Getting something brewing
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This paper was presented at the MSKE Conference in 2011 and sets out the possibilities for collaborative technologies, Social Media and social and relationship capital to be used by craft breweries ...

This paper was presented at the MSKE Conference in 2011 and sets out the possibilities for collaborative technologies, Social Media and social and relationship capital to be used by craft breweries and brewers to create value

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Getting something brewing Document Transcript

  • 1. Getting Something Brewing Getting Something Brewing A paper prepared for MSKE 2011 Copyright: This material is made available under the following Creative Commons terms cc by-nc-sa 2011 1
  • 2. Getting Something Brewing Abstract The purpose of this paper is to present a case study showing the Social Media (SM) strategy which has been developed and implemented by the Glasgow-based consultancy twintangibles for one of their clients. The contribution will be mostly empirical, giving practical examples of different aspects of the application and embedment of SM in a business strategy, and how they can help boosting innovation through crowd-sourcing and customer feedback. The paper will cover both the issues and more importantly the opportunities that the initiative generated. The authors believe it is indicative of the potential for the wider use of SM in the sector, as well as in other sectors following the same strategy. The authors identified a prime candidate brewery following a close analysis of the social media marketing strategies in place/not in place in each brewery. We undertook a three- month project aimed at establishing and building a SM presence for the client; monitoring and identifying key trends in the sector and commercial opportunities; showing a return from the effort (or ROI) involved in the SM project; developing a strategic approach for the brewery to make use of SM as part of its key business/strategic plan. The case study presented here sets out the key findings from that project. This paper was presented and the MSKE Conference 2011 The authors are Tim Wright and Daniela Castrataro of twintangibles 2
  • 3. Getting Something Brewing 1. Introduction This paper is a case study of the introduction of the use of Social Media (SM) tools to a client in the craft-brewing sector in Scotland. It covers both the issues and more importantly the opportunities that the initiative generated. We believe it is indicative of the potential for the wider use of SM in the sector and reflects the type of challenges that a similar organisation would face. The same potential can be exploited in other sectors following a similar strategy. As a sector, craft brewing typically attracts consumers who are passionate and selective about their product, and prepared to pay a premium for it. They are also keen to share views and, whilst they display strong brand loyalties, they are often keen to enter into product comparison exercises. It is apparent that these consumers do have a SM presence and are active in the main SM channels – blogging, Facebook, twitter etc. Indeed many of the overarching and coordinating groups for the sector, for example CAMRA, are also active on SM (twintangibles, 2011a). The product itself is, by definition, produced by smaller organisations, run by enthusiasts and evangelists, and typically distributed through a mix of a limited number of regular outlets and a range of occasional retail outlets. The craft brewing sector in Scotland displays all of the above mentioned characteristics. Our view is that SM can offer these organisations a powerful and cost effective mechanism to: ● raise brand awareness, ● bind in consumers to become brand evangelists, ● generate new opportunities by identifying new distribution and retail opportunities as but two examples, ● provide deep customer driven insight for product development and innovation, ● crowdfund expansion. However, a brief research project conducted by the authors identified that of the 57 craft breweries present in Scotland less than 10 had any meaningful SM presence. This is in spite of the fact that the one notable exception to this had already demonstrated significant business success from their investment in SM tools. (twintangibles, 2011b) We believe that there are two key factors explaining the smaller craft breweries lack of take up of what we identified as being a key opportunity for them: 3
