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Even before the pandemic changed essentially everything, alcohol commerce was evolving. Strict quarantine regulations changed our buying habits seemingly overnight. Having a casual drink at restaurants or bars wasn’t an option so we shifted those budgets to retail. As the pandemic took hold in March 2020, sites like wine.com saw dramatic sales increases.
Nationwide, major retail stores pivoted to curbside pickup and home delivery. Any company that wasn’t in this market scrambled to make their entrance into it. Since the space was rapidly shifting, alcohol regulations had to change.
Many of these alcohol delivery services actually launched several years ago as a way to keep the party going when you ran out of merlot. Now, they’re expanding worldwide in an unprecedented way.
The Current Landscape of Alcohol Delivery
Drizly had quickly set itself apart from the crowd. The company recently raised an impressive $50 million in a Series C funding round. Its main draw is its one-hour delivery guarantee for orders made through the platform, as well as its broad nationwide coverage. Drizly has seen strong growth during the COVID era, with a staggering twelve-fold year-over-year growth in April 2020, when most states were under shelter-in-place orders. Moreover, the company has seen business more than triple since 2019. “We’ve had an increase in sales of 350% year to date—it definitely has been a sharp increase,” says Jaci Flug, general counsel at Drizly.
Soon enough, by February ‘21, Drizly announced that they had reached a deal with Uber to acquire the company for approximately $1.1 billion (with a B) in stock and cash.
Besides Drizly, other DTC companies have seen impressive growth. Winc, a popular DTC wine club, saw a whopping 578% increase in new member sign ups during mid March 2020. Sales during the same period increased by 49.6%. Since the beginning of the pandemic, Winc has added new members at an average rate of 2,102 a day versus the previous average rate of 207 new members a day. This draws attention to the fact that the explosion of alcohol delivery has also lent itself to the creation of thousands of jobs.
In fact, in response to the rising demand for home delivery during the Covid-19 crisis, Drizly increased its workforce by 62%, from 136 employees on March 9 to about 220 employees to date, including jobs in marketing, sales and account management, product engineering, and information technology.
Vivino, another popular wine app, saw its highest sales total on March 13, 2020, effortlessly squashing its previous Black Friday totals. A week later, on March 21, its sales jumped even more, by 162%. Vivino’s sales in Italy saw an even larger spike, up 282%. Vinopro, another online vendor, has seen its sales soar 50% since the start of the pandemic.
But, while alcohol delivery companies continue to exist and expand, it hasn’t always been so simple to reach consumers. Recently, an influx of states, like Georgia, Pennsylvania, Arkansas, and Oklahoma, have expanded their beverage alcohol delivery laws to allow for home delivery services. In all, 25 states now permit the delivery of wine, spirits, and beer, and another eight states permit wine and beer deliveries.
Alcohol Delivery Limitations
When the pandemic began to switch things up, alcohol commerce and delivery were in a strange place. For example, originally, most states only allowed off-premises alcohol sales with the purchase of food. Of course, this regulation was put in place both for revenue and safety reasons.
Once states like California began to be more lenient with regulations, most states followed. But states like Pennsylvania, where liquor laws have always been strict and pretty odd, had a slightly different journey in normalizing alcohol delivery.
Pennsylvania’s alcohol laws, interestingly enough, are very prohibition-oriented. At the end of National Prohibition in 1933, the governor at that time was a committed teetotaler. In other words, he strongly opposed repeal. So he called a special session of the General Assembly, thus forming the locally detested Pennsylvania Liquor Control Board.
The purpose of the Board was simple. It was to discourage drinking alcohol “by making it as inconvenient and expensive as possible.” (Pennsylvania residents, up until the pandemic, are nodding in agreement.)
Pennsylvania alcohol laws still reflect that purpose. The state has a government monopoly on the sale of distilled spirits. That’s whiskey, rum, tequila, gin, vodka, Scotch, rye, and the like.
Pennsylvania’s government monopoly stores can sell from 9 a.m. to 10 p.m. Monday through Saturday. On Sunday, they can operate from 11 a.m. to 7 p.m. Monopoly stores sell spirits and wine but not beer. Only beverage distributors may sell beer in larger quantities, like kegs. But they can’t sell spirits at all. You also can’t sell liquor on Sundays without special permission.
Restaurants, bars, and other retailers with licenses may sell beer and wine in smaller quantities. They may not sell more than 192 fluid ounces of beer per purchase. Nor may they sell more than four bottles of wine per purchase.
That being said, Pennsylvania and states like it had many hurdles to leap when it came to alcohol delivery.
Currently, as far as delivery goes, Pennsylvania has made progress for a place with such strict regulations. Consumers can have beer and wine delivered from apps like GoPuff, but you still have to get the hard stuff from a mandated liquor seller. So unfortunately, alcohol delivery still is a bit complicated in states like PA.
