Kroger Expands into Alcohol E-Commerce Market
The grocer is the first to offer alcohol as part of their digital delivery options, a move that places them atop of the lucrative sector.
Need to Know
- Kroger and DRINKS have partnered to roll out a build-your-own pack wine delivery service, the first of its kind in a growing market space.
- Major retailers like Amazon, Walmart and Target have been making progress in the adult beverage e-commerce space but strict laws have prevented a national rollout of any campaigns.
- The alcohol industry brings in $250 billion per year and has seen a steady market increase year-over-year.
Analysis
US grocer Kroger has expanded its DRINKS partnership, targeting the alcohol e-commerce sector. The service—currently available in 19 states as well as Washington DC—reaches over 58 million US households and gives Kroger customers the ability to build their own selection of wines. The alcohol is then delivered in accordance with state and local regulations.
“We are proud of our partnership with Kroger, which achieves the vision of making great wine accessible to more American households in the way consumers are increasingly shopping—online,” said Zac Brandenberg, co-founder and CEO of DRINKS. “By leveraging our scalable platform, Kroger became the first grocery retailer of its kind to offer a ship-to-home wine program that brings the flexibility, convenience and personalization of e-commerce to the wine shopping experience.”
The build-your-own program establishes Kroger as the first grocery retailer to launch a ship-to-home wine service. But with the alcohol industry currently worth over $250 billion and off-premises wine sales accounting for $70 billion, undoubtedly they won’t be alone for long.
Large scale grocery retailers like Walmart, Target, and Amazon have had their eye on the lucrative adult beverage space but due in part to the sector’s strict regulations no one has been able to fully roll out a national delivery program.
Walmart is the closest behind Kroger, introducing alcohol into its grocery pickup service in October. The program was made available in 28 states and depending on local laws allowed for the pickup up wine and spirit; pending identification verification upon pickup.
To purchase using the build-your-own wine service, Kroger shoppers must confirm their delivery state and legal drinking age before completing the transaction.
