DoorDash introduced its alcohol category Monday, expanding upon a trend many restaurants hopped on during the COVID-19 pandemic.
The third-party platform will now deliver beer, wine, and liquor from restaurants, grocery stores, and convenience stores in 20 states, Washington D.C., Canada, and Australia. Altogether, the new DoorDash category will reach more than 100 million customers worldwide.
The select locations where the new offering is available depends on regional rules and legality. During the pandemic, 45 states updated laws to allow first and/or third-party delivery of alcohol. Many restaurants took advantage of these changes; seven in 10 full-service operators have added alcohol to-go since COVID, according to the National Restaurant Association.
“Over the past year, many cities where we operate evolved their legislation in order to permit the delivery of alcohol to residents’ homes. Over that time, we worked tirelessly to build a trusted alcohol ordering and delivery experience for merchants, customers and Dashers,” Caitlin Macnamara, DoorDash’s director of alcohol strategy and operations, said in a statement. “We’re committed to providing new earning opportunities for merchants and Dashers, a safe, high quality experience for customers, and being a responsible leader in compliant alcohol delivery.”
So far, DoorDash hosts thousands of local merchants on its Alcohol marketplace, illustrating the accelerating growth of the alcohol to-go market. A recent Nielsen report listed alcohol as the fastest growing e-commerce vertical among all consumer packaged goods. New data also suggests 56 percent of customers over the age of 21 would likely order alcoholic beverages if they were offered them as part of a food delivery order from a restaurant.
Under DoorDash’s new program DoubleDash, consumers can bundle alcohol from grocery stores and convenience stores with their restaurant food orders. Adding alcohol to a restaurant menu could increase average order values by up to 30 percent, DoorDash said, while it could boost convenience stores’ average order values by over 50 percent.
“We’re excited to expand our online business to reach guests in new ways and create special moments at home,” said Laura LaVigne, director of marketing at Lazy Dog Restaurant & Bar, in a statement. “It’s great to have the option to add handcrafted cocktails, a four-pack of our craft house beer, or wine to any celebration or casual meal as part of our partnership with DoorDash.”
As restaurants continue to explore alcohol to-go, the revenue channel has brought forth a multitude of legal considerations. Jennifer Smith Thomas, partner at RumbergerKirk law firm in Orlando, said there’s potential issues with state law compliance, overserving, insurance liability, and possible liability with third-party delivery companies.
Smith Thomas told FSR that restaurants need to do a cost-benefit analysis to determine whether they should keep serving alcohol to-go.
“If somebody takes a margarita cocktail kit and drinks all four of them and then gets in their car and drives into somebody else, those people are going to come after the restaurant,” the attorney said. “So, I think the restaurateurs need to consider their insurance coverage, their general liability policies, and whether or not this type of service is going to be included in their insurance policies.”
DoorDash has been vocal in its support of laws that will allow restaurants to add alcohol to delivery menus, but has also acknowledged the range of safety concerns. The company will require ID verification prior to checkout and multiple ID check points along the delivery and will partner with Responsibily.org and Students Against Destructive Decisions to raise further safety awareness. DoorDash is also giving users the ability to exclude themselves from receiving alcohol orders and alcohol-related direct marketing communication.
“We are proud to work alongside DoorDash to strengthen responsibility efforts in our communities and on our roadways by providing guidance and proven resources to help prevent impaired driving and underage drinking,” Chris Swonger, president and CEO of Distilled Spirits Council of the United States and Responsibility.org, said in a statement. “Whether you’re a Dasher, a restaurant employee, or a customer – we are all stronger when we’re united by a commitment to a culture of alcohol responsibility.”