Do Bottomless Drinks lead to a Bottomless Pocket?

Bottomless, infinite, endless, free, and… drinks. These are some buzzwords usually tagged along with having a good time! Bottomless drinks have become a major trend over the last few years. The craze started in the late 2010s and has skyrocketed in the 2020s, just like Dua Lipa! (See more on Google Trends) 

Now, the entire concept doesn’t really make sense to the common man, does it? You’re offering unlimited drinks for one price, that is, as many refills as they want. Technically, you’re offering a person the same item more than once while they pay only once. Where in the world does the money come from?

Image from Unsplash

Bottomless drinks run based on highly balanced pricing. Restaurants have to balance the cost of the food offered with the drinks on a very very very thin margin. In case I haven’t exaggerated enough, the margin would be so thin even a piece of pencil lead wouldn’t fall into it. The restaurant would have to maintain pricing in such a manner that they can provide for the cost of offering bottomless drinks but at the same time don’t end up pricing themselves out of the business. 

A lot of analysis goes into making this work. Which day should we offer bottomless drinks? What time? What drink should we offer? Cocktails or mocktails? Everything has to be cost-efficient and optimised enough for the restaurant to gain money and market itself at the same time. The happy consumer experience ensures that they come back and maintain customer loyalty. It also gives the business a competitive advantage over its alternatives. 

Bottomless drinks are considered a ‘loss leader’ pricing strategy- where a business takes up an intended loss by selling something below its market cost to bring in more customers. 

(Read more at Yahoo Finance)

Image from Unsplash

Olive Garden is one well-known restaurant chain that uses this strategy. They offer their customers bottomless soft drinks which encourages them to order more food from the main course and desserts menu (the items which have a higher profit margin), giving them more profitability. They've followed this strategy for other food items as well- breadsticks, salads, and even pasta! (Read more at Olive Garden) 

This has so far proved to be effective in bringing in more customers and also creating a reputable brand image for Olive Garden as a restaurant that offers great value and a solid dining experience. 

Would you be able to have a bottomless drink more than thrice? 👀