Boston, Bars, and Digital Technology

Home to over 250,000 college students and technology powerhouses such as MIT and Harvard, Boston is known to be a hub of digital technology. However, when I think of the bar scene in Boston, “high tech” and “digitally progressive” aren’t the words that come to mind. I think that to a certain extent, bars should remain fairly separate from technology. Nonetheless, it is interesting to explore the opportunities surrounding digital technology and the bar/ nightclub industry.

Back Office Management/ POS

Back office management is the key to strong operations in the bar/nightclub industry. From scheduling shifts to analyzing inventory, there are several restaurant management software systems that have made businesses incredibly profitable. In fact, the restaurant management software industry has been thriving in past years due to the benefits a superior system can bring to a restaurant/bar/ nightclub. Software companies such as Toast POS are making bars more efficient so they can focus more on the consumer experience. The photo below is from Toast’s website, showing the benefits of the software:screen-shot-2017-02-25-at-12-21-59-pm

Back office management and POS are being widely adopted by bars and nightclubs because the advantage is very clear. Other stages of the operation, such as marketing and front of bar service are more complicated and pose greater challenges.

Marketing

How do bars/nightclubs become popular? Whether it’s the cocktail menu, music/ DJ, interior design, or the general vibe of the venue, there are so many variables in this industry. Understanding the market is crucial for a bar to be successful especially in a place like Boston where there are hundreds of options. I would go as far to say that word of mouth is the strongest factor in deciding what bar to go to. Many bars around Boston have realized how important this marketing technique is, despite all the other ways they may be able to market to consumers. I am much more likely to trust a friend who said they had a great time at a bar than I am to believe a bar’s advertisement. Furthermore, this is why promoters and event-based marketing is successful especially during college. For example, often times a student at Boston College will work with a bar to sell tickets to an event or to have special promotions. This technique is effective because it plays into network effects and the trust involved in WOM marketing.

It is unclear to me what more bars/nightclubs can do to improve their marketing. By keeping up with social media trends, especially the capabilities on Facebook, bars/ nightclubs can organically be a part of their patron’s lives and attract new patrons. Notice how Tavern in the Square Allston utilizes the “Book Now” button, posts Tasty-like videos, and engages with users on Facebook.

screen-shot-2017-02-25-at-2-32-20-pm

Bars use several techniques other techniques to appeal to their market such as naming drinks after famous athletes, appealing to a niche market, hosting popular/ local DJs, and hosting game nights/ theme nights.

Bar & Front of Bar: The Consumer Experience

shell-energy-lab-2015When you go out, you are not typically thinking about how digital technology is impacting your experience, or how it can enhance your experience. Advanced sound systems, unique lighting, interactive walls/ tables, sustainable dance floors, and other aspects of the consumer experience are all features of bars/nightclubs of the future. There are many bars/ nightclubs that have the potential to utilize digital technology but do not. I would assume this is partly due to the low-profit margins in this industry.

blast825-beerwall-768x520A widely used technology is self-serving drink machines. Examples include iPourit and Enomatic Wine Serving Systems, which allow patrons to serve themselves. iPourit claims that this technology increases profits, improves bar operations, eliminates keg loss, attracts a curious customer, and provides actionable data. This use of digital technology in a social setting gives way to an enhanced consumer experience and the opportunity to be creative.

As I said before, because Boston is an east coast tech hub, I would assume that bars around here would be more progressive. This is not something that I have experienced first hand but would be curious to see if others have had a different experience.

Other Ways Technology is Impacting Bars/Nightclubs

There have been several moves to integrate technology into the bar/ nightclub scene.

