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The Spoon

Daily news and analysis about the food tech revolution

Dynamic pricing

Byte Adds Dynamic Pricing to Its Smart Vending Fridges

Byte Technology added dynamic pricing to its smart fridges this week, giving its clients the ability change prices of stocked items on the fly.

Through a combination of RFID and IoT, Byte makes smart vending refrigerators that allow shoppers to swipe their credit card, take what they want from that fridge and get charged automatically. The company licenses its technology platform to retail operations like supermarkets or restaurants, which brand the fridge to sell their packaged food (or anything really).

Because of the RFID tags and connectivity, a Byte fridge knows exactly what’s in its inventory as well as what items sold, when and to whom. With the addition of dynamic pricing, Byte fridge operators can now automatically discount items for just about any reason.

For example, if a fridge is stocked with fresh sandwiches, the operator can create a 25 percent discount on any of them set to expire. Because the fridge already knows everything about its inventory, it automatically knows which sandwiches this discount would apply to, so the operator doesn’t have to set a specific date or create a new rule each time. It could also run promotions on particular drinks, such as half-off carrot juice after 5p.m. on weekdays, or broader discounts like discounts on cobb salads every Monday.

By giving operators the ability to offer dynamic pricing, Byte hopes to reduce the amount of spoilage and food waste created through its platform. This type of dynamic pricing already exists in grocery stores through solutions like Wasteless, which algorithmically discounts food price based on factors like expiration date. And the Karma app teamed up with Electrolux to create special fridges in grocery stores that sell almost expired food for at least half off.

As I wrote about in my recent The Great Vending Reinvention: The Spoon’s Smart Vending Machine Market Report, the COVID-19 pandemic is forcing retailers to examine new, contactless ways of selling. Vending services like Byte’s offer the ability to sell products without human-to-human interaction. And though the pandemic has shut down offices, which were a main line of business for Byte’s machines, Byte Founde, Lee Mokri told me by phone this week that it is seeing increased interest from places like residential buildings.

Come to think of it though, having a smart vending machine in the lobby of an apartment building that can automatically discount a pint of ice after midnight might not be the greatest thing in the world.

Feedback App Lets Restaurants Pick Their Off-Peak Pricing

If you’ve ever been to a restaurant between two and five o’clock, chances are pretty good that you walked into a near-empty establishment, with servers, hosts and kitchen staff waiting around until the dinner rush.

Feedback wants to make those off-peak hours more productive by giving restaurants the ability to offer dynamic pricing and discounts to entice more customers and reduce food waste. Based in Toronto, Feedback is a mobile app that gives consumers time-specific deals on meals at participating restaurants. All meals are for pick-up at the restaurant; they don’t offer delivery.

Once a restaurant is on-boarded into the Feedback platform, managers can go in and adjust pricing to set up special deals during slow times of the day. Restaurants can even limit the quantity of the deal (e.g. first 20 burritos are half off) to best fit their economics.

The app launched in October and has signed on 220 restaurants in Toronto, none of which have churned, according to Feedback Co-Founder and CMO, Josh Walters. Customers seem to be liking it as well. Feedback has roughly 20,000 users and Walters says that within a month fifty percent of its users make a second purchase with the app.

It’s not hard to see why; Feedback creates a win-win-win scenario. Consumers get a discount on their meals, businesses stay busier throughout the day, and there is less food going to waste. There is a bigger societal win too, because Feedback has a rewards system where after four purchases, it donates money to charity to help feed people in need. There’s a community page in the app where users can track the number of meals donated, dollars saved and food that has been diverted from the trash bin.

Right now, Feedback is still signing on Toronto restaurants one at a time. It negotiates a commission structure with each establishment, dependent on a number of factors. Eventually, the company’s bigger play, is in its data. Feedback will package and sell the consumer analytics it collects back to its restaurant partners so they can see when people are ordering, what they are ordering, and how effective different discounts are.

Feedback has nine full-time employees and has raised a small, undisclosed seed round of funding. Last year, the company won a pitch competition put on by the coworking company WeWork that included $50,000 (Canadian) as well as a year’s worth of WeWork office space.

Walters says that Feedback is currently working on a notifications system for the app to alert users when specific discounts are offered. It may also want to work on its name. Feedback as a name doesn’t say anything about eating, and instead conjures up images of filling out a survey.

Feedback isn’t the only startup using dynamic pricing for social good. Across the border in New York, Gebni uses AI to help restaurants identify different pricing opportunities in an effort to make restaurant quality food more affordable to more people.

I’m actually surprised we don’t see more dynamic pricing startups like Feedback and Gebni trying this out in densely populated areas. It seems like a pretty straightforward way for restaurants to add more revenue and reduce food waste.