Well, if they were going to drop prices in less busy times this could be a good thing. But we all know they are probably only going to raise prices during busy times. Fast food has already become over priced. You can go to an actual restaurant for a few bucks more these days. Not that I eat at Wendy's all that often now but I foresee it being never if they do this. After all, I'm pretty sure lunch is going to be a busy time. I'm not so sure this won't backfire on them.
Lowering prices during non-peak hours is something I noticed was not mentioned by their CEO, nor any article I sourced on this. Only raising prices. Also, no one mentioned staff getting a boost in pay during what the AI would deem suitable for surge pricing.
I have been seeing some news clips that the CEO is backpedaling now, saying they never said they would raise prices and that they never said anything about "surge" prices.
Others are saying the CEO has said they won't be implementing the AI price adjustments now, just the menu screens to help with busy times so people can order rather than wait in line.
It is a PR nightmare for them already and I am here for it. I have my popcorn ready.
On one hand, price adjustment is a rational market response to supply and demand. On the other hand, this shift throughout the course of even a single day sounds like a logistical nightmare that will only frustrate the customers. Buyers want stability and predictability. Fast food is not an industry like Uber. The employees are not paid better during busy times. Maybe I should charge Wendy's $100,000 for this obvious bit of advice.
I agree, it is a natural thing to adjust for supply and demand but imagine if there was no backlash on this and stores like Walmart or Costco decided to implement a similar AI managed pricing system. You could see one price when in your cart but see another by the time you reached check out. It would be quite a show as people flipped out at the cashiers.
The thing Wendy's is missing here when trying to adopt an "Uber like" pricing schedule is, the Uber drivers do see some of that in a slight pay increase. It is not proportional though which is still unfair but the drivers do see some of the increased price customers pay during peak time. Wendy's has been absolutely silent on the employees seeing any pay increase during peak time.
Since Uber is an on-demand service, and the driver availability can fluctuate moment-by-moment, their pricing serves as an incentive.
Wendy's could change they pay scale to reward efficient work during peak hours, but otherwise, it makes no sense. The cost and availability of their food doesn't fluctuate moment to moment, so the disconnect in prices just doesn't make sense unless it goes to labor.
Nowever, as more and more states are changing labor laws and wages, and workers often demand higher pay as inflation pressures mount, and costs also rise due to inflation, I can see how the corporation might be looking for ways to boost earnings to meet those demands and pressures without the psychological effects of changing the "base price" of their food.
But even trying to make every excuse I can, I still don't believe this is a viable model. Customer backlash is likely to be severe.
I completely agree with you. I do not understand why fast food places do not adopt a floating price like most sit down places do. Whether it is called "early bird" or "brunch prices" I am surprised McDonald's, Burger King, etc have not adopted that model. Customers seem to have no problem with it with other food places.
Same for movie theaters. Want to save on that movie ticket? Go before X time of day. Again, it works and people are fine with it.
Maybe Wendy's and such will adop this model and have the AI handle price changes at set times of day. I cannot see them even thinking of going forward with fluctuating prices throughout the day based on busy level of the store, the weather, even down to the profile the AI has created on customers.
It is very clear that how the CEO has made this information available, it is already a PR nightmare. They are trying to back track now, even with the CEO saying he never said they would raise prices due to volume of orders, based on factors such as time or weather, etc.
That tells me the CEO is tone deaf and plans to implement this are still firmly in place and coming, just now it won't be as public.
Well, if they were going to drop prices in less busy times this could be a good thing. But we all know they are probably only going to raise prices during busy times. Fast food has already become over priced. You can go to an actual restaurant for a few bucks more these days. Not that I eat at Wendy's all that often now but I foresee it being never if they do this. After all, I'm pretty sure lunch is going to be a busy time. I'm not so sure this won't backfire on them.
Lowering prices during non-peak hours is something I noticed was not mentioned by their CEO, nor any article I sourced on this. Only raising prices. Also, no one mentioned staff getting a boost in pay during what the AI would deem suitable for surge pricing.
I have been seeing some news clips that the CEO is backpedaling now, saying they never said they would raise prices and that they never said anything about "surge" prices.
Others are saying the CEO has said they won't be implementing the AI price adjustments now, just the menu screens to help with busy times so people can order rather than wait in line.
It is a PR nightmare for them already and I am here for it. I have my popcorn ready.
And the memes have started...
OMG, fast food the new stock market 😂😂😂
On one hand, price adjustment is a rational market response to supply and demand. On the other hand, this shift throughout the course of even a single day sounds like a logistical nightmare that will only frustrate the customers. Buyers want stability and predictability. Fast food is not an industry like Uber. The employees are not paid better during busy times. Maybe I should charge Wendy's $100,000 for this obvious bit of advice.
I agree, it is a natural thing to adjust for supply and demand but imagine if there was no backlash on this and stores like Walmart or Costco decided to implement a similar AI managed pricing system. You could see one price when in your cart but see another by the time you reached check out. It would be quite a show as people flipped out at the cashiers.
The thing Wendy's is missing here when trying to adopt an "Uber like" pricing schedule is, the Uber drivers do see some of that in a slight pay increase. It is not proportional though which is still unfair but the drivers do see some of the increased price customers pay during peak time. Wendy's has been absolutely silent on the employees seeing any pay increase during peak time.
Since Uber is an on-demand service, and the driver availability can fluctuate moment-by-moment, their pricing serves as an incentive.
Wendy's could change they pay scale to reward efficient work during peak hours, but otherwise, it makes no sense. The cost and availability of their food doesn't fluctuate moment to moment, so the disconnect in prices just doesn't make sense unless it goes to labor.
Nowever, as more and more states are changing labor laws and wages, and workers often demand higher pay as inflation pressures mount, and costs also rise due to inflation, I can see how the corporation might be looking for ways to boost earnings to meet those demands and pressures without the psychological effects of changing the "base price" of their food.
But even trying to make every excuse I can, I still don't believe this is a viable model. Customer backlash is likely to be severe.
I completely agree with you. I do not understand why fast food places do not adopt a floating price like most sit down places do. Whether it is called "early bird" or "brunch prices" I am surprised McDonald's, Burger King, etc have not adopted that model. Customers seem to have no problem with it with other food places.
Same for movie theaters. Want to save on that movie ticket? Go before X time of day. Again, it works and people are fine with it.
Maybe Wendy's and such will adop this model and have the AI handle price changes at set times of day. I cannot see them even thinking of going forward with fluctuating prices throughout the day based on busy level of the store, the weather, even down to the profile the AI has created on customers.
It is very clear that how the CEO has made this information available, it is already a PR nightmare. They are trying to back track now, even with the CEO saying he never said they would raise prices due to volume of orders, based on factors such as time or weather, etc.
That tells me the CEO is tone deaf and plans to implement this are still firmly in place and coming, just now it won't be as public.