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drizly

US largest liquor Platform, Drizly, creates new Revenue Stream

Boston-based Drizly is North America’s largest e-commerce and delivery platform for beer, wine, and spirits. It connects shoppers with local outlets—from retail chain locations to mom-and-pop liquor stores—allowing them to shop the biggest selection of beer, wine, and spirits online.

READ MORE How did Vivino become so powerful with data?

Since its founding in 2012, Drizly has expanded to more than 1,400 cities in the United States and Canada, including two-thirds of U.S. states. Recognizing this strong position, Uber acquired the company in early 2021 for $1.1 billion.

The COVID-19 pandemic brought transformational changes for Drizly as homebound consumers overnight turned to delivery services en masse. The platform saw 800% sales growth at the early onset of the pandemic. That success hinged in large part on data.

Here is a series of 3 articles to explain how leaders in the wine and beer industries have become so powerful thanks to data. The articles will be published every Monday. The first article is about Vivino, the largest online wine marketplace. The second article will be about the leader AB-InBev which markets the beer brands Budweiser, Corona and Stella Artois. Finally the third article is about the American leader in online sales Drizly.

Drizly made use of Looker—business intelligence and data application platform of Google Cloud—for internal analytics to support account management and sales teams as they met the demand surge. Their use of data proved to be a strategic resource to provide insights into customer behavior, drive investment decisions, and boost growth.

Drizly expanded their use of Looker to go beyond traditional BI and develop a new product, built with embedded analytics, that monetized this data to create a new revenue stream.

READ MORE This beer’s for you: AB InBev uses AI and ML

BI: Upgrading the data stack

As the first company to offer its service model in the liquor market, Drizly experienced rapid growth even before the pandemic. With that expansion, the company recognized a need to upgrade its data stack to support efficient scaling.

“Our previous BI tool created a lot of untrustworthy tangled webs,” recalls Athena Casarotto, Associate BI Manager at Drizly. “People were repeating work, and there was no organization. The tool was turning into a junk drawer, and no one knew how to sift through all the stuff in there. It was easier to make something from scratch than to find it.”

As the infrastructure project was unfolding, Drizly was expanding again to meet the growth that the pandemic brought, taxing its resources. First-time users flocked to the platform, and new markets opened as state restrictions changed. The company needed real-time insights to enable employees to meet the demand surge and deliver the best possible experience on the Drizly marketplace.

We needed this to scale with our business, so we didn’t want to create a ton of custom reporting.

Rocky Martin, former Drizly Strategic Partnerships Analytics Lead

Finding a solution that business users love…and trust

As Drizly considered a replacement, it evaluated two solutions: a visualization tool and Looker. The top selection criteria were flexibility, compatibility, data governance, and the self-service user experience.

In a trial, Drizly business users had the opportunity to work with Looker’s Google BI tool and compare the solution to the incumbent tool and the other visualization tool. The feedback was enthusiastic about Looker’s interface, ease of use, and visualizations. The analytics team was also confident that Looker would provide the data governance and trusted self-service they needed, while making the most of the tools and processes already in place.

After extensive side-by-side comparison, the company chose Looker and worked with Montreal Analytics, a cloud and data consulting firm, to implement the platform. The firm’s experience with the solution and its guidance on best practices for setup and scaling helped Drizly accelerate their time-to-value.

Data helps account managers save the day during the pandemic

Account managers were stretched by the pandemic, helping new retailers to get going on the platform and supporting stores that struggled to fulfill the surge in customer orders. The team used Looker to optimize the retailer experience and identify coverage gaps, such as hours when stores were not online or products which did not meet customer demand.

Our account managers were the biggest heroes to our retailers during this time

Athena Casarotto, Associate BI Manager at Drizly

The account management team relies on Google BI tool as their go-to place to support retailers and help stores succeed. Using Looker, Drizly can tell retailers which hours and products have the highest demand so they can fine-tune their schedules and inventory. This contributes to sales growth and builds closer, trusted retailer relationships. The sellers benefit from a greater ability to understand and meet market demands, which helps them enhance their customer experience.

