Getting the bird

Regular readers will know that I’m an enthusiastic user of Twitter. In recent weeks, there has been a mixture of excitement and consternation following the $44 billion takeover of the platform by billionaire tech entrepreneur Elon Musk. I’m no cheerleader for Musk, and in some respects he seems more of a loose cannon than a knight in shining armour. After peremptorily sacking a substantial proportion of staff, there was much speculation that the platform might fall over, but that hasn’t happened, and indeed Musk has reported record traffic and user numbers.

Many of the dismissed staff seem to have been engaged not in actually running the site, but in “content moderation”, i.e. censorship. It was widely felt that the previous regime on Twitter had pursued a very heavy-handed and partisan approach to throttling and banning accounts expressing conservative viewpoints or questioning the official narrative on Covid and lockdowns. People felt that they were constantly walking on eggshells, and many accounts have been suspended purely for the opinions expressed.

Musk has said that he will give an amnesty to all banned accounts with obvious exceptions such as illegal conduct and harassment, and they seem to be slowly returning, most notably that of former US President Donald Trump, although he has engaged in his own subtle form of trolling by not actually tweeting anything so far. Another is the satirical account The Babylon Bee.

Some people, alarmed by this sudden outbreak of free speech, have taken refuge in an alternative platform called Mastodon. Now, I don’t know much about this, and have no intention to open an account, but it appears to be a decentralised network of servers, each of which applies its own policies. I have already heard reports of heavy-handed moderation, and of someone being banned for supposedly being “a capitalist”. And surely, if the whole thing links together, there must be problems when someone on one of the more tolerant servers ends up interacting with those on one of the more censorious ones.

A platform like Twitter needs a critical mass to succeed – there is no point in being there if all you’re doing is shouting into a void. This is likely to be a problem for Mastodon, just as it was for conservative-minded people who set up accounts on Gab, Parler or GETTR. Maybe some parts of it will become a cosy echo chamber for like-minded people, but that’s really missing the point. And if you are trying to operate two accounts in parallel it becomes more like hard work and you will lose some of the spontaneity.

It must be remembered that the key point about free speech is that it needs to be extended to people with whom you profoundly disagree, and indeed whose views you may find obnoxious. If it is only allowed to those you find congenial, there is no free speech. And a key feature of Twitter and similar platforms is that you can tailor it to your own tastes by your choice of who to follow, and who to mute or block so, if you so choose, you never need to be exposed to opinions that make you feel uncomfortable.

It’s also worth mentioning that Musk has reportedly carried out a major crackdown on the exchange of child porn material through Twitter, which apparently had been widespread under the old regime, although I have to say it’s not something I’d ever noticed personally.

Think of the children

The Scottish government must be disappointed by the effect of the raft of anti-alcohol measures they have already introduced, so they have decided to double down by launching a consultation on restricting or banning alcohol advertising. The full document can be read here. It covers a variety of options from prohibiting sports sponsorship all the way to placing alcohol products behind curtains in shops as with tobacco. It’s unlikely that all of these measures would be implemented at once, and in any case in a national market the scope for Scotland-only curbs is limited, but the desired direction of travel is clear.

I’ve written about this at length in the past, so I don’t propose to go over old ground. But it’s generally accepted that the primary function of all advertising is to encourage brand switching and to bring new products to the public’s attention. The effect on the overall level of demand for the category is minimal. This is especially true of problem drinkers, who will go for whatever they can get their hands on at an affordable price. Over time, removing alcohol brands from the general public consciousness might have a moderate effect on dampening demand, but it would be a very slow process. We can see this with tobacco where, despite a total advertising ban, above-inflation price hikes and severe restrictions on where it can be consumed, the total level of sales has only gradually declined.

The authors of the document seem particularly concerned about the impact of advertising on children, and indeed have come up with a cringe-inducing “easy-read” version of it, from which the image above it taken. Being exposed to alcohol images apparently has a pernicious effect on children, even though they must regularly see people drinking in pubs and restaurants.. But surely young people start drinking alcohol because they are introduced to it by family or peer group members, not because they see a poster for Madri or Smirnoff. It seems to be a case of recruiting children as soldiers in the war on alcohol.

