How to Implement Dynamic Pricing Without Alienating Guests
Dynamic pricing was a hot topic at the 25th European Foodservice Summit in Amsterdam. Philipp Laqué, Managing Director at Revenue Management Solutions, discussed the opportunities and challenges of this pricing strategy, while Joaquín Capel Alcaraz offered the operator’s perspective.
“Dynamic pricing is far more than traditional discounts like Happy Hours,” Laqué emphasized from the outset. It involves the flexible adjustment of prices in real time—an approach that is still new but promising in the hospitality industry. “In a highly competitive market environment, this strategy offers tremendous opportunities to increase profitability,” Laqué highlighted. However, he also warned of potential risks: “If customers perceive fluctuating prices as unfair, it can undermine trust in a lasting way.”
A recent study from market researchers at Revenue Management Solutions emphasized the psychological dimensions of the model. Participants reminded of dynamic pricing systems like those used in airline bookings exhibited higher price sensitivity. The result: They responded more consciously to pricing information and made more rational purchasing decisions. According to Laqué, transparency and clear communication are essential for gaining acceptance.
Responding flexibly to demand
From a business perspective, Joaquín Capel Alcaraz shared insights into the potential of dynamic pricing. The CEO of the Spanish Grupo Con Fuego described how his company—operator of brands like SteakBurger and Superchulo—leverages this strategy. “The pandemic presented us with significant challenges,” said Alcaraz. “By implementing dynamic pricing, we were able not only to secure our profitability but also respond flexibly to market demand.”
With 26 restaurants primarily in Madrid, Grupo Con Fuego reports significant successes: a sales increase of 11% and an EBITDA growth of 10% underscore the effectiveness of their measures. Alcaraz pointed to technical tools like QR codes, through which price changes are communicated in real time. Simultaneously, the group relies on a positive narrative and a loyalty program to foster acceptance among both local and tourist customers.
Both experts agreed: Dynamic pricing offers great potential for revenue increases but requires a sensitive approach. The key to success lies in clear and transparent communication that builds trust without compromising customer satisfaction. In a time when adaptability becomes a success factor, dynamic pricing could become a crucial competitive advantage for hospitality businesses.
