https://www.yahoo.com/news/wendys-says-it-wont-use-surge-pricing-for-burgers-after-announcing-dynamic-pricing-whats-the-difference-between-the-2-175039236.html

Just curious what people think...as the reaction to the restaurant has been universal condemnation, pretty much.

 

Especially this idea of a nefarious AI/algorithm in real-time changing prices on a display board or "upselling" in order to get customers to spend more money (obviously a health concern) buying more than they need or at least should eat in various combo meals?

The White Sox and numerous major league teams (and all across the Big 4 sports, for that matter) utilize similar marketing tactics but there's not THAT much organized pushback. 

 

I suppose the obvious answer is that Wendy's has significant competition, whereas sports teams do have competition in the entertainment/leisure spending niche...but sports fans are much more loyal/community pride etc., to their favorite teams than consumers.

Trying to imagine if similar strategies by let's say Apple or Nike or Starbucks, where there's considerable brand loyalty, would work nearly as well.  Probably not.

I know you're the king of this but it's apples to oranges. A chain restaurant is successful largely because it fills the role of dependable meal at a fixed price. I'd assume the 80/20 rule applies to fast food, 80% of your biz comes from 20% of your customers. Those are the people getting Wendy's every single day, the loyalists. Those people are coming because they know they are going to get the same item, at the same price, every day. They don't want to see a bus full of HS kids in front of them at the drive through and learn they are gonna be paying 2x for a frosty.

Tickets? Tickets are not only not a physical commodity, they are purely a luxury, whereas where you eat lunch is mostly not, at least for 95% of the population.

I don't think I've walked into a Wendy's and had more than one person ahead of me. Pretty sure if you start charging me an extra buck for my baconnator at 5pm I'll finally have the motivation I need to get my s%*# together and go home and make a salad. Wendy's, you played yourself.

In the list of things to be upset with the White Sox about...remember, this goes back to 2010/11, when they had a relatively successful season (26-5 stretch in the summer kept them in competition) and then marketing the acquisition of Adam Dunn the following season...this is probably not in the Top 25 gripes or complaints, but it did seem at the time they were gouging their customers over Cubs/Yankees/Red Sox, etc. games at that time.  

It made sense, in that the afterglow of the World Series championship was falling off considerably after the 2006/2007 and 2009 seasons (positive vibes used to last a full five years, recently closer to 3-4 years of benefit from that type of post-season run).

 

https://www.espn.co.uk/mlb/news/story?id=5618359

2 minutes ago, caulfield12 said:

In the list of things to be upset with the White Sox about...remember, this goes back to 2010/11, when they had a relatively successful season (26-5 stretch in the summer kept them in competition) and then marketing the acquisition of Adam Dunn the following season...this is probably not in the Top 25 gripes or complaints, but it did seem at the time they were gouging their customers over Cubs/Yankees/Red Sox, etc. games at that time.  

It made sense, in that the afterglow of the World Series championship was falling off considerably after the 2006/2007 and 2009 seasons (positive vibes used to last a full five years, recently closer to 3-4 years of benefit from that type of post-season run).

 

https://www.espn.co.uk/mlb/news/story?id=5618359

That was funny when the spokesman was like "it's this really cool algorithm that takes all these things into account" and then in the next breath basically said they're just using the secondary market data (reading between the lines).

Of course unsold tickets (even direct from the club) should be sold at the highest price possible on gameday and the days prior. It's just now the club gets the same price the guy in the lot and now the guys on vividseats or stubhub do, or slightly better given there's no skimming.

21 minutes ago, mac9001 said:

I don't think I've walked into a Wendy's and had more than one person ahead of me. Pretty sure if you start charging me an extra buck for my baconnator at 5pm I'll finally have the motivation I need to get my s%*# together and go home and make a salad. Wendy's, you played yourself.

Imagine if you were to actually see on screen the price increasing as you were in the process of ordering.

I think a good 50% of customers (especially if the restaurant wasn't that busy) would walk out in frustration.   Of course, driving away or out of the drive through might not be as easy in a crowded line, but I could just imagine "road rage" drive-in episodes with people getting angered by the price hikes and abandoning their place in line...getting upset when someone won't move or back up or can't possibly backup to accommodate them.

 

But yeah, you're right, great motivational technique to get people to abandon the typical fast food diet.

Here in China we're going through a period of deflation (especially real estate prices), while restaurants like McDonald's are starting to get some serious pushback for price hikes and also "upselling" all the online menu options (mostly for delivery) by making it almost impossible to find a combo with Big Mac/fries/Coke.  They keep adding chicken wings or pies or other stuff you probably don't want, and it takes ages hunting through apps to find exactly what you want.

