The bold “pay-what-you-want” restaurant experiment

A new dining trend allows customers to decide their own menu prices. An economist explains why it's a bad idea

Topics: Food Business, Food,

The bold "pay-what-you-want" restaurant experiment

In the last few weeks, a radical pricing strategy has been making waves in the restaurant world: establishments that allow diners to decide themselves what they’d like to pay for their meal. In May, the fast-growing Panera Bread Co. restaurant chain launched a pay-what-you-want outlet, attracting media attention everywhere from the New York Times to the Wall Street Journal. (Customers could also choose to work volunteer hours in the restaurant in exchange for payment.) This week, Vancouver’s more high-end  Rogue Kitchen and Wet Bar began offering “suggested prices” for its menu of mini-corn dogs, steak and sushi bombs — joining the dozen or so other restaurants across North America that follow a similar model.

Of course, the pay-what-you-can model has been attempted with some success in other businesses, most notably three years ago, when Radiohead put its “In Rainbows” album online and allowed fans to choose its worth. The idea may make some sense in the current food culture, in which movements like organic eating and freeganism have gained remarkable traction, but it also puts a tremendous amount of faith in a restaurant’s customers at the tail end of a recession. Seattle’s Tera Bite coffee shop introduced the policy to great fanfare in 2007, but called it quits after two years.

To find out if the pay-what-you-can model could work for a restaurant, Salon spoke with Tyler Cowen, a professor of economics at George Mason University (and food writer), from Berlin, Germany.

 Do you think this pay-what-you-can model could actually work for restaurants?

You can have a small number of restaurants that use it, but if every restaurant were like that, it would never work. It gets people talking. It’s like Radiohead — for the first group that does it, it’s a good idea, but is it a good model for the industry? Not really. Imagine McDonald’s at Times Square working on this principle. If you kept on going or eating they would discourage you from coming.

Do you think it could work on a small scale — two or three restaurants in a city?

I’m not even sure it can in the long run. I’m not sure if these places will still be going in three years’ time. Part of the problem is if you’re a customer and what you pay is voluntary, you’re under pressure to pay a lot of money. You do it once to prove to yourself and others how charitable you are, but how many people go back 17 times? I would find it a burden — my reputation is on the line. What if I only pay $ 27 instead of $ 34? What does my date think? What does my wife think? You end up wanting to feel liberated and just paying a listed cash price. I think there’s no way to solve that problem.

But Radiohead’s experiment was fairly succesful. What’s the difference between it and a restaurant?

With Radiohead, there’s a focal price of about $10, which is pretty cheap. If you download an album and send in $10, you feel you’ve done your bit, and it’s not a question of repeat business. You download the album once. Radiohead makes most of its income by touring, so even if they lose money on the album, but get more popular, they can just go on tour. A restaurant has no other way to get that money back. They count on the people to pay for their food.

Is there anything that these restaurants can do to encourage people to pay more?

You have to feel like you’re being watched. You have to feel that other people are paying. You have to feel like you’re part of a cool experiment. Even with Radiohead. it’s wrong to call them neighborly, but their fans pretend they’re a tight-knit pool of cool people. That’s an illusion, but you’re still relying on a peer effect. It’s a way to feel you’re better — that you’re so committed to the band you paid for something out of your own pocket.

Are some sectors of the economy better suited to this kind of pay-what-you-can model?

It depends on what you mean by giving things away for free. There’s plenty of stuff that gets given away for free, like NPR. But once NPR’s content is produced, it doesn’t cost them extra to have additional listeners. With restaurants, if somebody eats another plate of veal, it costs them money. It’ll keep this strategy limited. There may be some niche on a small level for these kinds of restaurants, but it’s hard to imagine people saying that they’ve been to six of these restaurant and they’re about to go to their seventh.

Why are these restaurants popping up now?

I’m actually not surprised you see them in down economic times. You let some people pay less that can’t pay more — it’s part of the charm. But these days there’s a restaurant for every possible cuisine, and so many marketing tricks. Restaurateurs are exploring every last possible idea. If you were opening a restaurant in 1957, you could do almost anything beyond steak and potatoes and be considered new, but if it’s 2010 and you’re across the street from the Malaysian place with roller skates, it makes some sense.

Thomas Rogers

Thomas Rogers is Salon's former Arts Editor. He has written for the Globe & Mail, the Village Voice and other publications. He can be reached at @thomasmaxrogers.

Featured Slide Shows

  • Share on Twitter
  • Share on Facebook
  • 1 of 14
  • Close
  • Fullscreen
  • Thumbnails

    13 of "Girls'" most cringeworthy sex scenes

    Hannah and Adam, "Pilot"

    One of our first exposures to uncomfortable “Girls” sex comes early, in the pilot episode, when Hannah and Adam “get feisty” (a phrase Hannah hates) on the couch. The pair is about to go at it doggy-style when Adam nearly inserts his penis in “the wrong hole,” and after Hannah corrects him, she awkwardly explains her lack of desire to have anal sex in too many words. “Hey, let’s play the quiet game,” Adam says, thrusting. And so the romance begins.

