Splitit Navigating New Norms June 2024 Banner

Funds Pour in for D2C Wine as Millennials Seek Boozy Subscriptions

Funds Pour in for D2C Wine as Millennials Seek Subscriptions

With younger generations getting more of their day-to-day needs met via direct-to-consumer (D2C) subscriptions, investors are backing eCommerce wine platforms by the millions.

Most recently, brand acquisition firm Full Glass Wine Co., which focuses on the D2C wine category, announced that it raised $14 million in its Series A funding round and that it has acquired wine subscription service Bright Cellars.

“Bright Cellars’ strong reputation and loyal customer base are a perfect fit for Full Glass Wine Co.,” Full Glass Wine Co. Co-founder and CEO Louis Amoroso said in a statement. “Their innovative approach to personalization aligns tightly with our vision, and we are confident that together, we can create an even more engaging and rewarding experience for wine lovers everywhere.”

Personalization is key to beer, wine and spirits brands’ success on D2C platforms, data from the PYMNTS Intelligence study “Subscription Commerce Readiness Report: The Loyalty Factor” suggested. The survey of more than 2,000 U.S. consumers with retail product subscriptions found that consumers who hold alcoholic beverage subscriptions were more likely than those with any other type of subscription to seek out the option to personalize the products that are added to or removed from their subscription boxes.

Even more important to these subscribers, the study found, is the ability to make changes to the subscription frequency at any given moment without the need to unsubscribe first — to go from weekly to monthly, for instance, or vice versa.

Full Glass Wine Co. is not the only player expanding its presence in the eCommerce wine space. Last month, D2C beverage alcohol eCommerce solution provider Speakeasy Co. announced the launch of its Liquid Library marketplace for wine and spirits on top of its existing white-label solutions.

“I think this subscription is going to be … the way forward because for people — the millennials and Gen Z coming into the picture — there’s a massive rise in experimentational drinking,” Akshet Tewari, chief executive at consumer robotics and cocktail subscription company Barsys, told PYMNTS in an interview earlier this year. “… Subscriptions are … going to be a big part of the spirits industry, especially when it comes to in-home bar consumption. They will provide consumers with access to cocktails that they would have not been able to make before.”

Younger consumers do more of their shopping via subscription than older generations, according to the PYMNTS Intelligence study “The Replenish Economy: A Household Supply Deep Dive,” which drew from a survey of more than 2,000 U.S. consumers. The study found that 39% of millennial consumers reported using scheduled and auto-fill product subscriptions for most of or all their regularly used products in the prior six months, versus 31% of consumers overall. Gen Z also over-indexed in the category but to a lesser degree.

There is some pushback on the category from more traditional players. Last month, the Wine and Spirits Wholesalers of America issued a news release citing lawmaker and regulator concerns about lost taxes and minors’ access to alcoholic beverages.

As the landscape of consumer preferences evolves, the eCommerce wine industry is witnessing a surge in investment, propelled by investor interest and the rising adoption of D2C subscriptions among younger generations. The trajectory points toward a future where D2C subscriptions play a role in shaping the spirits industry’s in-home consumption landscape, despite regulatory concerns raised by traditional players.

For all PYMNTS retail coverage, subscribe to the daily Retail Newsletter.