What’s the purpose of a wine label; or for that matter a label on spirits and beer? Obviously, the first response to that question is: to satisfy the TTB (Alcohol and Tobacco Tax and Trade Bureau) regulations. Once that is accomplished, the label space remaining may be used for branding and marketing copy. The fact is, there is very little space on bottle labels to get creative with messages. Now technology is helping solve the limited space on labels by way of RFID (radio frequency identification/ID) technology. Tap a smartphone on a NFC (Near Field Communications) tag embedded on a bottle and see what comes up on your smartphone; assuming there is currently a tag on the label.
Depending on a winery’s budget and the number of smartphones enabled with RFID tag readers (newer smartphones have built-in reader capability), wine, beer and spirits producers can communicate directly with the consumer while they are standing in front of the bottle or can. These electronic tags can impart information in any format. The information can be audio, a message or automatically opening a website page; the choice is up to the winery or craft beverage company. The most economical tag option is to use NFC tags embedded in a label or a very thin flexible film adhered to a bottle.
This NFC technology has different names such as Smart Labels, Tags, and OpenSense Tags; the moniker I use is “Tap Tags”. Smart Labels (originated in the consumer products industry) are starting to appear on food, personal care and pharma items. Although extremely limited, spirits, beer and wine are recent joiners. In fact, companies using smart label tags are not just the big players in the food and personal care space but are also used by small start-ups. Basically, tags are a means for producers of products to give the consumer more information than is possible to print on a label. But, the benefits of such tags aren’t just in dispensing more information, it is also about branding, loyalty, increased sales, etc.
QR codes have been around for decades. They can do some of the operations a NFC tag can perform but are limited. More on QR code versus NFC follows.
Twenty years ago, I was involved with a gentleman who is an expert integrator of RFID (radio frequency identification/ID) tag technologies for casinos. His patented technology is used today in allowing casinos to authenticate and track their gaming chips within a casino. Ken Smith, writing for Blackjackinfo.com on November 5, 2012 reported that Wynn/Encore Casino’s in Las Vegas starting using chips embedded with RFID tags in 2005. Point being: the level of sophistication offered by “tag” technologies allow companies to communicate with consumers, even before they buy the product.
Decades ago barcodes started allowing companies the means to track inventory, monitor parts and adjust pricing instantly. Then RFID tags came along which expanded the capabilities of product monitoring passively and actively; reading and writing information to a RFID tag. Depending on the capabilities of an RFID tag, information can not only be read from a tag, but that tag can also be written to; adding more/different/updated information on the tag. We don’t want to forget the QR (Quick Response Code) that most smart phones can read optically and provide an on-screen response via a link to a landing page. The QR code, invented in 1994 has a similar application as the barcode. Smartphones today come with QR reading capabilities and more recently antenna to communicate with NFC tags.
A derivative of RFID technology that is gaining acceptance rapidly is the NFC tag. A strong proponent of NFC technology is coming from Grocery Manufacturers Association and the Food Marketing Institute-the SmartLabel™ group. They formed an alliance called Trade Partners Alliance to explore ways to be transparent with quick, reliable, actionable, in-depth product information for the consumer. One of their applications involves NFC tags which takes the consumer, via their smartphone, to a navigational landing page. All the consumer is required to do is tap their smartphone on the NFC tag on the product packaging.
Noted previously, most product packaging has limited space for details. The real estate available on a printed wine label may not be enough to provide a plethora of information options various consumers are interested in and/or need. Solution: why not make it possible for a consumer to tap their smartphone against a “tap tag” on a product and instantly be taken to a URL/website/landing page that allows the producer to communicate (in print, video or audio) with a potential customer concerning the product. An adage I hear a lot: You can do anything with enough time and money. Same adage applies to NFC technology. For our discussion I am taking the quickest and most creatively flexible approach to new label technologies; the NFC tag, while not totally forgetting QR codes.
