Right now they have to set a price that’s reasonable both when the place is empty, and when it is jam packed. The price they’re using is going to be right in the middle.
If they can change prices dynamically, they’ll want to slightly reduce the crowd when things are busiest, and earn more per customer, and they’ll want to draw people in when it’s empty. When it’s empty they have to pay for workers to sit around doing nothing. They make more money (or lose less money) if those workers are kept busy. To do that, they’ll want to increase traffic by lowering prices.
That’s how surge pricing works.
Right now they have to set a price that’s reasonable both when the place is empty, and when it is jam packed. The price they’re using is going to be right in the middle.
If they can change prices dynamically, they’ll want to slightly reduce the crowd when things are busiest, and earn more per customer, and they’ll want to draw people in when it’s empty. When it’s empty they have to pay for workers to sit around doing nothing. They make more money (or lose less money) if those workers are kept busy. To do that, they’ll want to increase traffic by lowering prices.