Edited March 1, 20242 yr by caulfield12

Is this like the MLS teams that jacked up ticket prices when Messi came to town? 

1 hour ago, cuban_sammiches said:

Is this like the MLS teams that jacked up ticket prices when Messi came to town? 

Even worse, when he came to Hong Kong, he and Suarez didn't even play (or talk to the crowd to explain or even acknowledge them) at all when people had paid $100's of dollars for tickets.   That didn't go over particularly well.

Lmao this is peak caulfield. I love it. 

Supply and demand gets ugly for consumers. 

I think one reason we see different reactions is no one is scalping a Frostie. 

1 minute ago, Texsox said:

Supply and demand gets ugly for consumers. 

I think one reason we see different reactions is no one is scalping a Frostie. 

Well, the example would be a busload of school kids on a class trip showing up and flooding the restaurant on a hot late May  day with Frosty prices instantly doubling as soon as they walked in to order.

27 minutes ago, caulfield12 said:

Well, the example would be a busload of school kids on a class trip showing up and flooding the restaurant on a hot late May  day with Frosty prices instantly doubling as soon as they walked in to order.

Or the price dropping

Just have lunch at Bob Evans on Thursday and again on Sunday to see dynamic pricing. How is this different? Will Wendy’s AI work in real time factoring in weather, special events in town, etc.?  I’d be down with $1 burgers when storms roll through town. Maybe the same for game tickets?

On 2/29/2024 at 10:24 PM, ron883 said:

Lmao this is peak caulfield. I love it. 

In a million years, no human being would link these two topics together.

The big difference is that Wendy’s is upselling for the exact same product. There’s a massive difference between a team like the Royals and a team like Yankees coming into the home park. 

And the Sox using one pricing model all year.  They aren't changing it upwards on any basis. 

Tanner’s mention of dynamic pricing led observers to imagine the chain jacking up the cost of ice-cold Frostys on parched summer afternoons, or boosting Baconator bills during the lunch rush.

As backlash built, Wendy’s was forced to issue a statement, saying that the media had misconstrued the intent of its dynamic pricing plans as focused on raising prices during peak demand times. Instead, the chain maintained, the digital menuboards would allow it to “offer discounts and value offers to our customers more easily, particularly in the slower times of day.”

 

That may have soothed the masses a little. But the reality is that implementing “dynamic discounts,” as one might refer to them, instead of surge pricing, is simply another way for a business to engage in price discrimination — the economic term for charging different costs to people who have different demand profiles in order to extract maximum profit.

Yes, the stray customer who wants a Loaded Nacho Chicken Sandwich at 11 a.m. might benefit from a few cents off. But realistically, such dynamic discounts could just be used to soften the impact of future price increases.

And it’s easy to imagine how that might backfire, given how fluidly people can shift gears from chain to chain if they feel like they’re not getting their money’s worth. Discounts at odd hours might pull in some marginal customers, but not knowing how much of a hit your wallet might take when you’re craving a Dave’s Double adds a layer of unnecessary anxiety to a world that already frequently feels like it’s on the brink of the existential abyss, which could push away customers more generally.

 

https://www.cnn.com/2024/03/01/opinions/wendys-menu-dynamic-pricing-yang/index.html

Sir, this is a SoxTalk

Even Wendy's is more exciting than the White Sox and Grifol.

What does a surge look like at Wendy's?

$1 White Sox Tickets and Free Parking = Surge Pricing.

https://www.mlb.com/press-release/press-release-white-sox-lower-level-tickets-free-parking-092823

Edited March 3, 20242 yr by South Side Hit Men

12 minutes ago, South Side Hit Men said:

$1 White Sox Tickets and Free Parking = Surge Pricing.

https://www.mlb.com/press-release/press-release-white-sox-lower-level-tickets-free-parking-092823

That just diminishes the value of your product so much that nobody will want to pay legit prices again in the future if the team is ever decent again.

This might work for A ball teams....but not so much major leagues.

Would have worked a lot better in 2022 and 2023 as well...before so many fans gave up out of frustration and started to say things like I wouldn't go even if they gave away tickets for free.

Edited March 3, 20242 yr by caulfield12

A better comparison would've been gas stations. They've been using "dynamic pricing" for decades.

I can drive by a station in the morning and it's one price and then in the afternoon it's a different price. You never really know exactly how much you are going to pay.

People grumble about it but what are we supposed to do? Just not buy gas?