By Tonya Garcia | Bloomberg
No, Wendy’s Co. says, there won’t be surge pricing on cheeseburgers and Frostys.
The fast-food chain has moved to clarify comments on its fourth-quarter earnings call earlier this month about an upcoming dynamic pricing test. The program could be in effect by 2025 as part of a $20 million investment in digital menu boards for US company-operated stores. The plan offers Wendy’s “more flexibility” to display featured items, but the company is now saying that it doesn’t intend to use that to hike prices at busy times.
During a conference call earlier this month, Wendy’s CEO Kirk Tanner said that the Dublin, Ohio-based burger chain will start testing dynamic pricing, also known as surge pricing, as early as next year.
“Beginning as early as 2025, we will begin testing more enhanced features like dynamic pricing and daypart offerings, along with AI-enabled menu changes and suggestive selling,” he said. “As we continue to show the benefit of this technology in our company-operated restaurants, franchisee interest in digital menu boards should increase, further supporting sales and profit growth across the system.”
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“We have no plans to do that and would not raise prices when our customers are visiting us most,” Wendy’s said in a statement on its website Tuesday. “Any features we may test in the future would be designed to benefit our customers and restaurant crew members.”
Wendy’s came under fire on social media after Tanner’s comments, which some interpreted as calling for Uber-like surge pricing when demand is high.
Tanner, a longtime PepsiCo executive, became Wendy’s CEO earlier this month.
Wendy’s isn’t the first burger chain to use this menu technology. As far back as 2015, McDonald’s Corp. introduced digital menu boards that make item changes and promotions easier.
To be sure, companies can use the technology to raise prices. But Wendy’s says it’s focused on value, and digital menu boards would allow the company to easily “offer discounts” to its customers, “particularly in the slower times of day.”
Bloomberg has reached out to Wendy’s for further comment.
