Across the world, younger legal age drinkers were happier to spend extra on quick delivery.

IWSR has investigated the consumer appetite for increased spending on delivery within one hour of ordering across 16 focus markets, including Australia.

Findings of IWSR’s analysis illustrate that delivery speed is a “key battle ground for online alcohol sales,” with millenials in Australia among the most willing to spend more for rapid alcohol delivery.

Guy Wolfe, Strategic Insights Manager at IWSR, stated that: “Although consumers in different global markets place different levels of importance on delivery speed, one clear trend that we’ve identified is that speed is growing in importance everywhere.”

In Australia, the willingness of millennials to pay extra for fast delivery was slightly above the global average, while those in the baby boomer generation were significantly more hesitant.

As Wolfe says: “Millennials in all markets are strongly willing to pay more for fast delivery. Boomers, on the other hand, are currently unwilling in general.”

IWSR also found that wait time continues to be a barrier to ordering alcohol online for certain consumers, with just over one fifth (21 per cent) of those surveyed stating that waiting for delivery is a deterrent to purchase. Legal drinking aged Gen Z and millennial consumers placed particular importance on this issue.

Additionally, about a third of all respondents cited delivery fees as an off-putting factor, while 11 per cent were concerned about the possibility of their delivery getting stolen or misplaced.

The rapid delivery space in the Australian market has seen great expansion in recent years, with Jimmy Brings’ launch in 2015 followed by other quick delivery offerings, including Shorty’s Liquor, BWS’ one hour delivery and Dan Murphy’s two-hour delivery.

Food courier services like Uber Eats have also added rapid alcohol delivery services to their repertoire, beginning in some locations in 2017. Then in 2021, Uber purchased American rapid alcohol delivery service Drizly for USD$1.1bn, and the merger of the two companies is expected to increase reach to 6,000 American cities.

However, a period of consolidation maybe ahead for the rapid alcohol delivery industry, as the IWSR report explains.

“On-demand delivery is highly capital intensive,” the report states. “As the number of providers rise, increased competition, coupled with a general slowdown in e-commerce post-pandemic, is proving to be problematic for some.”

The report gives the example of European ‘instant delivery firm’, Gopuff, a firm that operates across the US and Europe, employing some 15,000 people. Gopuff recently announced plans to cut three per cent of its global workforce, while Doordash, one of the most prominent food and drink delivery services in the US, has experienced a significant drop in share price in late 2021.

The IWSR’s report then paints a picture of a sector of the market that is growing and commanding the interest of younger consumers, but not without its own challenges and risks.

Read the full report here.

Leave a comment

Your email address will not be published.