Saturday, September 17, 2011

Kalamzaoo Beer Exchange

If you ask people for stories about the first time they tasted beer, most will tell you it was awful—that quaffing fermented barley for pleasure was something they had to work at. Not me. I had my first beer in the gloaming confusion of a neighborhood summer block party when I was about 10 years old and liked it immediately. Perhaps it's because I've always been drawn to bitter flavors, that poor stepchild of our taste palette (where sweet, salty, and sour tend to get more love).

I'm visiting Kalamazoo MI this weekend, offering a series of process workshops to student cooperative groups in conjunction with Western Michigan University and the Kalamazoo Peace Center. Last night, after my afternoon workshop, I went for a stroll downtown in broody 50-degree weather that announced the arrival of fall more surely than the calendar. After strolling up and down the pedestrian mall on Burdick, I wound up stumbling across the Kalamazoo Beer Exchange. What a hoot!

As you'd anticipate from their location in a college town (as well as from the first two words in the name), they have a lot of malt beverages on tap. In fact, they have 28 of them, covering a delicious range of all that's exciting in American microbrewing today, plus a smattering from other countries. While that alone would be sufficient for me to happily while away my evening, there's more. Coincident with my burgeoning interest in cooperative economics, the prices for draught beer at this place actually fluctuate based on real-time purchase patterns among patrons. You have to pay attention.

Here's how it works. The evening is partitioned into a series 15-minute "trading periods" during which all the networked cash registers in the two-story bar are feeding sales data into a central computer. Based on how well each of the 28 varieties are selling that period, the price for each beer may go up, down, or remain unchanged. There is a "big board" in every room that lists the current price of a glass of each beer. A clock in the upper right corner ticks down the time remaining in that trading period. Once the period ends, prices are adjusted, and then remain fixed for the next 15 minutes. Prices are posted in red if they dropped most recently, in green if they've risen, and in white if unchanged. Along the bottom of the screen is a ticker tape display moving from right to left, offering details about how much each beer's price has altered since the last adjustment.

While the algorithm is secret, the concept is simple. If a particular beer sells a lot during the prior trading period, it's price will rise for the next trading period; if sales are slow, the price drops. What an inspiring way to teach the principles of supply and demand—you can actually feel it in your belly! All changes are made in increments of 25 cents. While most beers are sold in the traditional pint, a few of the more exotic offerings came in a 12-oz tulip glass. Over the course of the three hours that I held down my bar stool (yes, I witnessed 12 trading periods), I saw prices as high as $6.50 and as low as $1.75 (for Bud Light & Miller Lite). As an aside, it's amazing to me that they allow that swill on the same page as Huma-Lupa-Licious, the bestselling IPA from Short's, a microbrewery in Bellaire, MI, which describes this beer as "a complex malt and hop theme park in your mouth." (How can one resist? I didn't.)

Occasionally (about once an hour) there is a "market crash," where all beers are suddenly offered at historic low prices for five minutes, producing a veritable
feeding drinking frenzy. However, because you are only allowed to buy two beers at a time (no cornering the market), you can only get so crazy. As I drank it all in, so to speak, I tried to figure out whether this concept encourages beer consumption, and I think it does. While you're probably paying less per beer (at least that's true if you're a savvy customer and able to discipline yourself to buying low while getting high), the novelty of it all resulted in my staying longer and ultimately drinking more.

While it's a clever gimmick and I admire their marketing ingenuity, neither do I begrudge the Kalamazoo Beer Exchange their shekels. For, at the end of the day, I am an adherent to the motto from the brewery in Bellaire
, "Life is Short's, drink it while you're here."

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