alcobev industry | Ambrosia India

In 2019, Swedish whisky distillery Mackmyra released Intelligens, said to be the ‘world’s first’ whisky created using AI. Mackmyra collaborated with Microsoft and a Finland-based tech company – Fourkind, and using customer feedback data, they created AI algorithms which picked up recipes that were a delight for the end-consumer.

Microsoft, IBM and other tech companies are active in alcobev

Microsoft, IBM and other digital technology players were making significant forays into the alcobev industry. And the big boys of the alcobev industry soon realised how transformative this could be for the industry itself. They had seen the dividends the retail sector was earning and one by one, they started introducing digital technologies in their processes and the going has been good. Microsoft pitched to Danish multinational brewer Carlsberg for the ‘Beer Fingerprinting Project’ and the two used machine learning to good effect. They fed with beer ingredient characteristics to map out and predict beer flavours, shortening the time it takes to develop new beers. Then there was US-based Sugar Creek Brewing Company which tied up with IBM to use AI to improve its beer manufacturing line where there was a monthly beer spillage amounting to $30,000.

Diageo’s ‘What’s Your Whisky’ is so so customer-centric

One of the global leaders in alcoholic beverages, Diageo launched ‘What’s Your Whisky Selector’, an innovative digital experience that has found favor and flavor with many a whisky connoisseur. What did ‘What’s Your Whisky’ do? It simply used AI and ML to analyse customer’s flavour preferences (variety of sweet, fruity, spicy and smoky flavours found in Single Malt whiskies) and recommended a Single Malt whose flavour profile most closely matched the customer’s taste. Customer delight is something no company would want to miss out on. Diageo rolled-out this experience in Great Britain, Germany, Austria, Switzerland, Spain, Greece, Belgium, Denmark and the Netherlands. Ok, it is not available in India which boasts of the largest base of whisky drinkers! Diageo said that intelligent automation is deployed in over 100 applications across its business. “Through predictive analytics, machine leaning and robotics process automation, we are growing more productive and more competitive.”Around the same time, other alcobev behemoths such as Beam Suntory, Bacardi, AB InBev, Pernod Ricard and others had also started putting their money on AI, ML and robotics to enhance manufacturing and operational processes and importantly on introducing a new dimension to customer experience.

A lot is brewing in AB InBev’s Beer Garage

Belgium-based AB InBev has something brewing in its ‘Beer Garage’ wherein machine learning is at play. AB inBev has invested in data-driven solutions to help improve beer brewing on the production side, while on the customer side, it is enhancing its customer engagement programme. The world’s largest beer maker (Budweiser, Stella Artois, and Corona) is using low-cost sensors and machine learning to predict malfunctioning in its brewery, getting to fix it before it happens and thus avoiding huge downtime. Beer Garage is scaling the company’s existing capabilities in AI, ML, Internet of Things, Cloud & data analytics, automation and robotics, and exploring emerging technologies such as Blockchain, AR & VR and others. Innovation at AB InBev drives its commercial strategy, supply chain, and is building sustainable business to improve lives in communities around the world. These technologies are providing the company with unprecedented insight into the needs of its consumers and customers and supporting the growth of the beer category.

Beam Suntory Mexico plant uses drones in agave fields

Beam Suntory, the world’s third largest premium spirits company, deployed drones and AI in its Casa Sauza project. Drones helped the company get an accurate inventory of the agave (Tequila) plants in the fields and to reduce the time it takes to complete the inventory. An AI process is applied to ensure only agave plants, not weeds or any other material, are counted. The inventory data is loaded and tracked in the Sauza Blue Harvest application and later transferred to SAP for SKU tracking. The drone technology is used to manage, monitor and increase crop productivity, and to assist in diagnosing the health and vitality of the agave plants. Beam Suntory is also using digital manufacturing from Rockwell Automation and Cisco to overhaul its business models, improve efficiencies, streamline logistics and update its network. “The future’s promising for Beam’s IT infrastructure and for our networks, and how we can leverage automation and productivity, improving our flavours and our brands. It’s very important to Beam, and I think we’re really moving forward in a good direction,” said Amon Hogue, Senior Network Architect at Beam Suntory.

