OnDemand WTP Pricing Research

What Is Restaurant ‘Surge Pricing,’ and Should You Be Scared? | Food & Wine

The Uber era has marked several shifts in culture, from the proliferation of AUX cord literacy to a decreased willingness to ride public transit at 3 a.m. even when it’s quicker. The San Francisco start-up’s business model, in particular, has spread far beyond the realm of the service economy and transportation. Take surge pricing. Restaurants have begun experimenting with the payment system, which is used by companies like Uber and Lyft to charge riders more during busier times of the day and less when the roads are clearer.

In early 2018, the buzzy London restaurant Bob Bob Ricard announced it would begin experimenting with a similar model, which was really just a glorified early bird special—25% lower prices during off-peak seatings (like Monday lunch) and 15% off “mid-peak” seatings (dinner on Tuesdays and Sundays, for example.)

And yet, the notion of paying a premium price for premium time slots continues to cause concern among diners who are worried this will become the norm. (Last year, the Bob Bob Ricard announcement was picked up by news outlets around the world.) And an informal survey of my fellow staffers resulted in a resounding response of: “We don’t like this one bit.”

Here’s what you need to know.

Is surge pricing really new?
As Bob Bob Ricard owner and founder Leonid Shutov pointed out to Bloomberg, timing-dependent price-tweaking has been standard practice across many industries for years. “The idea just came from looking at how the rest of the world functions,” he said. “Airlines wouldn’t be able to exist, the business model wouldn’t work unless you could balance supply and demand. Everything that we have taken that is widely accepted in the modern economy and applied to restaurants, seems to have worked.”

Read complete article here:

What Is Restaurant ‘Surge Pricing,’ and Should You Be Scared? | Food & Wine.

Post a Comment

WP-SpamFree by Pole Position Marketing