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Beverage NewsChannel StrategiesBeerWine & Spirits

Drizly study suggests bullish outlook for holiday sales

Continued growth expected for Mexican spirits

Drizly Logo
December 4, 2020

Boston-based Drizly released its second annual monitor of North America’s independent alcohol store owners and managers, providing an in-depth look at the experience and expectations of beverage alcohol retailers operating in a COVID-19 environment.

The study found nearly half of retailers predicting significantly higher sales this holiday season, 78 percent of respondents reporting higher online sales since March, and Mezcal leapfrogging the likes of Irish and Japanese whiskies in expectations for growth next year. 

The study comes at a transformational time for alcohol retail, eCommerce, delivery and Drizly itself. Sales on its platform, which connects adult beverage shoppers to local retailers for purchase and delivery in under 60 minutes, have sustained 350 percent growth compared with last year. Meanwhile, the number of retailers on Drizly has increased from just more than 2,000 to more than 4,000 locations since January.

The following are key findings:

  • Higher sales have sustained, and online ordering is outpacing in-store shopping. Seventy percent of independent retailers surveyed experienced higher in-store sales since COVID-19 became widespread, while 78 percent saw online sales increase. Furthermore while nearly half of retailers reported that online sales accounted for less than 5 percent of their total sales prior to COVID-19, 56 percent said that online sales had grown to 11 percent or more of total sales post-COVID-19 – with a substantial share reporting that online sales now comprise 30 percent or more of total sales.
  • An upbeat outlook for the holidays. Positive sales trends are expected to hold up through the holiday shopping season. Sixty-three percent of respondents expect sales to at least match a typical Q4s, and 44 percent predict that their sales will be significantly higher than during comparable prior periods.
  • Grocery delivery threat gains momentum. Grocery delivery services were cited as independent alcohol retailers’ fastest-growing competitive concern, jumping nearly 30 percentage points since last year, and in absolute terms, surpassing online wine retailers.
  • Emerging craft segment might fuel hard seltzer’s growth. As White Claw and Truly solidify their category leadership, nearly a third of retailers are looking to fast-proliferating craft entries to keep the hard seltzer category thriving. Bringing ready-to-drink cocktails into the disruption discussion, expect early leader High Noon to maintain its growth trajectory, with 51 percent of retailers planning to give it more room over the next year.
  • A bright outlook for Mexican spirits. Expect to see tequila and mezcal taking up more shelf space in 2021 and beyond. Tequila edged out 2019 champ bourbon to take first place in retailers’ inventory growth predictions for spirits. Meanwhile, mezcal placed behind only tequila, hard seltzer and RTD cocktails among emerging categories that retailers expect to stock more next year. The finding squares with sales on Drizly, where mezcal’s share growth has vaulted 57 percent ahead of last year.

 “It goes without saying that 2020 was an unprecedented year. We feel fortunate to have played a role in helping our Retail Partners continue to serve consumers during these times, and in many cases, actually grow their businesses,” said Cory Rellas, Drizly Group chief executive officer and Drizly co-founder, in a statement. “These retailers have a front row seat to all the happenings in the beverage alcohol industry and have an invaluable pulse on its future. Their experiences this year and expectations for 2021 form the basis of this annual retailer report, and are a meaningful barometer for what’s to come.”

Drizly conducted an in-depth study of more than 500 adults who manage or own independent liquor stores during October, including retailers both on and off the Drizly platform.

KEYWORDS: Drizly eCommerce mezcal online beverage sales

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