In April 2010, New Yorks Robin Raisfeld and Rob Patronite gave a glowing five-star review to Torrisi Italian Specialties, calling it a tremendous bargain, and a serious delight. Two weeks later, Torrisi hiked the price of its tasting menu by 10 percent, to $50. It seems like it must happen all the time: A restaurant gets a rave review, and next thing you know it jacks up its prices.
It stands to reason that a great review increases demand and the amount that diners are willing to pay. But in fact it doesn't really work that way.
Of course, some restaurants hike their prices after a rave. But others hike their prices after a bad review, or after no review at all. It turns out there's very little correlation at all between good reviews and price hikes.
None of this is easily apparent: Restaurants, especially at the high end of the market, can be unforgivably opaque when it comes to prices. David Bouley's website, for instance, offers no pricing information for his restaurants. The web helps, of course. Sites like New York's own MenuPages constantly update pricing info, and recently Ryan Sutton, Bloomberg's restaurant critic, launched thepricehike.com to keep an eye on such things. His first scoop: Chef's Table at Brooklyn Fare raised the price of its menu from $165 to $185 just two days after Sam Sifton's rave review in the New York Times.
Sutton also maintains a list of the priciest three- to five-course set menus in New York. Up until recently, the top two restaurants were Eleven Madison Park, at $125, and Del Posto, at $115, and it was natural to draw a causal relationship between those ultrahigh prices and the four-star reviews that both restaurants recently received from the Times.
But it's not as simple as that. Eleven Madison's five-course tasting menu was $125 even before Frank Bruni's review, and although Del Posto did raise its prices after Sifton's rave, its prices are still lower than they were in 2008, when the restaurant had three stars from Bruni.
And look which restaurant just vaulted to the top of Sutton's list: Gordon Ramsay at the London, with a $135 tasting menu priced solely owing to the power of Ramsay's global brand. (Never mind the fact that Ramsay no longer actually owns or operates the universally panned restaurant.) That said, $135 for three courses looks like a veritable bargain compared to the $135 bowl of soup at Milos, where reviews aren't bad so much as nearly nonexistent.
So even at the very top of the market, it's possible for restaurants to charge extremely high prices without any ratification from restaurant reviewers at all. And at the other end of the spectrum, very well-reviewed restaurants can be downright cheap, especially if they're Chinese. Whatever it is that spurs restaurateurs to raise their prices, it isn't reviews.
This can be seen visually, too. With the help of New York intern Ray Rahman, I recently collated every review from Sam Sifton and Adam Platt over the past year. Sifton's reviews ranged from zero stars to four; Platt's from zero to three. The charts show that restaurants are constantly recalibrating their prices, and that reviews from influential critics have almost nothing to do with it.
It makes sense: Food prices and diner behavior are complexly dynamic, and while a review may loom large in the publics perception of a restaurant, its only one of a multitude of factors at play. The most stable and profitable places may have the luxury of keeping prices unchanged for long periods of time, but everybody else is constantly tweaking: Appetizer prices go down while entrees go up; cheaper entrees go down while steaks go up; tasting menus go up but add extra courses; the tasting menu goes up in price while entrees go down; high-end items get added to menus or taken off that kind of thing.
Looking at the restaurants Sifton and Platt reviewed, most of them made inconsistent changes to their menu prices: Some items went down, others went up, but there werent many across-the-board price hikes.
A minority of restaurants did have obvious post-review price hikes, but they were middling reviews, not raves. Lavo got a no-star, "fair" review from Sifton in November. Back then, the pizza and pastas topped out at $38 with the entrees ranging up to $48; now the pastas are as much as $45 and the entrees can set you back $55.
It's worth noting that a good review is profitable for a restaurateur even if prices stay flat if business picks up, the restaurant is likely to make a lot more profit. Why mess with a formula which has been proven to work? On the other hand, if you get a bad review you won't be getting much new business, and you might have to start raising prices on the few customers you already have.
Fundamentally, the restaurant business is a highly capricious one. Well-reviewed restaurants struggle, and dreadful ones can sail on for decades if they have a loyal local clientele. Food reviewers nearly always care much more about food than most diners, who go out for a multitude of reasons.
From a consumer perspective, the lesson here is that price is no particular guide to food quality, as measured by reviewers' stars or anything else, nor do rave reviews mean that a restaurant will soon be hiking its prices. Some great restaurants are very expensive, but many mediocre ones are, too. And sometimes food quality is simply irrelevant. The Four Seasons will always be booked solid, no matter how much money it charges, and pretty much regardless of how the dishes taste or what reviewers might say.
Restaurateurs, especially at new establishments, undoubtedly lose sleep about how many stars they're going to get from Sifton and Platt. But reviews rarely make as much of a difference as we might suspect at least when it comes to the check.
Felix Salmon is the finance blogger at Reuters.