If you walk into a restaurant and a sandwich costs you $25 you're probably not going to want to go back there. But what if you used your smartphone and signed up with the restaurant to save a few bucks? You may be willing to buy it.
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00:00 If you walk into a restaurant and a sandwich costs you $25,
00:05 you're probably not going to want to go back there.
00:08 But what if you used your smartphone to sign up at the restaurant and save a few bucks?
00:12 You may be willing to buy it.
00:14 It can actually help to mitigate some of these price increases
00:18 because some of those apps have a loyalty system embedded in them.
00:23 And particularly, once again, among the younger age cohorts,
00:27 the ability to be instantly rewarded for loyalty is a basic expectation.
00:34 The National Restaurant Association explains because of inflation,
00:38 restaurant owners are still paying more for labor, rent, utility costs, and so on.
00:43 But they're turning to technology to help offset their higher menu prices,
00:47 which have gone up almost 8% from last year.
00:50 Fast food chain McDonald's has an app where you get points when you buy food or drinks,
00:54 and then you can redeem them the next time you go.
00:56 Restaurants are also rolling out meal subscription programs.
00:59 At Panera, for example, for $11.99 a month, you can get unlimited hot and cold drinks.
01:04 They're trying to move me down my demand curve in the future to get more sales, right?
01:08 Economics professor Greg Price with the University of New Orleans says
01:12 these customer loyalty programs will help bring customers back.
01:16 But he says for a lot of people, the listed price of an item on a menu psychologically stays with them.
01:22 If a price is too high, a rewards program may not do much.