Surge Pricing Is Coming to More Menus Near You | Hacker News Reader

Surge Pricing Is Coming to More Menus Near You

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24 pointsimpish920845 comments

This is just one step towards getting consumers to accept what they really want to impose on us: prices that change according to the customer (https://link.springer.com/article/10.1057/s41272-019-00224-3)

Never knowing how much something will cost you, and accepting that the price you pay will be different than the price that others pay for the same item. Once we've accepted this, it'll be be much easier to get to us to accept discriminatory pricing.

Go out of your way to reject this now, or you will absolutely pay for it later.

I remember in econ101 the professor showed the supply demand curve graph and explained consumer surplus and how it was inefficient because there were consumers willing to pay more but the supplier had to set a single, optimal price.

The professor went on for a few minutes on how dynamic pricing per consumer would maybe be possible one day to realize this and how much more money would make. But he said ultimately it wasn’t fair and he was glad it was “impossible.”

So basically how pricing existed since the dawn of time until the creation of uniform pricing in the 1870s? What's old is new again.

In the 1870s they couldn't force you to use their app to see a menu, look up how much money you have in the bank, then have that app show you prices according to how much money you have. Why shouldn't a loaf of bread coast a percentage of your income? Get a new job that pays you 20% more, all your prices just go up by 20%.

There's a certain narrative closure that this technology pushes capitalism across the finish line of "from each according to their ability, to each according to their need."

And that’s why I now pack a lunch. $20 per meal is a bit too rich for my upper middle class blood, and it also isn’t as healthy.

Wait till your grocery store starts surge pricing.

I am lucky to live in a country where there are always at least 3 supermarkets in walking distance so they are desperately competing with each-other.

There are also 3 fast food joints within walking distance of a Wendy's or this BBQ joint in San Diego. "Competition exists" doesn't seem to be a be all end all driver for the pricing.

Interestingly, this isn't that different than restaurants offering weekday lunch specials, or happy hour, or other types of deals to draw more traffic during typically slow periods.

Although the inverse of increasing prices due to demand does appear to be new.

This might be received much better if it were billed as "ad-hoc deals" with the max price being the regular price, and deals being created by their point-of-sale system to account for unutilized bandwidth, and even inventory (the system can create specials on items which have ingredients that are nearing end of life, or which the restaurant's supplier itself put on special)

Calling it "surge pricing" seems like a way to just piss people off

Except what these places don't want to do is tell you the "max price" because then people will compare against that and give them grief. What they want to do is hide the max price so you never know what it is.

Personally, I hope these companies keep doing this. Once you get enough pissed off people, you'll get a law banning this crap.

Yeah I think if the prices are predictable it would be less of an issue, but if it’s based on oscillations in demand, then you can’t know in advance if you’re going to pay normal or extra pricing.

I've been hearing that you have to use an app to get reasonable prices at fast food restaurants anymore.

Yesterday, I tried the Wendy's app. A Dave's single cheeseburger that listed for $6.49 (in the app) had a special offer of $1.00 in the app. I ordered it as an experiment and sure enough, that was the price when I got it in the drive-thru.

McDonald's had deals in their app but they were conditioned on buying more - get X for $1 if you buy Y. That seems like a more sound approach for the restaurant. I appreciated the opportunity to get just one fast food item, though.

I think the app prices are updated daily, perhaps weekly. It's not a reach for them to be updated a lot more frequently with that restaurant's flow.

I feel the solution here is to say all price increases (for any service) must be announced at least 2 weeks in advance, and you cannot increases prices more than once a week.

So you don’t say “you can’t surge prices in these markets, or these conditions”, you just make it so surge pricing (or as it used to be called “price gouging”) is not a viable strategy. You leave open the ability to charge more in times of generally high demand but people know ahead of time, and can schedule around that, and there’s no risk of the standard emergency/disaster gouging Uber and co are so fond of.

This will also stop the gas company BS where there’s a minor disruption and they use that as an excuse to instantly increase fuel prices.

This would be tougher on smaller restaurants, which can't buy raw materials in bulk, and are often subject to local market conditions surrounding produce, etc.

Do your local restaurants already change prices more than once a week without notice? If not, how is limiting to that impactful to them? Can't say I've ever seen a local restaurant adjust food prices on the fly based on the price of their last purchase but maybe things are different elsewhere.

Their suppliers wouldn’t be able to subject them to surge pricing either.

That said all the articles about restaurants considering surge prices have been nationwide chains, so not exactly the group that lacks pricing control.

Restaurants do not provide a crucial service. You can cook at home. I don't think the government needs to interfere.

Out of curiosity is that view limited to retail pricing laws or does it extend other types of regulation as well? If it doesn't extend what makes pricing regulation different from other regulation in terms of consumer protection, in your view?

