Juicer enabled restaurants to adjust their prices in delivery apps depending on demand. | Photo: Shutterstock

Restaurant technology startup Juicer is abandoning its dynamic pricing product because the idea of ​​demand-based pricing has become too unpopular with consumers.

Ashwin Kamlani, co-founder and CEO of Juicer, said he noticed a change in the market earlier this year after Wendy’s announced it would test dynamic pricing in the drive-thru. The brief comment during a conference call sparked widespread backlash from consumers upset at the idea of ​​implementing “surge pricing” for burgers and fries.

Wendy’s eventually softened its original statement, saying it only wanted to offer discounts at certain times of the day, but the incident stoked fears among restaurants about the risks of dynamic pricing.

“We found that the more companies we surveyed, the more we heard, ‘I don’t want to be the next Wendy’s,'” Kamlani said.

Juicer’s software allowed restaurants to make automatic, incremental price changes on third-party delivery apps. When business was slow, prices would go down; when business was busy, they’d go up. The idea was to both generate additional revenue and spread demand more evenly throughout the day.

Kamlani is a vocal proponent of dynamic pricing, claiming it is effective for Juicer customers. He points to average revenue increases of 10 to 15 percent on delivery apps. He also said customers did not seem to mind the price fluctuations.

“But should we get involved in a business that is not considered consumer-friendly? Probably not,” he said. “We probably want to be on the right side of history here.”

(Read more: Dynamic pricing a controversial topic at the National Restaurant Association Show.)

Juicer, founded in 2021, had to consider other factors. As a startup that relies on venture capital, its runway is limited. “We didn’t have the luxury of waiting and continuing to burn money to maintain (dynamic pricing) to see if that would happen,” Kamlani said.

The company also had another, more promising, business area to focus on. Although dynamic pricing was the company’s core product, it found that restaurants were more interested in a pricing intelligence feature it had developed. That product, now called Compete, allows restaurant chains to track their competitors’ pricing and promotional activities at a local level. It’s designed to help franchisees of large chains make informed pricing decisions for their market.

“We’ve found that being able to provide this information to franchisees easily and in an understandable format puts the franchisor in a really good light,” Kamlani said.

Competition is now at the forefront of Juicer and accounts for 80% of its sales.

Kamlani did not rule out that dynamic pricing could be revived at some point. However, he said that a new approach would be necessary for this to happen.

“There’s this allergic reaction to the term dynamic pricing and I think there’s a form of it that’s going to be very consumer-friendly,” he said.

In the meantime, Kamlani is looking for other ways Juicer can help restaurants manage their sales. For the next four months, he’ll be traveling around the country in a pink RV with a unicorn on the side, talking to restaurants about pricing.

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