pricing model, the chain’s iconic Dave’s Single could increase by as much as $1 at lunchtime and drop down by the same amount after the lunch rush.
With constant pricing shifts, Wendy’s will rely on “digital menu boards,” Tanner said.
Come 2025, Wendy’s is implementing a dynamic pricing model that will see prices fluxuate throughout the day based on demand, meaning items will cost more during the breakfast, lunch and dinner rushes. Getty Images
After an initial $20 million in the high-tech menus, the Ohio-based company will be able to update its prices in real-time without incurring additional overhead costs, according to Tanner.
The price of Wendy’s quarter-pound cheeseburger already differs depending on location.
For reference, the fast-food chain’s Newark, NJ, location charges $5.99 for the popular offering, while at an outpost in Times Square, a Dave’s Single goes for $8.19.
With the dynamic pricing model, New Yorkers could expect to shell out nearly $10 for a cheeseburger at lunchtime — not including a drink or fries.
Data from consumer transparency platform PriceListo has already determined that Wendy’s is the most expensive fast-food chain in the US after menu costs rose 35% due to inflation between 2022 and 2023.
It wasn’t immediately clear if Wendy’s prices will fluctuate by more than $1 come next year.
Represenatives for Wendy’s — which touts more than 6,000 locations nationwide — did not immediately respond to The Post’s request for comment.
Wendy’s is investing $20 million in digital menu boards to be able to update its prices at a moment’s notice. Wendyâs
The imminent new pricing model is a risky one, considering a survey by software company Capterra found that 52% of consumers believe dynamic pricing in restaurants is price gouging, Daily Mail reported.
Such price changes — also known as surge pricing — was implemented years ago by popular rideshare apps like Uber and Lyft as well as airlines.
The concept at rideshare companies adjusts prices on a moment’s notice, such as when it rains.
Wendy’s new CEO Kirk Tanner announced the imminent dynamic picing model during a call with investors earlier this month. Wendy’s
During a rush-hour rainstorm in New York City in September, commuters fumed that “slime ball” Uber and Lyft were charging nearly $100 for a five-mile ride.
Both Uber and Lyft had said at the time that prices of rides had been capped in anticipation of the storm, though neither company confirmed what limit had been set.
Even Uber’s own CEO was hit with sticker shock after a journalist took an Uber from downtown Manhattan to interview the company’s boss, Dara Khosrowshahi, on the West Side — and paid $51.69, including the driver’s tip, for the 2.95-mile trip.
An Uber user noted the ride-care company was trying to charge her more than $80 to commute 10 minutes to work during a rush-hour rainstorm last year.
Wired editor-at-large Steven Levy asked Khosrowshahi to guess the cost of his drup during a sitdown over the summer.
Khosrowshahi guessed a mere $20.
Levy informed the ride-share boss how far off he was and told him: “Five minutes earlier, the price was $20 higher,” which Khosrowshahi attributed to “surge pricing,” according to Levy.
Source link: https://nypost.com/2024/02/26/business/wendys-planning-surge-prices-based-on-fluctuating-demand/