The public health lobby must be well aware that they are exaggerating the impact of advertising restrictions on consumption levels. But it serves their purpose to foster a climate of moral panic to promote a long-term process of denormalisation.

Some smaller producers may have a sneaking sympathy for measures to prevent sports sponsorship and TV advertising. Surely that will hurt the big players and help the little guy. But that is embarking down a dangerous road. Advertising restrictions will always work against new products and new entrants to the market, and reinforce establish brands that people are familiar with. They serve to ossify the market in its previous form. Tobacco brand choice now relies entirely on word-of-mouth and folk memory of how things were before the ban. It would be completely impossible now for a new company to enter the market, or to introduce an entirely new cigarette brand.

Drinks retailers have reacted with alarm to the prospect of having to put alcohol products out of sight. And it should not be forgotten that whisky is Scotland’s biggest export earner, and I can’t imagine the industry being particularly pleased about being prevented from advertising their product in its home country.

Losing your deposit

Next August, the Scottish Government will introduce a Deposit Return Scheme under which buyers of all glass and plastic bottles and cans used to package drinks, both alcoholic and soft, will be required to pay an additional 20p deposit which they will be able to reclaim when they return the empty container, the objective being to achieve a substantial increase in the recycling rate. While this is well-intentioned, it is likely to cause significant practical problems for both businesses and consumers which is the last thing they need at a time when everyone is struggling with a cost-of-living crisis.

Any business supplying these products in Scotland will incur additional costs in designing Scotland-specific packaging, as obviously the affected items will need to be clearly identifiable. The two categories of product will then need to be kept separate in the distribution chain. Some producers for whom Scotland only accounts for a small part of their business may well conclude it is no longer worthwhile to supply it at all, thus reducing the choice for Scottish consumers.

Retailers will need to adapt their point-of-sale systems to cope with the deposits, and there is also an unresolved question as to how they will be treated for VAT purposes. They will have to separately account for the revenue and pay it over to the government. And there will be further administration associated with repaying the deposits on returns, and storing them until they can be collected. The collections will require the creation of a whole new logistics system. Fortunately many smaller retailers have now been exempted from the need to act as collection points.

It’s all very well saying that you can reclaim the deposit when you return the container to where you bought it from, but it’s not always as simple as that. If you have a car and routinely drive to the supermarket it may not be too much trouble, but you will still have to gather the containers together and queue to have them redeemed, particularly at busy times. Each container will need to be individually checked to confirm that it falls within the scheme. With the best will in the world, there will inevitably be many car trips specifically undertaken just to return drinks containers.

There will inevitably be pressure to sign up to some kind of scheme to have the refunds paid directly into your bank account, which will further undermine the use of cash and result in more tracking of people’s activities and movements.

If you don’t have a car, you will have to physically lug all your bottles and cans to a collection point, or get someone else to do it for you. If someone else does your shopping for you, it creates a layer of negotiations between neighbours and relatives as to how the deposits are handled. If you give someone a gift of a bottle, you’re effectively gifting them the deposit too.

Where groceries are ordered online and delivered directly to the home, presumably there will be an expectation that the delivery driver will have to collect the empties too and arrange credit to your account, as it would clearly be unreasonable to expect shoppers to physically return them somewhere. That, though, will make the logistical task of deliveries much more complex, with an inevitable increase in costs.

While in theory you will be able to reclaim the deposit and so not be out of pocket, increasing the headline price of products will produce the perception that the cost of living has gone up even more. There is a question mark over whether it will affect the official inflation statistics. And it will undermine Scotland’s minimum alcohol pricing scheme by increasing the headline differential across the border. The sticker price of a 20-can slab of Tennent’s Lager will be a further £4 cheaper in Carlisle than in Dumfries.

Obviously I don’t live in Scotland, so won’t be directly affected. Currently my local council gets me to collect all bottles and cans in a brown bin which is collected monthly. There may be a question mark over how many of them actually get recycled, but it isn’t particularly onerous and seems to work smoothly. They would still need to do this, as it covers a lot of items such as milk cartons and coffee jars which won’t fall within the scope of the DRS.

I would need to separate out the items with deposits and then store them securely within my home, as their value would make them attractive to thieves. From my point of view, it would make life much simpler if someone, either the council or a private company, could collect all the deposit items directly, even if they charged a commission on it.

