Drizly is a two-sided market that connects end users (drinkers) and retailers (local liquor stores that deliver) through a website/app.
In this article, we will do a complete Drizly app review along with its business model, funding and more.
So, How Does Drizly Work And What Does It Do?
In simple terms, Drizly allows customers to shop for alcohol from their smartphones with the help of just an app. The two parties involved in Drizly are the customers and the business (liquor owners). The reason why Drizly is famous is because of the convenience it provides. The app works with more than 3000 liquor stores in New York, Miami, Los Angeles, Chicago, California, etc, and offers a wide range of drinks including beer, wine, whiskey, non-alcoholic beverages, mixers, and many more types of alcohol drinks.
In order to make the delivery actually possible, these steps are followed:
- The customer goes to the app and places an order for the beverage he wants to purchase and chooses a liquor store near him
- The order is then directed to the store which takes care of the delivery. The store makes sure that the order is fulfilled before an hour
- Customer is well informed during the entire delivery process and can easily track his/her order via the app
With Drizly, although the order reaches the customer within an hour in most cases, the company does not assure one-hour delivery. This is because the delivery is handled by the store and not the app. Additionally, conditions like traffic, poor signal, rain, etc can also affect the time.
Drizly acts as an intermediary between the sellers and buyers, and with the help of its technology and streamlined efforts; more and more customers have been added to the app. This is exactly what forces the stores to join the app. Because order delivery is fulfilled by the store itself, it would seem better for these sellers to just bypass the app and ask customers to order directly. However, Drizly has been able to provide top-notch functionalities and great incentives in order to make sure that this does not happen.
On one hand, Drizly asks the stores to pay a monthly membership and not per order fee which would mean not taking an order through Drizly will lead to no change. On the other hand, Drizly provides sellers with an app designed just for their drivers which has an ID verification feature in it. It also plays the role of an advertiser for the liquor store, providing them with a bigger audience.
Another reason why Drizly is preferred is because of the kind of quality checks it has before working with any liquor shop. It carries an extensive quality check on these stores and their inventory, storage space, distribution system, etc
Drizly Group, in 2020, closed a $50 million Series C funding round. The investment comes as Drizly, the leader in alcohol e-commerce and delivery, has grown over 350% in 2020 as compared to 2019 while achieving sustained profitability. The number of retail partners on Drizly’s platform has doubled since January 1, 2020. As consumers shift to online shopping for alcohol, Drizly expects 20 percent of off-premise alcohol purchases to be transacted online within the next five years, as compared to less than two percent in early 2020.
Drizly operates in 235 markets across North America through a network of 3,300 leading independent and chain retail partners.
Retailers that join Drizly experience incremental growth from new customers, with some retail partners generating over 30% of their sales through the Drizly platform.
Drizly’s Business Model
The business model of Drizly is pretty unique. The start-up neither sells nor delivers alcohol, which means that it does not have any products or a delivery fleet of its own. It simply directs all the orders to its partner stores, which then fulfill all deliveries using their own inventory and delivery personnel.
This is the reason why Drizly proudly calls itself as a tech intermediary.
Partnering with Retail Stores
Doing a Drizly app review meant checking its suppliers too. Having quality suppliers on board has always been a key focus for Drizly. Before partnering with any local liquor store, it conducts a thorough check on each store based on various parameters such as the store’s product range, product availability, product prices, delivery team, POS, etc.
Once the initial check is completed, Drizly then seamlessly integrates with the POS systems of all the chosen liquor retail stores, which automatically brings their store inventory online. With the technology that Drizly offers, all its partner stores are able to accept orders instantly and fulfill them efficiently in less than an hour.
For all these retailers, partnering with Drizly actually works as a boon. Many of these local stores who do not have a web presence or an online product catalog of their own are able to generate increased sales by simply leveraging Drizly’s platform, something which would not be possible otherwise. Drizly’s expansive reach, a strong customer base and a great brand recognition has been helping retailers to connect with many new consumers each day. According to a report, 50% of Drizly’s consumers have confirmed having shopped from a retailer for the first time using Drizly’s platform.
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Complying with the Law
Precisely, it’s a no-effort game for retailers. Without them having to undertake any sales or marketing initiatives, they are able to boost their sales and ensure steady revenues. The same report also reveals that 75% of Drizly’s users have been doing repeat purchases from the same retailer.
In order to maintain compliance with the law governing the legal drinking age, Drizly follows a strict age verification process, which makes sure that on-demand alcohol delivery to minors is completely prevented. While placing an order for alcohol on-demand through the Drizly app, the consumer is required to confirm his/ her age via an online verification process, before Drizly actually approves the order. Further, the drivers who are out for delivery make use of a unique ID verification mobile app, Mident, which allows them to scan the IDs of all customers who receive the orders. In case this verification doesn’t match, the drivers have been instructed to refuse the deliveries.
Revenue Model – How Does Drizly Make Money?
The start-up charges a monthly licensing fee from all its partners (liquor stores) who use Drizly’s platform. This monthly fee varies in the range of $100 to $10,000, and the amount usually depends upon a variety of factors like the value of the delivery, zone served, etc. Thereafter, Drizly does not charge any interest from its partner stores on any transaction, irrespective of the number of orders they receive or the number of deliveries they fulfil. All the money originating from the sales of liquor goes to the liquor stores only.
Also, Drizly does not increase the price of the product for the consumer, i.e. there is no mark-up on any of the products listed on its marketplace. The company only charges a delivery fee of $5 from its consumers.
What Makes Drizly Unique?
Since its inception in 2012, Drizly has been tirelessly working towards providing a unique, unparalleled experience to all its users, and this is what makes the start-up stand out among other on-demand liquor delivery players. Some of its noteworthy offerings, which are different from the others are listed below –
a) Ample Choice to Users – Drizly has over 2,000 different products listed on its marketplace, which gives consumers a pool of options to choose from. No other on-demand booze delivery player can boast of such a rich offering, which clearly gives Drizly an edge. Moreover, since there is no mark-up charged on any of the products, the fair pricing also works in Drizly’s favour.
b) Expansive Reach – Drizly delivers in more than 100 markets of North America, and there is simply no other on-demand liquor delivery player which caters to so many cities. .
c) c) Ease of use – The Drizly mobile app boasts of a rich, simple and user-friendly interface, and the consumers can easily explore drinks, compare prices and place their orders for alcohol on-demand through the app. This ease of use that the platform offers is one of the factors why it rose to popularity among consumers.
Customer Reviews of the App
Uber is Buying Alcohol Delivery Service Drizly Ffor $1.1 Billion
Uber announced today that it’s buying alcohol delivery service Drizly in a deal worth $1.1 billion, as the ride-sharing company continues to build out its stable of food and other delivery services.
The eventual plan is for Drizly’s marketplace of beer, wine, and liquor to be integrated into the existing Uber Eats application, giving Uber users a one-stop shop for both food and drink deliveries. The existing Drizly app will stick around, though.