  • 4. Getting Something Brewing ● Lack of understanding – both at a technical and practical level, and additionally at the level of not recognising the opportunity. ● Lack of resources - the breweries are typically SMEs and, as such, they are resource- and time-constrained, thus finding it hard to justify the time spent in making use of SM (Journalism.co.uk, 2010) As twintangibles, a Glasgow-based social media consultancy, the authors identified a prime candidate brewery following a close analysis of the social media/marketing strategies in place/not in place in each brewery. Following a successful interaction with the targeted brewery’s owner, we undertook a three-month project aimed at: ● Establish and build a SM presence for the client ● Monitor and identify key trends in the sector ● Identify commercial opportunities for the client ● Show a return from the effort - or ROI as many would say - involved in the SM project ● Develop a strategic approach for the brewery to make use of SM as part of its key business/strategic plan. The case study presented here sets out our experience of that project. 1. Background SM is a phrase that has seen a significantly raised profile in recent times. In essence it refers to a set of technologies that operationalise and support a mindset of action including high levels of engagement, ubiquity of access, democratisation of involvement, the idea of mutuality, high levels of interactivity, multiple degrees of many to many peer linking, and powerful community development and aggregation regardless of physical location (Kaplan and Haenlein, 2010). This phenomenon that is typically associated with a younger demographic but is already much more widely embraced, draws on applications that play and add value to specific aspects of that mindset. These tools have already gone through several aiterations of life cycle of adoption and abandonment, and the ubiquity of connectivity through an increasing range of mobile devices. The impact this has on social and economic arenas is both wide and profound and the development of novel approaches to addressing perennial issues is a feature of the mindset of the acolytes. 4
  • 5. Getting Something Brewing In a business context the dynamic of social media has tremendous possibilities. This includes generating new market possibilities by aggregating consumers in such a way that what were previously un-commercial markets become viable; innovation through crowdsourced open innovation models that significantly expand the potential for step- change developments by drawing on the “long tail” of distributed cognition; new funding mechanism through crowdfunding models that radically extend and change the investor base and adopt very different expectations of return (Tapscot and Williams, 2007). New operational models are becoming apparent, challenging the traditional notions of what constitutes organisational boundaries, and this is without considering the exciting possibilities for generating value through knowledge-based activity that was previously impossible. The opportunity for new disruptive businesses is clear, however we believe that existing businesses that take a strategic approach to the use of SM can also innovate and find tremendous opportunity for developing competitive advantage and value within a traditional business model. Typically a great deal of the “buzz” around SM in a business context is overly focussed on its application as part of a Sales and Marketing tool. There are cases where this is a valuable approach, however we would caution that marketing through SM channels requires both strategy and a significantly amended model to the traditional marketing approach, and it is by no means a universally successful model. We believe that marketing is simply a fraction of the opportunity that SM presents and that an approach to SM must come from the perspective of understanding the opportunities that the new mindset that underpins SM offers to a business, how this can be leveraged as another organisational intangible asset, and how the community that develops will become one of the organisation's most versatile intangible assets from which value can be unlocked in many different ways (Wright, Watson and Castrataro, 2010). In sum then it is necessary to take a holistic approach to the introduction of social media in order to ensure that it is appropriately aligned with strategic objectives of the organisation and not a “vanity” project. This approach necessitates a longer term perspective of any SM initiative and this is a paradox in an environment shot through with imperative and immediacy. This apparent contradiction can cause confusion, misalign expectations, and run counter to some commonly held beliefs. The title of this paper “Getting Something Brewing” intentionally uses the phrase to articulate the nurturing and organic growth aspect of a SM initiative. It also makes the oblique reference to the sector the case study centres on that is to say brewing. 5
  • 6. Getting Something Brewing The brewing sector is diverse and global, ranging from large multinational operations with highly diversified portfolios to very small concerns in the craft brewing sector. The later sector in particular has certain characteristics that would seem to lend themselves to alignment with a SM sensibility, and thereby yield potential opportunity. That is to say the Craft brewing sector is enthusiast led. The brewers and the consumers are often passionate about the product and the specific individual characteristics of their beers and embrace the opportunity to talk about both the process of production and the joys of consumption. Most breweries, from the largest to the smallest have visitor centres and organise brewery tours, which must be almost unique in a manufacturing or production setting. The product itself is inherently social and is associated with communal activity and discourse. This manifests itself in clubs, societies, festivals, competitions and, in the social media environment, through blogging, podcasting and vodcasting, where the varying merits