Many of the most thorny issues revolve around online ordering and delivery, which particularly affects the small brewery sector. I’ve not been able to find any clear answer to this in the literature I have read, but I would assume that any deliveries physically made from outside Scotland would be excluded from the scheme, as otherwise it’s likely that many vendors would simply refuse to supply Scotland entirely because of the cost and administration involved.

However, that isn’t an option for small brewers in Scotland delivering directly to customers, and that is what SIBA have been rightly concerned about and have made strong representations. Apparently the legislation includes a requirement to arrange for physical takeback of online orders, which seems completely impractical in general, but particularly for small producers. It does seem that they have achieved some progress on this, but there is still a long way to go.

“It is therefore encouraging that the Scottish Government has today recognised some of the issues facing the scheme in the Emergency Budget Review and have indicated a willingness to amend the online takeback element which currently would prevent any small producer from selling online in Scotland next year.

“However we would urge the Scottish Government to look again at the requirements for small producers which, as currently designed, are threatening business closures and jobs in Scotland and will lead to reductions in choice and an increase in price. Many small breweries have already told us they will have to stop selling beer in cans and bottles in Scotland because of the multi million pound costs of the scheme to small producers.”

Maybe there needs to be an exemption for smaller producers based in Scotland, which would predominantly be brewers, although inevitably there would be grumbles about unfair competition and edge effects.

It may be that all these issues prove to be just teething troubles, and the system will work well enough once it is bedded in. However, given the SNP government’s past track record on delivering such projects, I wouldn’t hold out too much hope.

Last orders for lout?

At the beginning of this year, Wetherspoon’s carried out a substantial revamp of their beer range, one of the major elements of which was delisting products from the Heineken Group. This meant the disappearance of two 5.0% ABV draught lagers, Heineken itself and Kronenbourg 1664, leaving the only product remaining at that the strength as San Miguel, owned in the UK by Carlsberg.

5% premium lagers were once one of the leading segments of the British beer market, but recently seem to have become very much eclipsed. What was once its flagship brand, Stella Artois, has been reduced in stages from 5.2% to its current strength of 4.6%. The draught lager range in my local Spoons is now San Miguel, Stella, Corona and Budweiser (both 4.5%), the “premium standard” Coors at 4%, Carling (4%), Carlsberg (3.8%) and Bud Light (3.5%)

There’s nothing inherently wrong with beers of any particular strength, although it’s probably fair to say that few beers are improved by being made weaker. Obviously there is a duty saving to brewers, but it may well be that less strong premium lagers suit customer preferences in making them more sessionable and keeping a slightly clearer head.

When I have written about this in the past, I have suggested there might well be some degree of customer kickback, but this doesn’t seem to have happened. But, whatever the motivation, it certainly represents a major shift in the beer market. There has been a similar movement in the cask market, where beers of 5% and above don’t find many takers nowadays, and a number have had their strength cut.

A new product category has been devised for these products – Mediterranean Lager – which encompasses those of both Spanish and Italian identity. To get a share of the action, in 2020 Molson Coors launched a new product, Madri Excepcional, which has been very heavily promoted in the succeeding two years. While this may appear to be of Spanish origin, it is in fact an entirely concocted brand that bears no relation to anything actually sold in the Spanish market, as explained in this article, which is basically a recycling of a press release.

This will cause much harrumphing amongst those still outraged by the fact the Wainwright is brewed in Wolverhampton, but the fact of the matter is most drinkers are no longer particularly concerned about authenticity and provenance, as I wrote back in 2011. This is a point reinforced by this article hanging on the recent closure of Jennings. Nobody is being deceived, as having a product with the vague trappings of Spanish or Italian style is sufficient. There are plenty of examples in the general food and drink field of products that lay claim to a particular national identity but in fact have little or no presence in their supposed home markets.

I was recently in my local convenience store where the two lager brands being heavily promoted were Madri and Moretti (owned by Heineken), both 4.6%, which certainly would not have been the case five years ago. And I suspect in the current climate it would be very difficult for any major brewer to launch a new mass-market 5.0% lager brand. If you do want an authentic British 5% lager, though, you could do a lot worse than Samuel Smith’s Pure Brewed.