PHOENIX -- As restaurants battle for market share and seek out creative ways to boost check averages, at least one of their solutions is likely coming at the expense of beer and wine retailer.
In recent months, there has been an increase in the trial of beer and wine being delivered along with food, according to a report in CSP sister publication Restaurant Business. The interest isn’t concentrated in one type of restaurant, either; it’s being embraced by casual-dining chains such as Buffalo Wild Wings and BJ’s Restaurants, all the way to quick-service restaurants such as Pizza Hut.
Signs suggest that beer delivery has legs; some chains report seeing incremental sales spike, and others say they plan to expand their programs. “If you can make it work, it’s something that’s a no-brainer,” David Henkes, senior principal for researcher Technomic, told RB. But that does not apply to every brand, he said. It makes the most sense for beer-heavy chains that can support that positioning with options such as delivery.
Here's a look at how some restaurants are faring with this relatively new aspect of their businesses ...
Buffalo Wild Wings
Buffalo Wild Wings (BWW) is testing beer delivery at 19 locations in California with hopes of expanding the service to other markets in other states, said Andrea Schwenk, the company's beverage director. Initial results show that check averages increase about $10 on beer delivery orders, she said, and those beer sales appear to be totally incremental. What’s more, BWW’s beer-delivery restaurants are outperforming those that only sell beer to go. And in those markets that offer both beer delivery and beer to go, she said, about 60% of the alcohol sold is from delivery orders. “We’re constantly looking for new and innovative ways to reach our fans and deliver them what they want, when they want it, where they want it,” said Schwenk.
BWW has learned that there’s still relatively little consumer awareness around beer delivery from casual-dining restaurants. To grow sales through this channel, the chain continues to focus on spreading word of its service. And it’s also expanding its alcohol delivery program: It’s testing wine and also allowing customers to make their own domestic or imported six-packs for delivery.
So far, beer delivery is most popular at dinnertime, accounting for about half of orders. But there’s also a late-night increase after 9 p.m. that accounts for roughly one-third of orders, Schwenk said.
Pizza Hut says it, too, plans to expand its new beer-delivery program, although the chain declined to specifically discuss sales. “Who doesn’t love cold beer and hot pizza?” said Stacy Lynn Bourgeois, director of marketing for Pizza Hut. And that pairing of temperatures was a key lesson for the chain: Pizza Hut had to find coolers that would keep beer at the right temperature for delivery. So far, it’s worked, said Bourgeois.
Earlier this year, Pizza Hut expanded its test program, conducted in Arizona, to include some of its stores in the Phoenix market. And in February, Pizza Hut began testing wine delivery. The chain is testing different sizes of wine bottles, as well as an expanded beer selection.
“Consumers love that it’s a one-stop shop,” said Bourgeois. Consumers also appreciate that besides delivering familiar national brands such as Budweiser, Pizza Hut also is delivering local craft-beer favorites, she said. Pizza Hut now has 1,600 stores with beer or wine.
One challenge for alcohol delivery is staff. Chains need to consider the age of the staffer working the takeout counter and fulfilling takeout orders, Schwenk of Pizza Hut said. BWW passes the responsibility of checking customer IDs, though, to its delivery partner, DoorDash. Because Pizza Hut uses its own delivery drivers and not a third-party delivery service, Bourgeois said there are actually fewer complications. Pizza Hut has had to train drivers how to check and verify IDs at customers' homes, but it is not relying on another company to do the checking.
While Bourgeois declined to say if or when Pizza Hut might roll out beer and wine delivery nationally, she did say, “Our goal is to roll out as quickly as possible.”