Mapping strategic growth opportunities

Using Google BI tool to identify gaps helps Drizly’s sales team prioritize opportunities and create faster growth. They use this intelligence to drive decisions on expanding into new markets, adding retailers to the platform, and making strategic investments. For example, Drizly understands where to prioritize adding new liquor stores to its marketplace based on geographic data about untapped customer demand. With these insights, the team can quickly identify and act on opportunities and respond to consumer needs.

Furthermore, Drizly uses geospatial analytics to get hyper-local insights on market level data. Using maps in Looker, the team can go beyond identifying how many retailers they have in an area to further identify their highest areas of utilization.

“For example, we have great coverage in New York City when looking at the ‘count of stores.’ However, using geospatial data we can see exactly where we’re hitting capacity six times faster than the rest of the city to help us assess the greatest needs and potential at a more specific level,” shares Casarotto.

Jake Smart, Manager of Production Data Science and Machine Learning Engineering at Drizly, adds, “We set out to unlock the ability for our analysts to work dexterously with the geospatial data. To do so, we took maps and created location-specific polygon tiles to provide more granular (more detailed) insights into comparable area units. Bringing all of this together helps us understand a lot more about our orders, deliveries, new stores, and inventory. We can also combine this with external datasets such as census or weather data, which is very powerful for our growth strategy.”

Quickly unlocking insights into the customer journey for brands

Drizly realized there was an opportunity to go beyond its internal use of analytics. Commonly, companies experiencing seismic shifts in their business are unable to act on new opportunities because of limited real-time access to data and constrained resources. However, Drizly swiftly capitalized on the possibilities offered by its data despite the pandemic pressure. The company saw potential to provide even more value to its retailer partners and brands of all sizes, which didn’t have insights into their consumer experience.

From working with the Google BU tool, Drizly understood that leveraging embedded analytics to build a data product could offer valuable strategic insights to these companies. Moreover, the initiative was doable because the Drizly team could use their existing data infrastructure to maximum advantage. This meant the company did not have to divert engineers from the business to work on building analytics from the ground up.

To accelerate their time to market, Drizly relied on the expertise of Hashpath, a data analytics consulting firm, and their White Label Data platform. Hashpath quickly put their Google BI tool’s Looker’s expertise to work by developing a wealth of product components, from authentication and onboarding to user groups and navigation, employing best practices to ensure long-term success for users and administrators.

With Hashpath’s help, Drizly used embedded analytics with Looker to create a product with multiple pricing tiers and introduce a new revenue stream in less than six months. This product provides real-time visibility and insights on sales patterns of the 5,000 brands on its platform to suppliers and retailers.

Our internal analytics were the foundational project for the new customer insights portal.

Rocky Martin, former Drizly Strategic Partnerships Analytics Lead

Casarotto says the ease of implementing access restrictions for external users was a factor in the project’s success. The new product offers various pricing tiers and packages, so Drizly can serve a broad audience of vendors and retailers and deliver what they need—whether they’re a global brand that wants to delve into customer insights or a smaller regional producer that’s just getting started with customer analysis.

The tiered approach gives Drizly customers the flexibility to move up when they are ready to gain greater understanding of their brand within the market. Demand for the product is strong, with revenue growing 25% year-over-year.

In the first year of launching the new product, the benefits included:

  • Creating value for customers and a new revenue stream for Drizly that had 25% year-over-year growth.
  • Stronger go-to-market strategy for the brand sales team.
  • Reduced administrative burden for setup, contract creation, and security for client-facing data.

Looking forward to even more growth potential

Drizly’s adoption of Google BI tool’s Looker was central to its ability to quickly react to help retailers meet scaling demand during the pandemic. Ultimately, Drizly’s effective use of data helped the company achieve 8x revenue growth and strategically evolve its business.

Moreover, Looker has enabled Drizly to enter a new line of business: creating a data product to help suppliers understand and take action on sales and competitive trends. This generated a revenue stream in under six months, with little additional technical investment.

Looking forward, Drizly sees even greater growth potential in embedded analytics and anticipates taking advantage of Looker for more such products.