Best clubs bar none
Chris Anderson, editor-in-chief of Wired magazine, predicted in 2006 that the future of consumption would be one of 'freemium' - while most basic services would be free, we would be paying for a value-added alternative. Anderson was talking about the Web and media businesses, but the premise also applies to Hong Kong's bar scene.
In the same year, M1NT was established on Hollywood Road. It made a name for itself as one of Hong Kong's most desirable nightclubs. Basic membership was about HK$4,800, but member-shareholders - by invitation only - paid from HK$50,000 to HK$500,000. Crowds of non-members would wait outside the door in the hope of entry.
Four years later, the venue has become home to Republik. Like most bars there are no barriers to entry, but Republik still has a membership scheme. But instead of paying for the right to enter, punters pay to get a better deal.
Members of Republik pay HK$7,500 per year for a privilege card and, in return, they are offered 15 per cent off the bar price, a bottle of champagne upon signing up and another on their birthday. Crucially, though, that is not a fee pocketed by the club - it is bar credit. The HK$7,500 is entirely consumable.
'Traditionally, people would pay for membership because there was intrinsic value in membership itself,' explains Nick Willshire, founder of Hush, one of Central's newest bars, which also employs a 'freemium' system of membership. Members could get into their favourite club easily, he says, and could feel like they were a part of the venue. As a former Morgan Stanley employee who had memberships to clubs in Central because of the position he held, Willshire explains the intrinsic value that memberships carry. 'There's an added self-esteem boost of being part of an exclusive, or invitation-only, members' club. And a lot of times, guys use the fact that they have memberships to make themselves more attractive to girls.'
Andrew Lewis, director of Republik and co-founder of the venue's previous incarnation, M1NT, says this kind of membership served a crucial purpose at the time. Being a traditional members' bar allows the venue to portray itself as exclusive, and to attract high-net-worth individuals. Such clientele aren't interested in sharing a bar with '18-year-old kids drinking buckets of beer', he says.
While this is great for members who seek privacy, the set-up causes problems for the venue owners. Friday and Saturday nights see the places packed with members and their friends, but for five days a week owners find their clubs below capacity. 'In my view it doesn't work in Hong Kong, to be exclusive if you've just got a [nightclub],' Lewis says. 'M1NT was exclusive. At the start, if you weren't a member you couldn't get in and in the first couple of years that rule was adhered to, but towards the end it tapered off. Given the product that I have and others in Hong Kong have, to be sustainable you can be selective, but you don't need a membership scheme.'
Lewis says he wants Republik to be a local for people in Hong Kong, and for this there needs to be an open-door policy. 'People who come here shouldn't be turned away because they don't have membership: the people that come here are the movers and shakers of the city; they should be welcomed,' he says. 'If they come back again and again they can have a privilege card, to enjoy priority access to table bookings on party nights and free entry when we have guest DJs.'
The reward for membership, then, has shifted from simply giving customers rights - such as the ability to enter - to giving them privileges. 'People want benefits with their membership,' Willshire says. 'They're asking, 'What do I get for my money?''
Hush charges HK$5,000 - also consumable - and this offers a 20 per cent discount on drinks and priority access on event nights. On a typical day anyone can come to the bar and won't be charged for entry, but people are paying for premium privileges. A third new bar in Central with the same attitude is Hyde, which asks for a consumable HK$18,000 per year.
Some are sceptical of the value of this new form of membership, however. One private equity analyst suggests that for it to work there still need to be tangible advantages to becoming a member. 'This is a win-win situation for clubs and customers, but people in financial cities like Hong Kong can be pretty shallow,' he says. 'If anyone can come into a bar then that's great, but clubs should still offer a members' area, to solve any reservations people might have about handing over their cash.'
A members' area could certainly make membership more attractive, but the new bars appear reluctant to go any further in terms of exclusivity. There is not a shortage of quality bars in Central and proprietors are discovering that turning non-members away does not encourage people to bite the bullet and sign up to a club. Meanwhile, the venues are still paying rent and if there are only enough members in town to fill the club on weekends then they have a problem. So as well as eschewing a rigid membership scheme, there has been a rethink of how clubs use space. Republik, Hush and Hyde each employ multiple uses for their venues.
Joshua So, head of operations at Hyde, explains that with 12,000 square feet to fill, a members-only club is unworkable.
'Monday to Thursday we don't insist that people are members to come in,' he says. 'We're open from midday serving three-course lunches for HK$98 and allow people to come in for free pool.' And when night comes, Hyde, split over two floors, has two different vibes.
'The third floor is an all-day lounge, and we have balconies for people to relax on,' So says. 'Come Friday night, some might want to go downstairs to party, but a lot of the customers have been there, done that. They're looking to hang out over cocktails, not magnums of vodka, but they can do either here.'
Republik has turned its ground floor - previously used to house an intimidating reception desk - into an open-fronted lounge. Open from 5pm, with a distinctly living room feel, food is available - something M1NT never offered. This allows Republik, like Hyde, to do as much for a sophisticated evening clientele as it can for a livelier party crowd.
Hush boasts a beautiful outdoor area and is also open from 5pm to cater to the early evening market. 'People are becoming less and less concerned about the elitism of bars and clubs now that competition is getting more intense,' says another financial sector worker. 'Bars and clubs are fighting for customers by being less exclusive.'
'Partly, we have membership as a way to be selective on busy nights because we want to curate the atmosphere inside,' So says. 'But I'd rather my club be busy and happy than empty and exclusive.'