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Online Alcohol Providers See Major Boost Amid Coronavirus Sheltering

March 19, 2020

As COVID-19 continues to force Americans to stay at home, online purchases of beverage alcohol are seeing major increases. E-commerce retailer Wine.com reports surging demand over the past week as people continue stocking up on wines and spirits by using home delivery. “Demand has doubled in the last week compared to the same period last year, and has tripled over the last several days,” said Wine.com CEO Rich Bergsund, adding that growth is coming from both existing and new customers.

Bergsund said Wine.com shoppers are buying a higher number of bottles per order, but spending slightly less per bottle—$26 versus the normal $32. He added that the company’s warehouses remain open and that it continues to ship, with inventories at healthy levels and no issues regarding supply. Wine.com, founded in 1998, last year saw annual revenues rise by $20 million to hit the $150-million mark.

Online local delivery platforms are also seeing sharp increases. At delivery provider Drizly, sales for the seven-day period through Sunday, March 15, were double the levels seen previously in 2020 before the crisis broke, and the average customer spend was about 30% higher than normal, the company said. Since then, its general merchandise value has been up 500% from the year-earlier period, with order value 50% higher on average. Drizly operates across 180 U.S. markets, and at press time most of its retail partners’ stores remained open. The company, which launched in 2012, is minority-owned by the Wine & Spirits Wholesalers of America (WSWA).

Orders at online delivery platform Minibar have also been spiking. CEO Lindsey Andrews told SND that orders have been surging since last Wednesday, with average order values up 22%. “Last Wednesday was 27% higher than in the previous week, and Thursday was 80% higher,” Andrews said. Traffic eased up on Friday and Saturday, but the spike resumed on Sunday with a 57% rise. This week’s sales have gone into overdrive, with Monday’s orders up 131% from a week earlier and Tuesday’s up 115%. Minibar’s average order value has been $88, compared to a normal level of $72. “Sales are coming primarily from existing users who are stocking up,” Andrews added, noting that orders are also being placed earlier in the day than usual. Wine sales in recent days have comprised 56% of Minibar’s orders, up from a 49% average, while the spirits share is up slightly to 34% and beer comprises the remainder. Minibar partners with beverage alcohol retailers in 16 states across the country, as well as Washington, D.C.

“The increase in online purchases in the past two weeks has been unprecedented,” said Devaraj Southworth, CEO and co-founder of Thirstie, the New York-based e-commerce platform that works with hundreds of retailers around the country. “Our retail partners are telling us that, for the first time ever, a majority of their sales are coming from online purchases.” The average order size has nearly tripled, Southworth added, as people are concerned about supply meeting demand. “The current situation has highlighted the growing role e-commerce plays,” he said. “We’re seeing all brand categories pivot hard into the e-commerce space.”—David Fleming and Terri Allan

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