of particular products are discussed at some length. Craft breweries are highly innovative in developing products and keen to establish differentiation, indeed it is the diversity of the environment that attracts the enthusiast. Additionally – particularly in a the craft beer environment - the internet has opened off trade retail opportunities for breweries that would have historically been more limited through the use of e-commerce and the associated fulfillment services. The on-trade for craft beer in the UK is a vibrant and active network of both tied and free outlets that take limited quantities of guest beers. This is distinct from some of the largest brewers that had historically significant control over their distribution channels through networks of tied houses. A further aspect of the craft-brewing sector is the often significant capital costs to both establish and - perhaps more importantly - expand production and distribution facilities. Craft brewing has, even at first sight, a number of areas that could strategically draw upon both the tools and the mindset associated with SM to find competitive advantage and opportunity. Some of the business areas where it could be applied are set out below. Sales: Social Media can function as a mechanism to generate conversation, engagement and “buzz” around the brand in order to drive sales through on line and traditional retailing. They can also highlight availability of products on both a regular and occasional basis. Festivals and localised events can be exploited too, as a conversation topic on social networks. 6
  • 7. Getting Something Brewing Brand advocacy: SM can raise the profile of the brand through brand advocacy thereby discovering or engineering opportunities for products to enter into new outlets, for example through the occasional and guest beer circuits. Identification of new markets: SM can significantly help through analysing social community distribution, demographics and trends. Customer needs can be analysed by simply “asking” what they are looking for. Product/Process development and innovation: thanks to direct interaction with the customer facilitated by SM, product quality can be improved through deeper pre- hypothesis understanding of consumer perception and wants, and early warning system for quality issues. In the same way, product innovation can be implemented both iteratively and disruptively through crowdsourced insight, ideation and testing by an extended community. Process development can be implemented too sourcing ideas, for example to enhance packaging, manufacture and logistics. Funding opportunities: thanks to SM-enhanced crowdfunding, a “social tribe” can be developed for purposes of novel funding for projects and expansion and general business development. These individual ideas, whilst not an exhaustive list, emphasise the breadth of application and the importance of a strategically aligned and holistic approach to developing a SM project. Similarly we could set out a time-based continuum that would indicate the relative times required to begin to yield value from each aspect, some being relatively quick to have an effect and some taking a considerable time and resource to develop. Finally we would use different channels and approaches to develop each of these aims so again illustrating the importance of having a plan to effectively bring this to reality. As a Glasgow-based consultancy we were particularly interested in the Scottish Craft brewery sector and carried out a survey of the social media presence of the sector. The survey consisted of an audit of craft breweries in operation, their online presence, their SM presence, and assessment of its maturity, awareness and effectiveness. According to the survey at the time there were – by our estimation – some 57 operational craft breweries. Craft breweries or microbreweries, as they are also known, are defined by their manufacturing capacity. The precise definition varies internationally. 7
  • 8. Getting Something Brewing Of the 57 breweries identified less than 10 had any meaningful SM presence – which may have included twitter feeds, Facebook presence etc. Of these only a handful were active in any meaningful sense of the word (twintangibles, 2011b). This stood at odds with an active and engaged community of SM participants who described themselves as craft beer advocates, consumers and/or active in the craft beer scene as it where. Our view based on our research, which included conversations with consumers, brewers and those associated with promoting craft beer, was that the reasons were not distinct in the brewery sector common to any other grouping of SMEs, and that is two main factors: lack of understanding and lack of resources (twintangibles, 2010). There was, however, one stand out exception to this trend that demonstrated some of the possibilities that an engaged SM approach could offer: the Fraserburgh-based brewery called Brewdog. Describing themselves as “punk brewers” Brewdog is a young brewery both in terms of the age of the company, but most importantly in its attitude and the age of its founders who were both under 25 when the brewery was founded in 2007. Not surprisingly, the use of SM was not separate activity to these founders, it was an integral part of their lifestyles and this