Dublin, Ohio – Wendy’s, a popular fast-food chain, is venturing into a new pricing strategy that involves adjusting menu prices based on demand throughout the day. This move, inspired by the practices of companies in the ride-sharing and entertainment industries, has stirred up some controversy among customers and industry observers.
The CEO of Wendy’s, Kirk Tanner, announced during a recent conference call that the company would be exploring dynamic pricing, also known as surge pricing, starting in 2025. This initiative is part of a larger plan to introduce technological enhancements like AI-driven menu changes and personalized suggestions to improve the overall customer experience.
In preparation for these changes, Wendy’s is set to invest around $20 million to implement digital menu boards across all its company-operated restaurants in the United States by the end of 2025. An additional $10 million will be allocated for global digital menu enhancements over the next two years.
Tanner, formerly of PepsiCo, took over as CEO of Wendy’s following Todd Penegor’s tenure. Under Penegor’s leadership, Wendy’s underwent a restructuring aimed at streamlining decision-making processes and expanding internationally, with approximately 7,000 restaurants operating worldwide.
Despite these strategic moves, Wendy’s decision to adopt surge pricing sparked backlash, with some customers expressing their displeasure on social media platforms. Criticisms ranged from concerns about predatory pricing to comparisons with Uber’s pricing model. The negative reactions led to a slight decrease in Wendy’s stock value in the market.
As Wendy’s prepares to usher in these changes to its pricing strategy and digital enhancements, the company faces the challenge of navigating customer perceptions and expectations in a competitive fast-food landscape. The implementation of surge pricing may prove to be a pivotal moment for Wendy’s as it seeks to innovate and adapt to evolving consumer preferences.