As of now, there are still some states that make alcohol delivery difficult, if allowed at all:.
The states that absolutely do not allow alcohol delivery with no exceptions are Alabama, Utah, Kentucky, and Mississippi. Delaware and Rhode Island do not allow for alcohol to be delivered, with some exceptions that make delivery possible. Let’s get into the details:
Alabama: There are no exceptions in the state of Alabama. The delivery of alcohol from any source is strictly prohibited. In certain cases, residents can make a special request for an order, but the request must be reviewed by the Alabama Alcohol Beverage Control Board.
Mississippi: There are no special cases or exceptions of any kind when it comes to the delivery of alcohol in Mississippi. Delivery is absolutely not allowed, period.
Kentucky: Some of the strictest laws regarding alcohol delivery are in Kentucky. There are many counties that are completely dry, meaning there can be no alcohol sold at all. Deliveries are prohibited both out of state and in the state.
Utah: Absolutely no exceptions; delivery of alcohol is illegal.
Kentucky: Kentucky is home of some of the most strict laws. There are many counties that are completely dry, meaning there can be no alcohol sold at all. Deliveries are prohibited both out of state and in the state.
Delaware: Here, you can’t deliver any booze, with only one exception. If you purchase alcohol from a store or restaurant, they can ship it right to your place. It can only be sent to the person who is buying the alcohol and you have to be a legitimate DE resident.
Rhode Island: The rules for alcohol delivery are similar to those of Delaware. If you are a Rhode Island resident, you can purchase prepackaged alcohol from craft-alcohol businesses. These businesses are allowed to ship your purchase to your house.
Clearly, though alcohol delivery is in a good place, there’s some work to be done. But, along with law revisions, there are many innovations that have come from the shift in consumer alcohol consumption.
Alcohol Industry Innovations
The Sober Movement
While the boredom and stress of the pandemic skyrocketed alcohol consumption, it ended up having an adverse effect on the alcohol industry as well– the sober movement. We were inundated every day with alcohol related news; whether it was the introduction of alcohol delivery, restaurant cocktail carryout, and much more, consumers who didn’t drink alcohol were left in the dark.
The New York Times points out that pandemic drinking, and the move to sobriety or temperance for many people has been discussed heavily, almost in tandem with the rise of fancy craft beverages. In response, almost as if on cue, over the past year, at least five so-called dry stores have opened in New York, offering alcohol-free wines, craft beers and bottled drinks made with herbs, fruits and spices.
This may sound like a millennial fever dream, but it’s actually rapidly increasing in popularity.
Non-Alcoholic Drinks Gain Popularity
One report projected that the nonalcoholic drink market, like soft drinks, teas, and water, will reach $1.6 trillion worldwide by 2025. Another study analyzed American consumer demand on Amazon for nonalcoholic beverages and found a 60 percent increase from January through July this year compared with the same period in 2020. During the time frame, the demand for nonalcoholic beer increased by 85 percent.
Additionally, according to data gathered by Tastewise (a food and beverage data analysis group) and shared with Yahoo Finance, web searches for non-alcoholic beverages are up 47% from the same period last year after hitting an all-time low in April 2020. Tastewise also reported that restaurant and bar mentions of non-alcoholic beverages are up 52% from last year. And in August, Fact.MR published a study that said by 2031 non-alcoholic wines could be a $4.5 billion industry globally.
Reynald Vito Grattagliano , the founder of Arkay non-alcoholic beverages, a line that includes alcohol-free vodka, gin, tequila, and bourbon, pointed out that the booze-free industry was so small in 2016, there were very few dry options on the market, if any at all. Now, it’s almost as ubiquitous as regular ‘ol booze, and is just as easily accessible to have delivered. If not more easily accessible, because there was never a prohibition against cute soda-based cocktails.
All of this culminates in the news that food delivery giant DoorDash has officially launched a booze option on their app. When these guys get involved you know it’s a juicy sector.
Alcohol will be available through the DoorDash app in 20 states, the District of Columbia, Canada and Australia, reaching over 100 million customers worldwide. That’s a lot of customers…especially considering a lot of the population can’t even consume alcohol yet.
Customers of drinking age can toggle the alcohol tab on the DoorDash app to order beer, wine and spirits from a selection of restaurants, grocery stores, convenience stores and local retailers. The company said it will check the buyer’s ID in the app and during delivery.
Alcohol delivery becoming just as ubiquitous as food delivery is a concept that is still difficult for many to grasp. The forced accessibility measures that companies had to take during the unprecedented pandemic ushered in a brand new society: A society that can get spicy margs delivered directly to our doors. We may not have flying cars, or that computer closet that Cher from Clueless had, but we can get wine, liquor, and beer delivered to us in an instant. Projections point to no signs of slowing down for the industry, and there is surely more to come in the future for alcohol commerce.