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Wendy’s Backpedals On ‘Dynamic Pricing’: Slams Media

Wendy’s has back-pedalled furiously on plans announced earlier this week to introduce a new pricing scheme by the end of 2025. Fans cried bloody murder over ‘dynamic pricing’, after the chain’s new CEO unveiled it during an earnings conference call…

Digital Menu Board - © 2016 - PlusAMediaA giant 3-screen digital menu board in use at an Italian restaurant:
By PlusAMedia, whose web page enumerates the advantages of
the devices – with instant price changes at the top of the list.

Wendy’s new CEO Kirk Tanner had no idea what a poop-storm he was unleashing when he told shareholders and the business media about the chain’s new pricing plan. Called ‘dynamic pricing’, it sounded, according to Tanner’s description, just like UBER’s ‘surge pricing’. UBER’s plan is to charge more for deliveries during peak hours.

A hasty clarification

But Wendy’s clarified its position in a hurriedly issued mid-week statement:

“Earlier this month we issued […] an update on investments we are making in our digital business. One initiative is digital menuboards, which are being added to US Company-operated restaurants. We said these menuboards would give us more flexibility to change the display of featured items.”

Wendy’s implies we – the media and the fans – were to blame for the furor:

“This was misconstrued in some media reports as an intent to raise prices when demand is highest at our restaurants. We have no plans to do that and would not raise prices when our customers are visiting us most.”

And the chain adds a rather vague commitment about offering discounts and ‘specials’ at various times of the day:

“Digital menuboards could allow us to change the menu offerings at different times of day, and offer discounts and value offers to our customers more easily, particularly in the slower times of day.”

But what about the pricing thing?

That was the raspy, Shakespearean ‘rub’ in the contentious situation. And the statement doesn’t even approach the subject. That, alone, indicates a clear intent to misdirect us all away from the real issue. The potential for price diddling.

The statement promised that Wendy’s, “would not raise prices when our customers are visiting us most.” But it didn’t say what it might do. Or whether it might implement surge pricing in the future. Never say never.

So much haze…

The Wendy’s ‘defense’ is the haziest corporate position statement I’ve ever read.

One thing that particularly bothers me is, while they promise not to practice classic ‘surge pricing’ at peak times, they are not ruling out any other price tap-dancing they might attempt, “…particularly in the slower times of day.”

My take

Whatever Wendy’s is planning to do when the new digital menu boards come online, they will have at their fingertips the means to implement surge pricing and other potentially nefarious tactics anytime in the future they choose to.

And I take personal offense at Wendy’s suggestion that I, as a journalist, or their fans are to blame for ‘misconstruing’ the intent of the dynamic pricing plan. The only one to lay blame on is their green, new CEO. Who failed to chose his words carefully enough. It was up to him to make the message clear. And there was as a lot riding on that. But he failed. And the floodgates of consumer outrage burst open.

Also… We should all beware of the form of the Wendy’s ‘statement. It’s terse, clinical in tone, and reeks of a heavy edit by the company’s legal department. I reads like the small print in an apartment lease. And, unlike the straightforward, first-person statements by Tanner during the conference call, the statement positions itself at the opposite end of the information transparency continuum. It’s ‘signed’ by no one, and no officer of the company takes responsibility for it.

It is a craven, cowardly, even fearful response to the tsunami of consumer outrage that Tanner’s conference call comments triggered. We in the media, and consumers can take some comfort and satisfaction that Wendy’s ‘people’ are hiding under a rock – even as they blame us for the whole ‘miscostruence’.

Readers should not ‘misconstrue’ Wendy’s backpedal statement as only a clarification of the company’s position on ‘dynamic pricing’. It’s also, in a very real sense, an attempt to deflect blame from their highly touted new CEO. And, of course, to deflect blame for our anger and resentment from the company as a whole. For a service-based company like a Fast Food chain, image is everything!

~ Maggie J.