Friday, April 04, 2008

A simpler way of dealing with scarcity.

This is all very interesting and I'm not sure I disagree with any of it, but why doesn't David Chang raise his prices?

With only 35 reservations a night and those released only a week in advance, He would have to price himself out of the rest of the market.

I applaud what he seems to be doing, actually. One can create buzz by making a place ridiculously expensive, or by making it hard to get into because demand exceeds supply for another reason. The latter seems a lot more democratic and more true to the cuisine as well.

A year from now the buzz will have slowed down. But if he's serving good food at a reasonable price that's accessible, the restaurant will outlive its hype.
Shockingly, I agree with diarist on this. As at least some of the comments on the original NYT piece said, at least you know within like 1 or 2 min on Monday morning whether you are in or not. Then you can move on with your life until the next Monday morning.

Maybe he's (DC's) intentionally selecting against the fuddy duddies who don't know how to use the internet?
Creating buzz is fine, but isn't there a danger that in a year the buzz will have gone the way of year-old restaurant buzz? It's hard to bank that. There are reasons to make sure that demand continues to exceed supply, but it sounds like Chang could increase prices a bit and still have impressive demand.
When it comes to Manhattan restaurants with buzz, there is substantial inelasticity of demand.

And to new diarist's point, I imagine Chang hopes to cook for more than i-bankers and lawyers. Raising prices enough to impact 35 rezzies a night would price the place out of reach of the merely overpaid.
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