Subscription Models in the Restaurant Industry: A Behavioral Economics Perspective

Details

Supervisors

Johnen, Johannes

Faculty

Faculté des sciences économiques, sociales, politiques et de communication

Degree label

Master [120] en sciences économiques, orientation générale, à finalité spécialisée

Abstract

This thesis explores the growing use of subscriptions in the restaurant industry, focusing on how these models influence consumer behavior and drive profitability. By examining both behavioral economics and consumer psychology, the research highlights how businesses strategically design these programs to exploit consumer mistakes such as overestimation, inattention, and the sunk cost fallacy. The study delves into tactics like auto-renewal contracts and teaser rates to illustrate how they subtly encourage consumers to spend more than intended. Additionally, it investigates the psychological motivations behind consumer participation in these programs, including the insurance effect, the taxi-meter effect, and the convenience effect. This work offers a nuanced understanding of the delicate balance between consumer convenience and potential exploitation, shedding light on the implications of these increasingly prevalent business strategies for both restaurants and consumers.