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On-Demand Delivery Aggregators Expand Their Alcohol Businesses

Delivery Aggregators Expand Their Alcohol Businesses

As delivery aggregators look to become go-to destinations for a wider range of on-demand needs, key players are expanding their alcoholic beverage options.

Take, for instance, DoorDash. Earlier this month, the company announced the launch of alcoholic beverage delivery in Maryland, following changes to the law in the state that made doing so possible.

“We’re thrilled to be bringing alcohol delivery to Maryland, providing even more consumers with a convenient, responsible way to enjoy their favorite drinks at home,” Erik Ragotte, the aggregator’s general manager of alcohol and convenience, said in a statement. “Whether it’s locally brewed craft beers or bottles of beloved wines, we hope that this new offering can showcase the best that Maryland has to offer.”

The news came days after Target-owned retail aggregator Shipt announced a partnership with The Save Mart Companies to deliver from more than 170 Save Mart, Lucky California and FoodMaxx stores, including alcoholic beverage delivery from “nearly all” participating locations.

“Our partnership with their three beloved brands offers shoppers convenient, same-day delivery of fresh, value-driven products,” Shipt Chief Growth Officer Katie Stratton said in a statement. “Together, we look forward to the continued expansion of our West Coast footprint.”

In the spring, Uber Eats expanded its partnership with Rite Aid to include alcohol delivery in eight states from nearly 1,000 of the pharmacy retailer’s stores across California, Idaho, Michigan, New York, Ohio, Oregon, Virginia and Washington. At the start of the year, Uber shut down its alcohol-specific delivery marketplace, Drizly, focusing on the selection of its core Uber Eats marketplace.

Expanding alcohol delivery services is not without its challenges. The industry is heavily regulated, with laws varying by state and even by municipality. Aggregators must navigate a complex web of regulations concerning the sale and delivery of alcoholic beverages. This includes obtaining the necessary licenses, adhering to age verification requirements, and complying with restrictions on delivery hours and locations.

Overall, consumers are getting more of their foods and beverages digitally. The 2024 edition of PYMNTS Intelligence’s “How the World Does Digital” report drew on responses from 67,000 consumers across 11 countries that make up approximately half of the world’s gross domestic product, examining their digital behaviors across various parts of their lives. The findings showed that 44% of consumers engage with aggregators at least once a month, and 1 in 4 do so at least weekly. Plus, 40% of consumers go online grocery shopping monthly and 20% do so weekly.

The convenience factor is a key driver behind the expansion of alcohol delivery services. This trend was accelerated by the COVID-19 pandemic, which saw an uptick in online alcohol sales as lockdowns and social distancing measures kept people at home. A PYMNTS Intelligence 2021 survey of nearly 2,000 consumers found that nearly half of consumers who bought alcohol online for same-day delivery were doing so more often than pre-pandemic.

The expansion of alcohol delivery services by aggregators is poised to continue as consumer demand for convenience and variety remains strong. As technology advances and regulatory environments evolve, the potential for growth in this sector is substantial. Aggregators that can successfully navigate the complexities of this market and deliver a seamless, reliable service will be well-positioned to capture a share of the lucrative alcohol retail market.

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