Uber to shut down Drizly

The service that kept countless Americans stocked up on beer, wine and booze during the pandemic will deliver its last bottle this spring.

Uber confirmed that it will shut down Drizly, the alcohol-delivery service it acquired in 2021, at the end of March.

“After three years of Drizly operating independently within the Uber family, we’ve decided to close the business and focus on our core Uber Eats strategy of helping consumers get almost anything — from food to groceries to alcohol — all on a single app,” Pierre Dimitri Gore-Coty, senior vice president of delivery, said in a statement to The Washington Post.

The decision to shutter Drizly is apparently based on business redundancies and convenience.

Consumers, an Uber spokeswoman noted, prefer to use a single app when ordering deliveries, and the alcohol category on Uber Eats had already doubled globally in the last year.

The Uber Eats app has the ability to deliver alcohol to 35 states, including Iowa, and more than 25 countries around the world, she said.

In Iowa

The Iowa Legislature passed House File 766, effective July 1, 2021, to allow home delivery of alcohol in Iowa.

Initially, Drizly’s services in Cedar Rapids, Coralville and Iowa City were mostly available through Kum & Go locations, beginning in October 2021. Instacart also was delivering alcohol for Costco and Aldi.

Passage of the new delivery law was driven by the grocery industry — not the restaurant industry, Jessica Dunker, president and chief executive officer of the Iowa Restaurant Association, told The Gazette at the time.

Consumer impact

The loss of Drizly apparently will not cause consumers much grief. The majority of Drizly users, a spokeswoman said, also have Uber accounts. As of the third quarter of 2023, Uber had 142 million active monthly users.

Founded in 2012 by Cory Rellas, Justin Robinson, Nicholas Rellas and Spencer Frazier, Drizly partners with retail to deliver alcohol directly to consumers.

The Boston-based company’s sales skyrocketed during the pandemic, when Americans increased their drinking habits while stuck at home. In 2020, Drizly reported that its sales increased 350 percent over the previous year. Sales peaked in April 17, 2020, with a reported 1,000 percent increase compared to sales a year earlier.

Uber acquired Drizly in 2021 as part of the San Francisco-based company’s strategy to diversify its business while demand for ride shares plummeted during the pandemic. Uber shelled out $1.1 billion in cash and stock for the acquisition.

At its peak, Drizly delivered alcohol in 36 states and more than 1,500 cities. Many jurisdictions had to change or suspend their laws to allow for alcohol delivery during the pandemic.

It’s not clear how many employees work at Drizly, but an Uber spokeswoman said there are no immediate layoffs. However, she said Uber will eliminate some Drizly jobs, as well as jobs at Uber that support Drizly, once the alcohol-delivery business ends in March. Some of those employees, she said, will be offered jobs at Uber based on company needs.