Why is this new? My local restaurant has "half priced burger night" on Tuesdays. Happy hour is a favorite solution for getting people into the place early.

Because you know it’s Tuesday night and that the price is half off.

This way you won’t know the price until you show up so it’s hard to predict the price until you have some sunk costs.

If that's what it was going to be, that's what they'd call it.

We've entered a new era. Dune costs more to see at the theater near me than other movies. The default movies are not discounted. Dune just has an extra fee for being popular.

> We've entered a new era. Dune costs more to see at the theater near me than other movies. The default movies are not discounted. Dune just has an extra fee for being popular.

That sounds totally reasonable to me.

Dune 2 is almost 3 hours long. Why shouldn’t it cost more than a 90 minute romcom?

You're suggesting we should pay by the minute? I think I'll just keep not going to movie theaters.

if a theater can show a movie half as many times as usual it would make sense to rise prices.

At the limit if a movie came out to be 12 hours long then it would objectively cost the theater more to show (both in opportunity cost and direct costs)

I'm told that theaters make their money on food. As long as people are there eating popcorn and drinking soda they profit so it doesn't matter who those people are or what they are seeing. It's not as if theaters pay more for heat, water, and air conditioning if it's the same asses in seats vs new ones.

On other hand you could theoretically fit double the number of people if not more in 1 hour film vs 3 hour film.. And they likely would buy almost same amount of drinks and popcorn.

I know right? It's just as logical to frame this as reduced pricing at off-peak times, but I guess that's not so sensational.

Nevermind that many people would be happy to pay a little bit extra to avoid waiting during peak times.

you would think the companies rolling these out would have that level of sense from the get go. turns out, they didn’t, and described it in the sensational way.

“dynamic pricing and daypart offerings.”

that’s the ceo of wendys - not the media. sure, they tried to awkwardly correct the optics.

there may be upsides, but to act like this is purely media sensationalism is to sound quite a bit like jumping too far in the other direction. the why isn’t terribly important. just like the ceo, the optics are off.

The optics are price being more reflective of supply and demand. Doesn’t more accurate pricing ensure more optimal allocation of resources? I don’t see why that would be a bad thing.

The optics to the average person are "I'm getting ripped off right after prices already went up way too much with inflation". What you're talking about is the reality.

The optics to the average person that "I'm getting a bargain right after prices already went up way too much due to inflation".

If they called it something along the lines of an off hours discount that's what the optics would be. Clearly the fact that people are talking about this in a generally negative way shows that they aren't seeing it as getting a bargain.

> Clearly the fact that people are talking about this in a generally negative way shows that they aren't seeing it as getting a bargain.

That's because the same companies who have been jacking up prices for no reason sure as hell aren't looking to do us any favors now. They'll use this to extract as much money from us as they can think they can get away and if we complain about their prices they will blame us for not rearranging our lives to match their random schedules.

I guess that is true. To me, I think people in the service business, especially back of house in restaurants, have long been getting shafted in terms of pay and quality of life having to work evenings, nights, and weekends for low pay.

So prices going up means they must be getting increased pay (because the restaurant business is so low profit margin).

> So prices going up means they must be getting increased pay

sorry, is this sarcasm?

edit: to clarify, there must be assumptions to see price hikes as benefitting the bottom. even to view meager increases as improvement is disingenuous if what goes down is a fraction of what goes up.

you’re confusing optics with facts.

the most objective statement of fact can result in absolutely horrible optics.

In addition to representing basic supply and demand principles, this sounds like a good way to mitigate the worker shortages than many restaurants have faced recently. You need enough workers to meet peak demand. This serves to lower peak demand by spreading it out.

No one is going to rearrange their life according to when some burger joint has lower prices. You'll never know when that will be anyway. Many people have zero say over when their employers allow them to eat lunch in the first place. People eat when they have time, or (less often) when they are hungry and none of those things take into account price.

At best this will drive business to restaurants that aren't playing games with their prices.

Well I wouldn’t classify choosing to go to a restaurant during off-peak hours as rearranging my life and I think I have a fairly good idea of what times are off-peak for most restaurants.

Instead of complaining here in honor of this surge pricing idea maybe someone on X/Twitter/Reddit/Threads should get “throw a brick through a Wendy’s window” trending on their platform of choice.

Dynamic pricing has always existed. To take an obvious example: Someone on a tight budget will take the time to collect and use coupons. Someone with a comfortable income will not. Same product, two different prices.

They are just getting much more obvious about it.

Wonder how long it will be until I see "market price" at a fast food restaurant.

And I'm going to fewer restaurants! Maybe it's a good thing that companies are trying to squeeze blood from a stone. It makes it much easier to walk away from convenient, but bad habits.

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