This brings us to the “here and now” concerning new technologies that allow producers of wine, spirits and beer to communicate directly with their customer. I am talking about NFC (Near Field Communications), a technology application already being explored by Diageo, Coronado Brewing, and a winemaker in Spain (Barbadillo Wines). In December 2017 Astral Tequila will feature NFC technologies to promote in-store consumer interactions. It has been reported by one integrator/manufacturer of NFC applications, an alcohol product company realized a 30% increase in conversion rates when testing their foray into NFC label tags. Yes, NFC is part of many label options that can be very transparent to the consumer.
A NFC type smart label is actually a RFID tag that is about as thin as 3 sheets of printer paper or.0002 inches. When labels, with embedded NFC tags, are tapped by a NFC enabled smartphone, the phone receives pre-programmed information. For example, the user may be directed to a predetermined site. The website/landing page the consumer is directed to can be designed as a winery, brewer or distillery deems appropriate. The information in the NFC tag can be approximately 7K in size. Again, larger and more capable RFID tags can offer greater capabilities and much more capabilities, but at more expense and involved integration.
One manufacturer of this technology that demonstrated the NFC options for me was Metal Craft. “The options for NFC to communicate with customers in the beverage industry is mind boggling,” said Austin Elling, Marketing Manager-Metal Craft. “Here are some examples of what can be programmed into one of our NFC tags: vCard to import data into the address book, URL to open a given web address, plain text to display simple messages on a smartphone, telephone numbers to initiate a call, geo location to open a specific destination,” says Elling. “For alcoholic beverage business, my experience says that branding and creating direct communications with a customer is in the NFC sweet-spot. A winery may decide to use NFC capabilities for a loyalty program, announcements, promotional trials, initial trials, wine clubs, etc.”
Digressing for a moment. Recently, Anheuser-Busch launched a new Tequila flavored beer branded as Oculto Beer. The label on the beer was embedded with a tag and battery that lit up the eyes on the skull logo on the label. They positioned the switch where most people would gab the bottle. Obviously, it was creative and very expensive. Unfortunately, consumers bought the beer for the novelty of the label technology; consumers did not like the Tequila flavor and it failed.
Relatively inexpensive, NFC tags can only be read at extremely close range, which is why the label area containing the tag needs to be tapped with the enabled smartphone. Some more expensive and capable RFID tags can have a read/write range of approximately 200 feet. However, at approximately $0.10 each, NFC tags are affordable. The price however does not include set-up costs and integration with the back-end landing page. Nathan Chandler writing in “How Stuff Works” reports, “Memory capacity and speed dictate tag cost, which is a critical consideration for companies that want to spread information far and wide through smart posters or flyers… labels. Right now, tags cost around 30 cents apiece even in bulk, but the price should continue to drop until they’re only a few pennies each [source: NFC Rumors].”
Why would a winery, craft brewery or craft spirits company invest in a new label endeavor? Here are some immediate marketing applications that come to mind:
· Protect the integrity of their brands
· Build a comprehensive loyalty program and brand awareness
· Source for consumers to obtain product reviews
· Detailed product information-tasting notes, retail locations, AVA’s, information about winemaker, DtC (Direct to Consumer) pricing
· E-commerce centric efforts
· Customer surveys
· Encourage wine club and newsletter sign-ups
Coronado Brewing in Coronado, CA found consumers were intrigued with their use of NFC technology (tap tags) embedded in their coasters; “consumers were keeping the coasters to show friends,” reported Coronado Brewing’s Marketing Dept. press release. Coasters are a unique use of NFC tags, because the craft beer industry is all about building brand trials, positioning the beer as being handcrafted and artisanal, and explaining quality. The coaster application certainly achieved the greater objectives. Coronado Brewing know they must be real, accessible, authentic, and back it up by delivering the message with and experience of being new. Once a brand wins loyalty, the brand wins, states the company’s marketing material.