It was a weird week last week at Wendy’s. First they were talking about introducing dynamic pricing, only to walk it back later: Wendy’s clarifies no surge pricing after CEO ‘dynamic pricing’ comment.
Was this a weird way to get attention? Possibly. Or possibly some executive had half an idea this was a good idea before the deluge or outrage hit them. (Recommending surge pricing after consumers have been complaining for months and months about food price inflation is a great example of not reading the room. Not to mention people are already annoyed at the cost of fast food these days.)
Look if Wendy’s wants to go with surge pricing, I say good luck with that. (Also good luck with saying “no it’s not surge pricing, it’s dynamic pricing”.) Unlike Uber in bad weather, they don’t have a lock on meals. Anyone with a little knowledge of economics knows people will just substitute them out with other fast food (or a brown bag lunch). Wendy’s does not make Giffen goods. All they are going to achieve is angering their customers.
For a good guide to dynamic pricing, I recommend this. It can be done successfully and lead to greater profit, but you are playing with fire if you are thinking of using it for your business.
Smart People I Know 