naturally extended into the foundation and development of their enterprise, which has been discussed, charted and transmitted through SM channels. Brand-savvy and counter-cultural Brewdog developed a loyal following, nurtured and sustained by the founders mainly through SM channels. This tribe became a significant asset as their above-the-line and below-the-line marketing was amplified by their brand champions. Their advocacy developed footprint and opened up markets rapidly and internationally, and when it came to a significant expansion to meet demand requiring a £2million-pound investment, the brewery was able to draw on its tribe to underpin a crowdfunded IPO. Brewdog continues to use its community effectively and innovatively: for example, only recently they crowdsourced potential sites for branded bars in Aberdeen, Edinburgh, Glasgow and England. With this example in mind, we sought to work with a small brewery to help them to develop and operationalise a SM strategy and understand the challenges associated with developing this multi-faceted intangible asset from a standing start. Under the terms of the confidentiality agreement put in place between us and the client, we are not able to name or identify them, nor can we openly discuss their strategic plans. What we will do is detail some of the activities, challenges and opportunities encountered during the time we have been working with them. 8
  • 9. Getting Something Brewing The project was time-limited to three months and this account will cover only that period. 3. The Case From the outset both twintangibles and the client were conscious of the time-limited nature of our involvement – which was offered on a pro-bono basis. Whilst the work and engagement was welcomed by the client the pro bono nature of it did, in the opinion of twintangibles, somewhat relegate it in terms of attention and priority in the eyes of the client. In consequence efforts to wholly integrate it with the wider plans of the brewery were less successful that we would have hoped. A number of indicators suggested this over the course of the engagement, not least the availability of key staff, a lack of responsiveness to sometime urgent requests for guidance, and small but noteworthy points like a failure to honour the simple but important undertaking to add SM channels links to the main company website, a significant oversight in our estimation. Nevertheless, we resolved to establish and brand a number of channels appropriate to the B2C nature of the business, in keeping with their plans in as much as we were made aware of them, and begin the process of establishing a conversation with a community interested in the products. The aim was to: ● Raise awareness of the availability of the brand. ● Extend brand awareness in the craft beer community. ● Extend awareness of the brand’s portfolio of products. ● Identify opportunities to distribute and sell the product more widely. ● Establish the foundations of a community that would serve as an intangible asset for the client to draw on over time in ways that would become apparent as the opportunities presented themselves. This was ambitious for the brief period of our involvement however it was intended as a mechanism of building competence in-house to work with the community on an ongoing basis. In managing a SM presence for a client it is always important to establish a “voice” for the brand in order that the communications are sufficiently distinct and carry the values associated with the brand. This requires a clear brief and steer from the client at the outset, and an ongoing point of contact with sufficient authority to guide in its iterative 9
  • 10. Getting Something Brewing development. This proved difficult to sustain in our case as the senior management were involved in other projects which meant their availability for briefings was limited. twintangibles put in place a monitoring and reporting structure intended to give a useful set of benchmarks and indicators and a simple review mechanism for the brewery owners to understand the nature of the activity, the impact it was having and the chance to identify opportunities through the scanning of this material. It was also a way of endeavouring to keep open channels of communication. However the level of engagement it prompted was limited also in this case, and no other management information was readily shared with twintangibles making it very difficult to interpret the impact of the SM activity with for example increasing website traffic etc. Without this effective analysis and comparison it is challenging to adjust and refine the SM activities to be at their most successful and clearly we would recommend a closer integration of the monitoring and evaluation process for any client. Without any intention to be accusatory, this commentary simply serves to indicate that there is a significant resource implication involved if one is to effectively introduce and manage a SM strategy with specific intent, and to effectively have an opportunity to demonstrate ROI. Given the nature of the business, our main focus was on the “high-touch” channels of twitter and Facebook. We quickly identified key bloggers and twitter users that fitted the target profile for our initial user group of influencers and active SM