Pernod Ricard Winemakers gets accurate grape yield

Early this year, Pernod Ricard Winemakers, the premium wine division of Pernod Ricard, took on board Complexica, a leading provider of AI software for supply and demand optimisation. It went live with Complexica’s Decision Cloud software platform in Marlborough, New Zealand in what is Pernod Ricard’s largest global technology project. It plans further go-lives in Australia for finished goods planning and production scheduling, followed by Australian and Church Road winery operations, which forms part of a wider programme of activity to enable the business to utilise technology to work faster, smarter and safer. Pernod Ricard Winemakers also engaged Trellis to support its business and supply chain operations by providing accurate grape yield, quality, harvest timing and procurement cost prediction across Australia and New Zealand.

Bacardi’s cool cocktail-making app

Bacardi this year launched a new cocktail-making app that has helped those who were dishing up new cocktail recipes during the pandemic. The app aims to reimagine the bar setting, besides giving bartenders a platform to showcase their talent. The app launched in the US and UK helped boost consumer confidence in making cocktails at home. Bacardi also signed up EPAM which streamlined the spirits manufacturer’s digital environment by implementing a digital platform for multiple brands including Bacardi rum, Grey Goose vodka, Breezer, Patron Tequila and more. The DevOps automation platform resulted in 16 times greater website development capacity, and a 42% reduction in infrastructure costs.

Digitization in alcobev still nascent

Though deployment of digital technologies is still in its nascent stages in the alcobev sector, there are a number of early adopters who have invested in digital technologies to not only create flavour profiles faster, but also for other functions, including packaging, logistics, marketing and other processes. It is no-brainer that AI has the power to transform the alcobev industry forever, albeit it is happening at a gradual pace. In fact, the pandemic has accelerated the pace of deployment of AI in the alcobev sector as online deliveries became common; home drinking was becoming the norm; and consumers were looking at new recipes. According to US-based FasTrax Solutions, total alcohol sales registered an increase of 25.5% in 2020, driven by digital marketing initiatives with AI at the core. It said in the US beer sales increased by 20.2%; wine by 30.1%; and spirits by 34.1%. Thanks to e-commerce, the sales figures are looking impressive in these difficult times. Also came along the virtual sommelier, guiding consumers on how to buy wine, how to grow vines and how to taste / judge them. In fact, some winemakers have started investing in AI in their vineyards wherein it gives insights into soil management, pest control etc. Experts believe that large vineyards will deploy drones to help growers manage their yield better. Robots will also be at work to improve efficiencies at the vineyard.

‘Smart factories’ the future

Capgemini, a global leader in consulting, digital transformation and technology services, has said that beverage manufacturing companies plan to build 40% more ‘smart factories’ in the next five years. It estimates that smart factories will contribute between USD 1.5 trillion and 2.2 trillion to the global economy. And what are ‘smart factories’? They are those that leverage digital technologies to gain significant improvements in productivity, quality, flexibility and service. Three key digital technologies enable the smart factor – Connectivity (collecting data from existing equipment and new sensors); Intelligent automation (drones, machine vision etc); and Cloud-scale data management and analytics. The alcobev industry, one of the oldest in the world, though maybe late entrant to the digitization mode, but has soon caught up. From robots to drones to AI to ML, technology is becoming a key driver for not just growth, but a new customer experience. After all, customer experience matters.

The petition has argued that the government cannot decide what a person will eat or drink inside the premises of one’s house. The petition has invoked the ‘Right to Privacy’ in challenging the prohibition law. The Gujarat government’s Advocate General Kamal Trivedi said the petition should be filed in the Supreme Court as the apex court had upheld the Act in its 1952 judgment. He contended that the law validated by the apex court cannot be overturned by the High Court.

