Championed as an industry pioneer in the alcohol ecommerce sector with impressive growth rates – and very much in the right place at the right time over the pandemic years – Drizly will cease all operations at the end of March 2024.
Parent company Uber will instead concentrate on Uber Eats as a 'one-stop shop' app.
“After three years of Drizly operating independently within the Uber family, we’ve decided to close the business and focus on our core Uber Eats strategy of helping consumers get almost anything - from food to groceries to alcohol - all on a single app,” Pierre Dimitri Gore-Coty, SVP of Delivery, Uber.
“We’re grateful to the Drizly team for their many contributions to the growth of the BevAlc delivery category as the original industry pioneer.”
Boston-based Drizly was founded in 2012: with three friends spotting an opportunity for an alcohol delivery service.
Pandemic demand for alcohol e-commerce
- In 2020, Drizly grew more than 350% compared to the previous year and doubled the number of retail partners on its platform
In 2021, Uber Eats snapped up the brand for $1.1bn. At this point, Drizly became a wholly owned subsidiary of Uber: with Drizly’s marketplace featured within the Uber Eats app, while also maintaining a separate Drizly app and web experience.
Now the largest online marketplace for alcohol in North America, Drizly partners with thousands of retailers in more than 1,400 cities: with drinks available to more than 100 million customers in the US and Canada.
The platform offers a ‘rich e-commerce shopping experience with personalized content, competitive and transparent pricing, and an unrivalled selection’. And with a young, often Gen-Z to millennial consumer base, the platform has been perfectly placed to track - and cater for - emerging trends.
It works in a similar way to food delivering platforms: users can browse products, pick their drinks and choose with stores they want to get them from. The order is then placed and the store carried out the delivery straight to the door in under 60 minutes.
One of the successes of the platform has been that is designed to be compliant with the US' complicated three-tier alcohol sales system and local regulations.
So why has Uber decided to shut Drizly?
Uber has realised that there are many apps out in the marketplace: and says consumers are increasingly preferring the ‘one-stop convenience’ of being able to get multiple of products on one app.
It wants that 'one-stop' to be Uber Eats.
In fact, the majority of Drizly consumers already have Uber accounts: so in shutting down Drizly, Uber knows it should be able to maintain most of the platform's customers with very little effort.
While Drizly has been a success story, it's still nowhere near the size of Uber Eats: Drizly's app has some 1 million downloads on Google Play, compared to Uber Eat's 100 million plus.
Uber Eats – once all about food – has seen the BevAlc delivery category on the app expand rapidly: with the global business more than doubling over the last year. It already has its own BevAlc offerings available across 35 US states and 25 countries around the world.
'An inspiring 12-year run with the highest of highs, our fair share of learnings, and countless memorable moments'
Drizly CEO Cathy Lewenberg - who joined the company in 2020 - said the company has helped changed the way the alcohol industry, brands and consumers interact.
"We powered tens of millions of deliveries and helped millions of customers savor life’s moments – engagements, housewarmings, new additions to the family (those of the fur kind included), and all the moments in between," she wrote in a post on LinkedIn this morning.
"We helped small & mid-size retailers grow and played a pivotal role during the pandemic in keeping people safe and in their homes.
While alcohol ecommerce growth has slowed after the heady boom of the pandemic, it should remain a 'key priority' for brands, according to analysis published last month by IWSR Drinks Market Analysis.
"We brought brands closer than ever before to highly engaged shoppers via Drizly Ads, allowing for true omnichannel experiences in an industry that has been historically nearly all brick & mortar.
"We partnered closely with regulators & policymakers alike to build tech designed to navigate a highly complex and regulated industry, safely.
"And we worked to drive greater equity in the industry via our Sip with Purpose program—supporting the growth of impressive brands owned by members of historically underrepresented communities.
"To our partners, we thank you for your collaboration. We wouldn’t be here without you. We know you’ll continue to thrive."