When Proximo Spirits wanted to grow its 1800 Tequila brand, it turned to the internet, launching a web campaign that encouraged fans to design their own bottles. In just three months, the contest lured 600,000 unique hits and 11,000 original art submissions, according to digital agency LBi.
For a spirits marketer looking to expand its reach, the project -- which began in 2008 -- was an unqualified success, even making a list of accomplishments on LBi's website. But for public-health advocates, the online effort is just one more example of alcohol companies using the web to create relationships with users who may -- or may not -- be of legal drinking age.
"It's a digital-marketing arms race, and alcohol companies, like any other product, have to be competing if they're going to maintain sales and brand loyalty. The question is, with products that have potential harmful consequences to youth, what's the right balance here?" said Jeff Chester, of the Center for Digital Democracy. MR. Chester is a co-author of a 2010 report funded by the Robert Wood Johnson Foundation's Substance Abuse Policy Research Program that calls for more scrutiny of digital efforts, such as the Proximo campaign and others like it, by some of the industry's biggest players, including Anheuser-Busch, Diageo and others.
The government appears to be listening. The Federal Trade Commission said in a regulatory filing late last month that it plans to examine digital and social media -- including data collection -- in its next review of alcohol marketing and youth, which is expected to be published some time next year. "We believe it is time to launch a new major study to measure current compliance with the self-regulatory standards, to look into new developments in alcohol marketing and to determine what additional recommendations, if any, are warranted," Janet Evans, an FTC senior attorney, told Ad Age.
The commission's last report, published in 2008, gave a mostly positive review of the efforts by the industry, a self-regulated structure overseen by the three major trade groups for beer, spirits and wine. The FTC found that more than 92% of radio, TV and print ads met the standard of being placed in outlets where at least 70% of the audience is age 21 or older. (The FTC has been pushing to bump the standard up to 75%, a call that has so far been ignored by the industry.) The trade groups apply the same 70% standard to digital media, and alcohol companies routinely age-verify on branded sites. The Beer Institute -- which represents large brewers -- recently took the extra step of requiring age verification for digital media in which there is a dialogue between the brand and a user. For instance, beer brands on Twitter typically ask users to direct-message their birth dates before they can follow the brand. On Facebook, alcohol companies usually rely on birth dates users include in their profiles.
But advocates say the safeguards fall short. And they are lobbying for stronger rules just as beer and spirits brands plan more aggressive digital campaigns and spending.
For one, anyone can lie about his age -- and there's really no way to stop that online (although Facebook says it has some unspecified systems in place to verify ages). Secondly, critics say Facebook does not police its own policies, which require age verification for commercial pages that promote alcohol. "The policy essentially isn't enforced," said Sarah Mart, research and policy manager for the Marin Institute, which has long taken a strict stance on alcohol marketing. In a 2009 report, the institute examined top-selling beer and spirits brands and found that 50% of Facebook pages could be viewed regardless of age. (The institute says it tried to isolate commercial pages, but it's possible citizen pages were included in their study. Anyone can create a page that talks about alcohol brands, but the institute says that even those should be banned from the site, as well as all alcohol ads.)
Facebook takes "the issue of underage drinking seriously," said spokeswoman Annie Ta. "We require that all alcohol-related advertisements use our tools and demographic targeting options to restrict the ad to users who are over the legal drinking age" and "we strictly enforce this policy through proactive investigations and response to user reports. We also require developers to restrict access to alcohol-focused applications, and respond to all reports of breaches in this policy."
Google-owned YouTube prohibits ads that "target minors either explicitly or by including endorsements from athletes, cartoon characters, icons/people appealing to minors." The video site does not require age verification for alcohol-branded content. For instance, anyone is free to view a channel by Pernod Ricard-owned Absolut Vodka that includes a short film promoting Absolut Citron and a behind-the-scenes look at the Spike Lee-inspired Absolut Brooklyn limited-edition vodka.
Twitter recently began offering its "promoted tweet" and other advertising to a wider set of brands, but so far no alcohol companies have signed up, said spokesman Matt Graves. And if they do? "We're working through the policy issues internally, but don't have anything to share" at the moment, Mr. Graves said.
To be sure, compared with other categories, alcohol brands have moved more slowly to digital and social media, due in part to the regulatory hurdles. "It's still the great unknown as far as alcohol marketing is concerned, because nobody's proven you can build a brand online," said one senior beer-marketing executive. The FTC noted in its 2008 report that internet ads and promotions represented less than 2% of industry marketing expenditures, compared with 26% for TV and 19% for point-of-sale.
But brands are starting to get more aggressive. For instance, Beam Global Spirits & Wine plans to spend up to 35% of its media budget on digital, up from 6% just two years ago, said Andrea Javor, senior manager for digital and media.
Beam has been using Facebook for years, but recently took the extra step of creating Twitter feeds for some brands -- including Beam and Maker's -- after it learned that more than 75% of Twitter's audience, as measured by ComScore, are of legal drinking age, Ms. Javor said. (Beam adheres to a 75% threshold, instead of the standard 70%.)
Beam also runs a Maker's Mark "ambassador" program, in which age-verified fans sign up to get email newsletters on the brand. Does Beam worry than some fans could lie about their age? "I'm not sure there is a way to stop that," Ms. Javor said. "You have to trust the integrity of consumers at some level," she said, adding that "we are absolutely doing the best we can with the technology we have in place."
Heineken USA plans to start using Twitter for many of its brands. "Today's digital media has many platforms that allow for a two-way dialogue with consumers," said Julie Kinch, the beer importer's general counsel. "From a marketing perspective, this is transformational, but HUSA believes that with this opportunity comes the responsibility to confirm that these communications are only with legal-drinking-age consumers."