Wendy’s new president and CEO Kirk Tanner revealed plans to increase company profits, including by investing in digital menu boards that display dynamic pricing that changes throughout the day, reports Food & Wine.
“We are planning to invest approximately $20 million to roll out digital menu boards to all U.S. company-operated restaurants by the end of 2025,” Tanner said in a Feb. 15 earnings call. Tanner added that Wendy’s will invest an additional $10 million over two years to enhance its global system, help upsell other menu items, and improve order accuracy.
As part of the initiative, the chain will also test “AI-enabled menu changes and suggestive selling” based on factors like weather, according to the report.
The dynamic pricing model has been likened to “surge pricing” strategies common on rideshare apps like Uber and Lyft.
“Dynamic pricing can allow Wendy's to be competitive and flexible with pricing, motivate customers to visit, and provide them with the food they love at a great value. We will test a number of features that we think will provide an enhanced customer and crew experience," said a spokesperson for Wendy’s.
Caleb Silver, editor in chief of financial media company Investopedia, said the strategy is risky but could help the fast food chain.
“Wendy’s foray into dynamic pricing is a bold experiment that could help the chain be more efficient and ultimately profitable if it works," said Silver. “But, it does run the risk of angering and losing customers since they actually have many choices, unlike the rideshare industry.” Full Story
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