Oct. 18 (Bloomberg) -- At Frank’s, a hipster hangout atop a parking garage in South London, drinkers keen for a Negroni or Aperol spritz had to line up for 25 minutes at the height of the summer season. Ben Floyd has a way to jump the queue.
Floyd is a co-founder of Bar Pass, an app that lets drinkers order and pay for a round at their table, then collect their beverages when the bartender has poured or pulled them. Frank’s says the app, tested at the bar this summer, cut wait times and helped boost sales.
“Apps like these aren’t about being lazy,” said Floyd, 30, a former trader at Bank of America Merrill Lynch. “People nowadays are so time-poor that anything you can do to squeeze them an extra few minutes helps.”
Bar Pass and competitors Q App, which is working with Nimax cinemas and London’s South Bank theater, and YQ? -- which says it’s been testing its technology in smaller London venues -- aim to revolutionize Britain’s cherished pub culture. In the U.S., apps such as Prio and Dash offer similar services.
British pubs conjure up images of snug rooms where customers play darts and savor pints of beer. The reality these days is different, as many former patrons have switched to drinking at home to save money or have cut back for health reasons. The U.K. beer market is set to fall 2 percent by volume this year after dropping 3.4 percent in 2012, according to researcher Euromonitor, and an industry group estimates that pubs are closing at a rate of 26 a week.
The British developers, who started working on their apps early this year, say they can boost efficiency behind the bar and shore up the industry by getting tipplers to spend more. And they say they offer new marketing opportunities for brewers and distillers such as Pernod Ricard SA, Diageo Plc, and Anheuser-Busch InBev NV, which could pay to place their brands at the top of virtual bar menus on smartphones.
“The end-game is about the relationships we want to foster with the big drinks companies,” said Darren Blake, a co-founder of YQ?, who says he has met with brewers and distillers, but has no deal yet. He suggests that beverage companies could use data from the apps to give drinkers of rival brands a discount on a similar offering of their own.
Pernod Ricard, the maker of Absolut and Chivas Regal, is “very open to mixing with startups and new tech services,” said Antonia McCahon, head of digital marketing -- though she didn’t comment on negotiations with any app makers. Diageo is similarly interested, said Venky Balakrishna, global vice president of marketing innovation, but “for every brilliant new app that provides utility and value to users, there are several more that don’t hit the mark.”
Bar Pass, which kicked off at Frank’s and The Queen’s Tennis Club in London and is expanding to venues such as the Royal Ascot horse races, says the 572 customers who downloaded the app at Frank’s spent an average of 40 percent more than those who don’t. Q App says sales are up at bars using its program, but didn’t provide details.
“You’re shaving the time it takes to order as well as to process the payment,” said Tim Bichara, a founder of Q App. “The trials we’ve seen so far show there’ll be a significant uplift to using this product” as bars serve drinks more quickly.
YQ? charges consumers 5 percent on top of their order. Bar Pass and Q App take a portion of the pub’s sales, and say the revenue benefits more than offset their charge.
The next step for app makers is trying to gain traction with companies running chains of bars. Q App says it’s in talks with “medium-level” coffee chains in the U.K. as well as a soccer club to help with drinks orders at the stadium during matches.
The services could meet resistance from customers who like face-to-face interaction, or from bartenders who feel it will distance them from patrons, according to Brian Blau, a technology analyst at researcher Gartner. Small cocktail bars, for example, thrive on interaction at the bar, but that’s less important in busy City venues on Friday nights, where the technology can replace sharp elbows.
The apps provide “a fairer queuing system, rather than how big or pushy you are,” said Blau.
The move to use apps in pubs is in keeping with mobile ordering in other areas, Blake at YQ? said.
“It’s modernization, it’s where humanity’s been going for hundreds of years,” he said. “I don’t go to Tesco any more -- I do it all online. It’s not laziness, it’s progress.”
Pubs may be keen to sign up, seeking to speed orders when drinkers are four- and five-deep at the taps, said Neil Williams, a spokesman for the British Beer and Pub Association, which represents U.K. brewers and watering holes. But ordering at the bar will prevail during slower hours, Williams said, as pub-goers like to chat with the barman and there’s little incentive to use a smartphone.
“The personal contact if you’re at your local pub with people you know -- that’s part of our tradition,” he said. “I still think that’ll be the predominant way people buy drinks.”
Nonetheless, there’s plenty of incentive to use the apps at peak times, said Frank Boxer, managing director of Frank’s rooftop. He said that after a trial run this summer, he plans to use Bar Pass for the entire season next year.
“The biggest problem we have is getting people served in a reasonable amount of time,” Boxer said. “The look of enjoyment on people’s faces as they walked past an enormous queue to get their drinks from the bar was amazing.”
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