  1. The Beer Mapping Project, which aims to help people find good beer, uses the Google Maps API and website visitors to create a database of locations. This service is almost like a niche Yelp app. screen-shot-2017-02-25-at-12-09-30-pmIt brings together people who are passionate about good beer and want to help others find good beer also. Through check-ins, reviews and photos, the site provides valuable information. It also suggests beer routes for people who are looking to do a bar crawl-esque event.
  2. Mobile ordering for drinks at a bar is an idea that in theory is great, but has never actually gained the popularity/ adoption needed. In fact, Flowtab, an early attempt at mobile drink ordering, keeps its website live to use their failed start-up as a learning experience for others. Mobile ordering for bars is far more complicated than the mobile ordering we see at Starbucks and Dunkin’ Donuts because the bar/ nightclub industry is highly fragmented. The mobile ordering platform required opt-in from numerous bars just to make it worthwhile for consumers. I still have faith in the idea of mobile ordering at bars/ nightclubs because waiting online to order drinks at the bar is a huge source of consumer pain. The technology is available but there are many obstacles to face in this industry.
  3. Roo: real time night-life guide for bars and clubs. This app intends to help people see what’s happening at the local bars. It requires strong a network effect because the information is generated through other people’s feedback. This app, in theory, is great but has not truly kicked off. I will certainly be paying attention to it because I think it has great potential.

Final Thoughts

The combination of digital technology and the bar/ nightclub industry is an interesting topic because I think we will begin to see more and more technology integration in the upcoming years. There will always be bars that remain true to its routes, using antiquated POS and music systems. These bars have their own kind of charm (I think we all can think of a bar like this) but will need to consider technology as people continuously demand a better consumer experience.

8 comments

  1. This is such a great way to look at how technology affects some of the most prevalent parts of a student’s life. I agree that using SM for marketing is a bit tricky for some of the bars, and given that they are packed on the weekends regardless, SM promotions is not even necessary for them. But they can also try and leverage SM to “pack” the establishment on other days of the week too, by communicating promotions, specials and other events. Some other things that can be tackled with technology could be line management or some kind of a social tool that would show if you have any friends around trends.

    Also, check out BevSpot, it’s an inventory management and analytics software company for bars based out of Boston!

  2. This was an interesting topic to write about. I can see how transitioning towards using more social media could be a difficult change for many bars, but I agree that those changes could really improve customers’ experiences. For example, Flowtab seems like it would be really beneficial, so I wonder what improved version of that idea will happen next.

  3. Nice post! I like how you explored the front and back end impacts of digital business and the bar industry in Boston. Plus I learned about 2 new apps Roo and the Beer finder- which I am definitely downloading. Roo reminds me of WAZE a little bit and I do see opportunity there. Challenges are that people typically go where they know and are comfortable so half the battle for establishments is getting folks in the door. Creating a presence on Social Media will help.

  4. This was a very interesting read on a topic a lot of us rarely think about it. I personally take for granted my experience at bars and hadn’t considered how technology could improve experience for customers until reading this. I absolutely believe bars would benefit from the use of mobile ordering and self serving technologies to improve the amount of time customers have to wait for service. My friends frequently use the amount of time you have to wait to be served as a reason to not go to a particular location, even if that is where our friends have said they are going. Technology provides bars with ways to not only help gain more customers but also to ensure their current customers aren’t driven away.

  5. This post was really interesting and relevant to many students in the class! One of my friends was just talking about wanting an app that tells you the length of the line at certain bars, especially in cold Boston winters, but we also discussed how like some of the apps you mentioned, those are better in theory than actual practice, since they rely on other people to input the info in real time.

  6. For an example of the SF nightclub approach, you can check out SURV, a mobile app that allows users the power to book bottle service at nightclubs on their phone, and addresses this pressing desire for convenience and speed. It’s interesting that in NYC, bars are seeing a trend towards lower consumption of alcohol as consumers (particularly millenials) become more and more health conscious. A great way to combat this hit to the bottom line will be to give millenials what they want: speed and convenience so that they can order a drink/go to a bar before they even have time to contemplate going to the gym/juice store instead.

  7. Great post. I hadn’t really thought that deeply about digital technologies and bars, but you make a compelling case for the relevance. Nice work!

  8. Interesting post! As I was reading I was thinking about some of my friends who have become bar/club promoters here in Boston and have the ability to make hundreds of dollars on a bar event by simply posting something on facebook and inviting everyone they know to it. When I told my parents that they make good money doing it they thought it was absolutely absurd because everything they knew about bars in college was just word of mouth. Interesting to see how social media has even changed how we experience our nightlife

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