Bars and restaurants have been among the businesses most affected by the pandemic. That has given an opening to alcohol delivery services like Drizly, which is following the lead of direct-to-consumer (D2C) retailers and meeting customers where they live—literally. We recently spoke with Scott Braun, CMO of Drizly, about trends in consumer spending behavior and ecommerce sales of alcoholic beverages during the coronavirus pandemic.
Are you seeing consumers purchasing different products than they had in the past, or even immediately pre-pandemic?
Tequila had always been at the forefront of growth on Drizly, but it’s really surging now. People like their margaritas, and tequila’s an ingredient that you need. So, tequila is leading the charge.
eMarketer forecasts show that food and beverage ecommerce sales in the US will grow by more than 58% in 2020, more than any other CPG category. Does that forecast align with what you’re seeing?
I look at places like DoorDash and Instacart and know their sales are up dramatically. If I were to focus on alcohol specifically, the numbers for the total category are up around 200% to 250%, and we’re up about 350% and not seeing any signs of that slowing. So, at least from an alcohol-specific standpoint, we think we’re going to outstrip that 58% by a really long shot.
Let’s think optimistically to a time when bars reopen and people are able to go back to whatever normal used to be. Do you see consumers still wanting to purchase alcohol online, even when they have the ability to go out and be social again?
Online isn’t just about convenience. There’s also a measure of consumer control. When somebody shops on Drizly, they’re seeing several thousand SKUs, which is more than any single liquor store actually has. People can say, “I actually want to see one item across four different stores.” And they can compare shipping times, prices, store ratings, and more. Consumers get a taste of that control on top of the convenience, and they really are attracted to it. That’s what helps shift the behavior long-term.
Which advertising channels have worked best for Drizly during the pandemic?
We’ve seen better efficiency in most of our channels since COVID-19 started. A couple of years ago, the vast majority of our spend would have been in paid search, really at the bottom of the funnel. We are looking now to acquire new customers and, at the same time, have a real branded impression where we can tell part of our story. And the world’s changed so much that I don’t need to buy TV media the way I bought TV media two, five, or 10 years ago. Now we’re veering into connected TV.
The holiday season is always a busy time for the alcohol business. What are your expectations for holiday sales?
If holiday parties are going to be a thing, then clearly, we’re going to ride that wave in a big way. We think of our brand as making good times better, and being able to help somebody with a holiday party is certainly a way we can make that good time better. If holiday parties won’t be a thing, we may end up seeing gifting go through the roof. We’ve seen areal acceleration in gifting already, whether it’s a company sending out gifts to people, or friends who can’t celebrate a birthday in-person but would like to send a present.
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