participants. Follower numbers grew steadily through a policy of targeted follows, high availability and personalised responses. No automated tools were used based on twintangibles unshakeable view that the quality of followers is much more important than their quantity. Interestingly, the openness of communication and the emphasis on listening that is central to the dynamics of SM communications was not readily grasped by the traditional marketeers at the brewery and because of this it was often difficult to get a brief for a specific response as the “need” to do this was not clearly understood. By the same token the origination of timely original material from the brewery as content for the channels could be challenging. Similarly, it became apparent the inability to recognise that sometimes what might appear mundane was in fact highly “personal” and so useful material for generating sense of closeness to the company and brand. For example schedules of production of specific products were not readily shared as it wasn’t acknowledged by those responsible that the brewing process of a specific beer as well as the process of production had narrative quality of interest and value to followers and consumers of that specific product. To the brewers it was just another day at the office so to speak. 10
  • 11. Getting Something Brewing It quickly became apparent that one of the most commonly requested features of the community was a regular and accurate information flow of where the products were available. Outlets that had a social media presence – typically pubs and bars - were quick to accept and embrace the reciprocity of the SM exchanges and were keen to become involved in the discussion. Indeed the offer of SM visibility for an outlet did on several occasions cause them to request more of the brewery’s product to be stocked or to initiate an order. However, to our surprise, the brewery’s systems were not sufficiently agile to be able to provide good reliable information as to the distribution of its products and it became increasingly difficult to establish where the product actually was available. This was a dilemma as stating its availability for a community to discover that it was not the case simply garnered disappointed posts. This episode emphasises the importance of ensuring that a holistic approach is used in establishing a SM presence. As opportunities arise, there need to be a logistic and infrastructural capital in place to complement the intangible capital to rapidly respond to the communities needs. Furthermore there was reticence on the part of some of the management to make available details on outlets as the view was that it was an invitation to other breweries to try to displace their presence at the bar. We saw no evidence of this behaviour and in our estimation a comprehensive list of outlets of the companies products was the most requested functionality from the community and would be a key requirement in any similar engagement. Our experience with breweries and drinks manufactures since this engagement has born this out as being correct. However the attitude of the company that is the subject of this study reveals a difficulty with understanding the need to have a communication dynamic that begins from a position of openness, trust and engagement and that to do this is to nurture an asset rather than expose a risk. Similar lack of alignment was displayed as requests for the company’s products began to flow in through the SM channels. These took the form of both leads from community members where they suggested outlets close to them that might want to take the beer products – a crowdsourced lead generation if you will - and also from the outlets themselves proactively seeking to procure the products as a result of coming across the SM presence. However, despite being briefed that the brewery did wish to ship more widely there was, when it came to it, no willingness to ship to these outlets (often on the basis of cost) and again the relationship that could have been built was allowed to wane. So to with the lead generation. A small and unempowered sales team did not feel able to follow up effectively with the potential pipeline of prospects, which meant that only few converted to actual sales. Once again this should remind us of the necessity of clarity 11
  • 12. Getting Something Brewing around strategy. The costs of shipping that might constrain ambitions to reach new outlets need to be clearly articulated so as to manage expectations and communications effectively. A haphazard approach will rarely do. Additionally it became apparent that there were technical issues with communication with the brewery through traditional mail and telephone channels, and community members fell back on SM channels to contact the brewery when these other channels failed. This was a combination of technical issues with systems in the brewery, and the absence of a highly communicative and collaborative atmosphere within the company which was somewhat odd given that is was a relatively small organisation. Again there is no intent to offer any judgement on the merits or otherwise of this situation. It simply illustrates one of the great strengths of SM in that it shines an unrelenting and unmediated light from the outside in and can illuminate issues that