When Dennis Crowley CEO of Foursquare created the concept of the check-in, first with Dodgeball and more successfully with Foursquare, did he realize this concept would transcend industries beyond locations?
Today you can check-in with pretty much anything from movies, thoughts, books and TV shows on Get Glue to locations on Foursquare, Gowalla, SCVNGR, Whrrl, Where, Google Latitude, and Facebook Places. Instagram let’s you check-in with photos of anything, and Foodspotting let’s you check-in with photos of your favorite food. So the question is what can’t you check-in with these days?
With all this hype around check-ins, one industry that is seeing a significant influx of check-ins around its products is the beer industry — specifically craft beer. Craft beer or micro beer is made by smaller artisan/craft breweries throughout the US. Over the past five years, the craft beer industry has become a seven billion dollar a year business. This rapid growth is fueled as consumers are expanding their palettes and tastes by trying all types of flavorful craft beer from local craft breweries. This mass migration from macro beer (like Budweiser, Miller, and Coors) to craft beer is evidenced by the development of beer mobile apps and the beer check-in.
What is the beer check-in?
The beer check-in is a way for people using mobile apps to share with friends what beer they a drinking and where they are drinking it. Several companies are leading the charge in this space and doing it in true start up fashion.
RedPint, Untappd and Beerby all seemed to come into existence around the same time. These three companies offer a similar social experience built around the beer check-in, with Untappd boasting the biggest user base, RedPint laying claim to the invention of the beer check-in in 2009, and Beerby being first to market.
Why does the beer check-in matter?
A common term thrown around the tech world these days is something known as a disruptive service. The idea of a disruptive service is to create something that fundamentally changes the way an established industry functions. Twitter was built to disrupt the media industry, and has it ever. Square was built to disrupt the payments processing industry, and it’s beginning to create an impact. Technology can certainly create revolutions and change user behavior. In this fashion, the beer check-in may be able to disrupt the beer industry.
Why disrupt the beer industry?
If you know anything about the business of beer, you have heard about the three tiered system of shipping and distribution. That is, the process in which beer is sold to wholesale distributors to be shipped to different customers. Most brewers don’t own fleets of trucks and warehouse space to store beer, and most can’t self distribute by law. Beer actually has three distinct points of sale:
1. from the wholesaler to distributor
2. from the distributor to the location (bar, store, retailer)
3. from the location to the customer (that’s you and me)
Across these three transactions, a lot of important customer data is lost to the brewer. This data is critical to a brewer to understand how their beer is being received by the end customer and whether or not their product is successful in meeting market and customer demands. Real-time check-in data can tell a brewer a lot of key information that can allow them to make better “beer” decisions. From aggregating taste ratings of a beer by demographic, to total consumption in a geographic area, to volume predictors to let a brewer know when a location may run out of a specific beer, the sky is the limit. Ideally this real-time data could be used to let a brewer pivot faster and make lean just-in-time manufacturing adjustments in their brewing process to meet real-time market demand and allow them to better forecast their sales and market expansions.
This data could arm brewery brand reps with the consumer sentiment they need in order to make sales in new regions as well as help locations determine what beer to serve as a bar manager could analyze what is being consumed around his/her venue.
The 3 most important things in business today: data, data, data
Recently, several craft breweries like Great Divide have made headlines as they’ve pulled out of smaller markets in order to keep up with demand in larger ones. Since many craft breweries run at full production capacity, real-time location-based data may help them to make better decisions about where they spend their precious beer resources.
The idea of sharing what beer you are drinking with friends is a fun way to engage a passionate community of like-minded beer enthusiasts while awarding them with cool virtual medals or badges for their participation. Untappd, RedPint, and Beerby use gaming mechanics to offer up virtual rewards to keep their users interested and coming back for more. Yet to be truly disruptive, one of these services will need to come up with a way to change the beer industry for the better. It’s the data that is being generated by the community that can be used to help breweries reach more customers providing them real time data allowing them to be more lean and agile in their production of beer.
The laws are notoriously in favor of the big beer companies and distribution of beer via the mail is almost impossible (ahem, illegal). How can these services find a way to monetize their business in order to sustain growth and continue to build a viable service model? That is a question on the minds of the founders of these companies today.
As many of the location-based services and group-buying services compete for the mind share of individuals and the dollars of customers, one thing holds true: You have to either sell something or help someone sell something to pay your bills. Whether you do that through an SaaS model, advertising model, or a consulting model, it doesn’t matter at the end of the day. Being disruptive is great. Being a game-changing service is even better, and being innovative is a must. You have to be able to turn your service into something someone is willing to pay you for.
The beer check-in is here to stay, and the mobile technology to do so is riding on the wave of the craft beer movement as it spreads across America and across the globe. The question remains, will one of these companies be able to monetize what they are doing and become a sustainable business that can support and significantly change the craft beer industry for the better? Well, let’s discuss that over a beer soon.
