The price of a pint is always under debate, with the cost disparity between on-trade and off-trade particularly in the spotlight as the gulf continues to grow – but the concept of “dynamic pricing” has recently fuelled the fires, with initiatives from two big operators drawing howls of protest.
Now, let’s be honest, dynamic pricing is not exactly a new thing, although the label we’re now using is probably not familiar. Pubs have been using dynamic pricing for years, just think of the concept of ‘happy hour’.
The difference now is, rather than discounting drinks to pull in the punters, the operators are increasing the price claiming the increases are justified to cover increased costs – door security or extra staff during events.
Individual operations
Greene King is under fire for increasing prices in one of its pubs during key football matches – again, nothing particularly new as other operators have done that for years, particularly during tournaments like the World Cup.
O’Neill’s increasing the cost of a pint to nearly £10 after 10pm to cover door security is an interesting move – are they gambling on people not wanting to move on therefore sucking up the cost, or do they fancy an early finish and want to clear the pub out? Time will tell!
Ultimately, pubs are businesses and need to make money – how they do that is down to each individual operation.
If you’re hosting an event or putting on live music and not charging on the door, it’s not unreasonable to add a little to the cost of a pint to cover the cost of the event – it’s a policy that works well for Albert’s Schloss.
Be clear
It’s quid-pro-quo situation – if the customer can see a benefit to the increased cost – for example, free entertainment, then it’s less likely to cause upset than telling them the £10 pint is helping to pay for the burly bouncer that’s about to throw his or her mates out.
Pubs should be able to set the prices they feel will work for their business and keep that business afloat.
But we need to be mindful of the increased cost pressure across the board and any move that can lead to calls of profiteering will only serve to damage the wider industry.
So be dynamic with your pricing – but please be clear about why and show the benefits to the punter.