Dive Brief:
- ZX Ventures, the incubator arm of AB InBev, has acquired full control of the beer rating website RateBeer, according to a post on the company's site.
- The venture capital incubator took a minority stake in the website in 2016, which sparked questions among beer brands about conflicts of interest, Just-Drinks reported.
- "After ZX Ventures took a minority investment in RateBeer, we were able to make improvements to infrastructure, put out an in-house mobile app, and modernize key pages that as the only full-time employee with help from some amazing admins and volunteer coders I was never able to tackle," Founder Joe Tucker wrote in the post announcing the investment.
Dive Insight:
About 19 months after AB InBev took a minority stake in RateBeer, one of the most successful and well-regarded peer beer rating websites in the world, the beverage giant has decided to fully acquire the business. Its involvement in the independently rated site caused a stir two years ago, and now there are even more questions as to whether the full acquisition presents a conflict of interest.
At the same time, a perceived conflict of interest could be just that: perceived. Other companies successfully navigate the same potentially murky waters. For example, The Washington Post is owned by Amazon mogul Jeff Bezos, but the publication regularly covers Amazon critically and discloses ownership in every mention to avoid a conflict of interest. In turn, Bezos has refused to capitulate — personally and through the newspaper's editorial decisions, which he has no say in — to threats based on his ownership.
While the same scenario could be the case for RateBeer, there has been no indication of transparency to alleviate those fears.
After AB InBev purchased the minority stake in RateBeer.com in 2016, it took almost 12 months for that information to be disclosed — and that only happened because another craft beer news site discovered the investment. Although the site founder announced this acquisition publicly on the website, its past issues with transparency could be cause for concern for its users. Even now, RateBeer has no mention on its main page about its connection to AB InBev.
What harm could AB InBev really do if it owns RateBeer? There is the obvious, such as manipulating ratings, but there are also less blatant ways the company could promote its own products by retooling how items are listed and searched for or who, if anyone, is allowed to advertise on the page.
This is especially important because many stores carry RateBeer shelf tags to help guide consumers in their craft beer purchases. According to Nielsen, 70% of purchases are made at the shelf — that is to say most beer shoppers come to the store undecided and rely upon product packaging, including RateBeer ratings, to make their final decision.
As of yet, there is no evidence that Big Beer has tampered with the rating system. Still, many enthusiasts have made it known that they will migrate to other sites rather than remain participants in RateBeer.
Sam Calagione, the founder of Dogfish Head, went as far as to make a public statement saying he was "troubled" by AB InBev's investment in RateBeer, calling it "a blatant conflict of interest." In a blog post, Calagione asked AB InBev to remove all Dogfish Head beer reviews and mentions on the RateBeer website immediately following the announcement of their minority stake.
Offline, independent brewers have continued to fight against the encroachment of Big Beer through the introduction of a Brewers Association seal that indicates craft beers that have been brewed by independent brewers. This seal is not available to craft beers that have been acquired by the big breweries.
It seems that beer lovers are paying attention to the encroachment of Big Beer and consciously supporting their small, local breweries. According to Beer Marketer's Insights statistics reported by The Wall Street Journal, 5,000 small breweries that shipped fewer than 100,000 barrels a year had an average volume growth of 14% in 2016. Growth in the rest of the craft brew sector has slowed considerably. Still, if independent breweries and rating sites continue to be devoured by large corporations, it may become more difficult to find those authentic brews that have made craft beer so wildly popular.