    13 of "Girls'" most cringeworthy sex scenes

    Marnie and Elijah, "It's About Time"

    In an act of “betrayal” that messes up each of their relationships with Hannah, Marnie and Elijah open Season 2 with some more couch sex, which is almost unbearable to watch. Elijah, who is trying to explore the “hetero side” of his bisexuality, can’t maintain his erection, and the entire affair ends in very uncomfortable silence.

    13 of "Girls'" most cringeworthy sex scenes

    Marnie and Charlie, "Vagina Panic"

    Poor Charlie. While he and Marnie have their fair share of uncomfortable sex over the course of their relationship, one of the saddest moments (aside from Marnie breaking up with him during intercourse) is when Marnie encourages him to penetrate her from behind so she doesn’t have to look at him. “This feels so good,” Charlie says. “We have to go slow.” Poor sucker.

    13 of "Girls'" most cringeworthy sex scenes

    Shoshanna and camp friend Matt, "Hannah's Diary"

    We’d be remiss not to mention Shoshanna’s effort to lose her virginity to an old camp friend, who tells her how “weird” it is that he “loves to eat pussy” moments before she admits she’s never “done it” before. At least it paves the way for the uncomfortable sex we later get to watch her have with Ray?

    13 of "Girls'" most cringeworthy sex scenes

    Hannah and Adam, "Hard Being Easy"

    On the heels of trying (unsuccessfully) to determine the status of her early relationship with Adam, Hannah walks by her future boyfriend’s bedroom to find him masturbating alone, in one of the strangest scenes of the first season. As Adam jerks off and refuses to let Hannah participate beyond telling him how much she likes watching, we see some serious (and odd) character development ... which ends with Hannah taking a hundred-dollar bill from Adam’s wallet, for cab fare and pizza (as well as her services).

    13 of "Girls'" most cringeworthy sex scenes

    Marnie and Booth Jonathan, "Bad Friend"

    Oh, Booth Jonathan -- the little man who “knows how to do things.” After he turns Marnie on enough to make her masturbate in the bathroom at the gallery where she works, Booth finally seals the deal in a mortifying and nearly painful to watch sex scene that tells us pretty much everything we need to know about how much Marnie is willing to fake it.

    13 of "Girls'" most cringeworthy sex scenes

    Tad and Loreen, "The Return"

    The only sex scene in the series not to feature one of the main characters, Hannah’s parents’ showertime anniversary celebration is easily one of the most cringe-worthy moments of the show’s first season. Even Hannah’s mother, Loreen, observes how embarrassing the situation is, which ends with her husband, Tad, slipping out of the shower and falling naked and unconscious on the bathroom floor.

    13 of "Girls'" most cringeworthy sex scenes

    Hannah and the pharmacist, "The Return"

    Tad and Loreen aren’t the only ones to get some during Hannah’s first season trip home to Michigan. The show’s protagonist finds herself in bed with a former high school classmate, who doesn’t exactly enjoy it when Hannah puts one of her fingers near his anus. “I’m tight like a baby, right?” Hannah asks at one point. Time to press pause.

    13 of "Girls'" most cringeworthy sex scenes

    Hannah and Adam, "Role-Play"

    While it’s not quite a full-on, all-out sex scene, Hannah and Adam’s attempt at role play in Season 3 is certainly an intimate encounter to behold (or not). Hannah dons a blond wig and gets a little too into her role, giving a melodramatic performance that ends with a passerby punching Adam in the face. So there’s that.

    13 of "Girls'" most cringeworthy sex scenes

    Shoshanna and Ray, "Together"

    As Shoshanna and Ray near the end of their relationship, we can see their sexual chemistry getting worse and worse. It’s no more evident than when Ray is penetrating a clothed and visibly horrified Shoshanna from behind, who ends the encounter by asking if her partner will just “get out of me.”

    13 of "Girls'" most cringeworthy sex scenes

    Hannah and Frank, "Video Games"

    Hannah, Jessa’s 19-year-old stepbrother, a graveyard and too much chatting. Need we say more about how uncomfortable this sex is to watch?

    13 of "Girls'" most cringeworthy sex scenes

    Marnie and Desi, "Iowa"

    Who gets her butt motorboated? Is this a real thing? Aside from the questionable logistics and reality of Marnie and Desi’s analingus scene, there’s also the awkward moment when Marnie confuses her partner’s declaration of love for licking her butthole with love for her. Oh, Marnie.

    13 of "Girls'" most cringeworthy sex scenes

    Hannah and Adam, "Vagina Panic"

    There is too much in this scene to dissect: fantasies of an 11-year-old girl with a Cabbage Patch lunchbox, excessive references to that little girl as a “slut” and Adam ripping off a condom to ejaculate on Hannah’s chest. No wonder it ends with Hannah saying she almost came.

  • Recent Slide Shows



Comment Preview

Your name will appear as username ( settings | log out )

You may use these HTML tags and attributes: <a href=""> <b> <em> <strong> <i> <blockquote>