The Who-What-Why of Drizly

Selling wine beyond the walls of your store.

It may have been part of your value proposition from the start, or it may have been a revenue source that your store has developed in more recent years. That’s due in part to the growing capabilities of ecommerce, and it’s due in part – most relevantly for this post – with the booming popularity that we’re currently seeing of alcohol e-commerce platforms, including Drizly, Instacart, and others.

In each case, reaching consumers beyond the footprint of brick-and-mortar stores has become a priority and a significant portion of some retailers’ bottom line.

It makes sense. The technology is available and poised to deliver (literally). The demand, too, is tangible and pronounced, as services like Drizly combine a hit list of consumer trends. The ease of ordering online, for example. The get-it-now demands of immediacy from the hip, urban millennial crowd. The ability to easily access a wide selection of products.  And the within-reach potential of beer, wine and/or spirits, day or night, delivered straight to their door.

It’s a powerful combination of forces. But how does it actually work? And what are the benefits to the retailer of partnering with these types of platforms?

In this article, we tease out the nuts and bolts of the service, how they use data to execute orders and track efficiencies, and what that means for retailers’ efforts to sell more wine.

Here’s the who-what-where-when-how, and most importantly the why, retailers can get the most out of a partnership with Drizly or Instacart

WHO

Every retailer who’s looking to expand their reach beyond just the sidewalk or shopping center where the retailer is located. Access to a larger consumer base leads to a majority of retail partners seeing incremental sales and revenue increases with limited cannibalization of in-store visits. The retailer is not obliged to work exclusively with any one platform; promoting their partnerships, though it is not an obligation, benefits the retailer in terms of publicity and sales.

WHAT

Yes, every retailer can create their own website and ecommerce offering. It’s just that the offering is boosted significantly by outsourcing the technology infrastructure and the advertising that drives traffic to the platform.

WHERE

According to John Temple, Drizly’s Senior Manager of Strategic Insights, partnering with Drizly gives the retailer access to wine consumers in a broader area.. That access can happen in a number of ways and is dependent on what the consumer wants – click-and-collect, for example, fast delivery, or intrastate shipping.

WHEN

While a store is closed on evenings, weekends and holidays, an e-commerce platform still allows consumers to place orders for next-day delivery or shipping.  This expands a retailer’s consumer reach, offering the ability to buy any time, day or night.

HOW

These platforms can help retailers identify products they may not be carrying, which eventually leads to capitalizing on potential sales they may otherwise have been missing out on.

Temple said that Drizly also “helps to surface information about pricing levels and changes, in order to empower the wine store to stock and price accordingly.” Retailers whose value proposition is EDLP generally fare well on Drizly, he added. The typical Drizly consumer cares about a few things, including price, convenience, and performance of the retailer, that is, that they actually deliver the products that were ordered, and on time.

HOW MUCH IT COSTS

Retailers pay a monthly subscription fee for access to an e-commerce platform’s consumer base and technology. The amount of the subscription fee depends on a number of factors and is determined on a case-by-case basis. The consumer enters their credit card information on the e-commerce platform website or app, and the payment is received by the retailer.

WHY

This one is pretty simple. Selling more wine, beer, and spirits beyond the walls of your store means selling more wine, beer and spirits. Period.

BONUS: DATA AGGREGATION ACROSS LIQUOR STORES

Drizly CEO Nick Rellas said that his team created Drizly “to be the best way for consumers to buy beer, wine, and spirits. To do so, we’ve relentlessly analyzed our own data every day to understand the needs of our customers, the trends they’re driving, and where the industry is headed. It’s time we share that knowledge with the industry.”

This data is available publicly via the Drizly Data Distillery. The most recent update highlights the continued slow-down of liquor and beer sales and strong double-digit growth for wine. In liquor, tequila is up, rum is down. In wine, rosé is (still) up, while Champagne is down. In beer, ales and ciders are up, driven largely the sales of IPA.  Previous data snapshots have highlighted topics like flavored vodkas, boxed rosé, craft beer, and the spending habits of corporate consumers.