are simply not apparent from within. Hence SM should be seen as a tremendous opportunity to gain deep insight of business practices as well as of customer perceptions and by embracing that objective analysis an opportunity to radically improve customer service. This was illustrated on one particular occasion when our monitoring picked up on a disgruntled and influential beer blogger who had ordered beer from the online shop only to receive damaged goods. His attempts to contact the brewery had met with failure and his posts were increasingly unfavourable and a very damaging blog was very much on the cards. We were able to mediate on behalf of the brewery, raise the issue with the necessary parties in the brewery who were able then to deal with the blogger direct and find a satisfactory outcome for all. The result was a positive blog that sung not only the praises of the product but the communications and responsiveness of the brewery. Fundamentally the challenge faced was an organisation that struggled to understand the nature of the SM environment and the changed dynamic of the engagement they needed to adopt to thrive there. For example they found it difficult to accept that an email list that exploits the mono-directional communication with one of the product buyers was a different proposition to participating in a many to many conversation between multiple buyers and brand advocates. To a certain extent this reflected a controlling mindset to communications and there was limited tolerance of unmediated conversation around the brand – that is to say groups speaking about it outside of channels controlled by the brewery. For many schooled in a communications environment where channels could largely be controlled and dissent strangled, this democratised environment of SM is frightening, and remains so until the alternative mechanisms of engagement are better understood. It seems in some 12
  • 13. Getting Something Brewing circumstances three months is perhaps not long enough to cross that particular Rubicon. This impression was reinforced by a reluctance on the part of the brewery to speak thematically – for example more generally about beer and beer culture - on the basis that it might involve mentioning a competitor. This was despite the fact that these conversations will take place anyway and that to broaden and deepen the relationship it is necessary to acknowledge that the participants have a richer breadth of interest than simply the one product. Conclusions Our experience in this case reinforced to us a number of important points. Firstly it is important not to view a SM strategy as existing in isolation. It must be bound into a wider strategy, but the company needs to be ready and willing to respond to opportunities and challenges that may well be presented. This requires both logistical and cultural agility in some cases and so should not be undertaken lightly. Secondly communication within the organisation is as important as communication outside of it for it to be successful particularly in the short term. Thirdly building the asset for long-term value takes time and persistence but there are still short-term opportunities that can be garnered that can quickly demonstrate ROI. Finally it is imperative that at a cultural level the organisation both understands and embraces the mindset that underpins SM, and that this is in fact much more important than facility with the tools. Since this work, twintangibles has deepened further its experience in the sector and these lessons and our instincts have, we believe, proven to be correct and well founded. The community we established with the client continues to grow and we are certain that with effective management it would have proven to be an immensely valuable asset for the client over time. 13
  • 14. Getting Something Brewing References Kaplan, A.M., Haenlein, M. (2010) “Users of the world, unite! The challenges and opportunities of Social Media”, Business Horizons, Vol. 53, No. 1, January-February, pp. 59-68 Journalism.co.uk (2010) Survey: small businesses don't have time to use social media to generate new business [online], Journalism.co.uk, http://www.journalism.co.uk/66/articles/538025.php Li, C., Bernoff, J. (2008) “Groundswell: Winning in a World Transformed by Social Technologies”, Harvard Business School Press Tapscot, D., Williams, A. (2007) “Wikinomics: How Mass Collaboration Changes Everything”, Published Atlantic Books 2007 twintangibles (2010) [online], Twintangibles – IP & IA in the Social Media Age (as presented at IFKAD 2010, Matera, Italy, June 2010), http://twintangibles.co.uk/resources/ (accessed 3 May 2011) twintangibles (2011a) [online], Scottish Craft Breweries use of Social Media – Survey Summary, http://twintangibles.co.uk/resources/ (accessed 3 May 2011) twintangibles (2011b) [online], Micro-breweries go social…or not – Summary pf findings from a survey of Scottish Micro-breweries’ web social life, http://twintangibles.co.uk/resources/ (accessed 3 May 2011) Wright, T., Watson, S., Castrataro, D. (2010) [online], To Tweet or not to Tweet, that is the question – Social Media as a missed opportunity for Knowledge Management (as presented at ECKM 2010, Vila Nova de Famalicão, Portugal September 2010), http://twintangibles.co.uk/resources/ (accessed 3 May 2011) 14