Status: 25.09.2023, 18:30 p.m.
By: Markus Hofstetter
In the UK, a pub operator has introduced a dynamic pricing model. Guests are not thrilled.
London - The restaurant industry in the UK has fallen on hard times – and even harder ones ahead of it. In recent years, the number of well-known pubs has declined, and there is even talk of pubs dying. In 2022, 512 pubs in the kingdom closed their doors forever, almost double the number in 2021 when 280 pubs went out of business. This year it continues, in the second quarter 230 pubs have closed.
Experts see the reasons for this development in the falling disposable incomes of consumers as well as in the increased energy, personnel and wholesale prices. Above all, the increased prices have prompted the largest pub operator to take an unusual step.
British pub chain introduces dynamic pricing: beer costs more at peak times
According to a report in the Daily Telegraph, visitors to 800 of the 4500 pubs of the Stonegate Group have to dig deeper into their pockets for a glass of beer - but only at peak times. Then a pint costs 5.70 pounds (6.55 euros), 20 pence more than in normal times. Dynamic pricing at Stonegate is not entirely new. According to the Guardian, prices have already been temporarily raised in the past during major events such as the World Cup.
In pubs of a British catering company, a beer costs more © at a wedding Wirestock/imago
This brings a business practice to the UK restaurant industry that is already commonplace in other industries: dynamic pricing. Pricing models that react to fluctuations in supply and demand already exist in the hotel industry, airline tickets or ride-hailing services such as Uber, but also among online retailers such as Amazon. The goal is to increase sales. This is not only possible through higher prices. If demand is low, sales can also be boosted by lowering prices.
British pub chain introduces dynamic prices: special offers to reconcile
A spokesperson for Stonegate told the Daily Telegraph that the company "regularly reviews pricing to get a grip on costs, but also to ensure that we offer our guests good value for money". This flexibility could lead to prices in selected pubs and bars occasionally rising slightly because the cost of additional staff or permits, for example for additional bouncers, has risen.
But there is also another side to the strategy. "Our dynamic pricing allows us to offer guests a range of special offers such as happy hours, two-for-one cocktails and discounts on food and beverages on different days of the week at different times," explains the company spokesperson.
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British pub chain introduces dynamic pricing: guests aren't thrilled
In order not to offend the guests, they will now be informed of the change with a "polite note" in the Stonegate pubs. It states that prices need to be increased to cover additional staffing costs, more doormen, extra cleaning, glass washing, and "compliance with licensing requirements."
Pub-goers don't seem to be exactly thrilled with the new Stonegate pricing model. "If they continue with this, there won't be a full Stonegate pub anymore," Bigheadcomm writes on X, formerly Twitter. "I mean. How you @Stonegate_Group destroy your already struggling business. You are completely dishonest with your customers and continue to rip them off," Skibum999 writes.