Surge Pricing Can Sour Diners’ Loyalty: Survey

In the face of soaring food expenses, labor costs and other economic factors, some restaurant owners are raising the cost of menu items depending on the time of day and demand – so called surge or dynamic pricing. But that move is a big turnoff for many diners, a new survey by POS software platform provider HungerRush has found.

“Coping with the recent $20 minimum wage in California alongside high national inflation poses significant challenges for restaurant owners,” said Bill Mitchell, Executive Chairman of HungerRush. “While raising prices may seem like a straightforward solution, it can negatively impact consumer loyalty. We’ve witnessed backlash against surge pricing models in the past, demonstrating the importance of preserving customer experience and loyalty.”

According to the survey, 64% of diners said they have a negative reaction to restaurants using surge and dynamic pricing. Moreover, 81% of diners surveyed said they would either stop going to a restaurant altogether or alter their dining hours to avoid prices surging during peak hours.

The survey was conducted in March 2024 of 1000 U.S. consumers 18 years and older to understand potential dining habits and preferences toward restaurants that use surge or dynamic pricing models.

Click here for more on HungerRush’s survey on surge pricing’s plusses and minuses.