Petitioners say matter should be heard on merits

The petitioners, however, argued that the matter should be taken up on merits, as the provisions challenged in the pleas are materially different from what they were in 1951 as they have been amended over the years. They added that the right to privacy was not recognised as a fundamental right in 1951 when the Supreme Court upheld the validity of the provisions in the prohibition law.The batch of petitions have challenged the constitutional validity of sections section 12, 13 (total prohibition on manufacture, purchase, import, transportation, export, sale, possession, use and consumption of liquor), 24-1B, 65 of the Gujarat Prohibition Act, 1949, and sought them to be declared as ultra vires Article 246 of the Constitution.The provisions are “arbitrary, irrational, unfair, unreasonable, and discriminatory…and despite prohibition being in place for more than six decades, a steady supply of liquor continues to be available through an underground network of bootleggers, organised criminal gangs and corrupt officials”, the petitioners who were represented by senior advocates such as Mihir Thakore, Mihir Joshi, Devan Parikh and Saurabh Soparkar said.“With expanding interpretation of the right to life, personal liberty and privacy, as contained in Article 21 of the Constitution, a citizen has a right to choose how he lives, so long as he is not a nuisance to the society. The state cannot dictate what he will eat and what he will drink,” one of the pleas said.

‘Right to privacy is a fundamental right’: SC

The Supreme Court in another judgment had held that the right to privacy is a fundamental right and is an integral part of the right to life and liberty. Privacy is a right to be enjoyed by every human being by virtue of his or her own existence. It also extends to bodily integrity, personal autonomy, compelled speech and freedom to dissent or move or think. The right to privacy is to restrain government and private actions that threaten or hinders the privacy of individuals.

Regulation, and not prohibition, is what Gujarat needs: Devan Parikh, advocate

Devan Parikh, one of the advocates to the petitioner in a YouTube post by Vibes of India, has put forth the argument that the petitioners are not “asking for the removal of the prohibition policy lock, stock and barrel. We are asking the government to draw a fine line.”He pointed out that advertising of liquor in many parts of the world is not based on the alcohol content or intoxication. “Alcohol is sold basically for its refined taste. The kind of liquor that was available (when prohibition was introduced in 1961), there was some justification to have a rider. But after all these years and the knowledge base we have, the law needs a relook. Petitioners are saying balance the liberty a person can have, the choice a person can have. If it has an ill impact, then deal with those issues. You cannot throw the baby with the bath water.”

Four walls concept clarified

He further mentions that the petitioners are clear that you cannot do anything within the four walls. “If that is the case, I can consume drugs, I can commit any crime within my four walls. The four walls concept is not very well understood in this case.” The petitioners believe that one should have the liberty to drink in a manner that does not impact society at large or have adverse social repercussions. Devan Parikh referred to the Constitutional provision of principle of proportionality. “The Constitution permits you to put reasonable restrictions on the exercise of your rights, in public interest, in the society, and in your own interest… those interests have to be balanced. There is justification to put restrictions, put it, but in present times, does it make sense to have total prohibition. There is need for regulation not prohibition.”

Prohibition needs a relook

Taking the argument further, he said the rest of the country where there is no prohibition, are there problems or not. Will Gujarat have more problems if prohibition is lifted? “We are saying with the passage of time, people are more entitled… Constitution is a live organ and that this issue needs a relook. When prohibition was introduced look at the kind of liquor that was available then and look at the fatalities at that point of time.”Terming it as contradictory, government giving liquor permits on medical terms, he asked “a person consuming liquor for health reasons, will he or she not get intoxicated.” A person can permit in Gujarat for an annual fee of nearly ` 4,000 and the eligibility is that he or she should be above the age of 40 and should have some medical condition. Visitors too can apply for a temporary permit, but not the residents of the State.

Gujarat in a Gandhian-bind

The problem with Gujarat is that it has a perception problem. Gujarat is a state from where Mahatma Gandhi came who considered alcohol consumption as a social evil. Gujarat is caught in a Gandhian-bind. Devan Parikh asks the logic behind the prohibition in the name of Mahatma Gandhi. “With no disrespect to Mahatma Gandhi, I would like to state that Gandhi died in 1948 and at that time there was no prohibition in Gujarat till 1961. What happened during this interim period to Gandhiji’s advocacy?Till such time the High Court gives its verdict, we are going to see a lot of heightened activity from both sides espousing their causes and social media is going to flame it further. Meanwhile, liquor (including spurious) will be available through various ‘underground’ channels in Gujarat, a state which has seen many deaths due to illicit liquor. In 2012, 143 deaths were reported from Gujarat in a hooch tragedy.

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Gujarat High Court admits petition challenging prohibition