Wendy's: It's 'Dynamic Pricing,' Not 'Surge Pricing'

UPDATE Feb 28, 2024 10:10 AM CST

Wendy's is pushing back at reports on its plans to use dynamic pricing, where the cost of menu items changes depending on demand. "To clarify, Wendy's will not implement surge pricing," the company said in a Tuesday statement, per the AP. "We didn't use that phrase, nor do we plan to implement that practice." The statement notes that the miscommunication came about because the chain had mentioned digital menu boards that would offer display flexibility, including by allowing the displays to advertise lower prices when things get slow. "This was misconstrued in some media reports as an intent to raise prices when demand is highest at our restaurants," the statement notes, per NBC News. "We have no plans to do that and would not raise prices when our customers are visiting us most."

Feb 28, 2024 2:30 AM CST

Surge pricing is coming to Wendy's. The fast-food chain revealed in a recent earnings call that it will start testing dynamic pricing as soon as next year, the New York Times reports. When rolled out, digital menu boards will reflect the current prices of menu items, and those prices will go up and down as demand goes up and down. USA Today, one of multiple media outlets referring to the news as an "Uber-style" move, notes that variable pricing "is fast becoming the norm." While certain industries, like the hotel and airline industries, are expected to price offerings differently based on demand, consumers aren't quite as used to other industries utilizing the practice.

They do, however; prices on Amazon and other online retailers, for example, fluctuate due to algorithms and artificial intelligence that track interest in the product, prices elsewhere online, and other information. And mobile apps make dynamic pricing even easier by utilizing different coupons or offers for different customers. "A lot of this stuff is already happening even if you don't realize that it is happening. If you have the Starbucks app and I have the Starbucks app, we probably have different offers," one expert explains. "We might not be in the drive-thru and they just increased the prices, but we are already paying different prices for the same products." (More Wendy's stories.)