Booze just click away, and a walk to convenience store

Industry

Booze just click away, and a walk to convenience store

Published: 26 May. 2020, 19:38

Online shopping for booze has been allowed since April 3, and internet sales of wine have been booming.

The pandemic has certainly helped, as the social distancing rules, work-at-home directives and self-quarantine have created a demand for products that help people kill time at home and party outside of bars and clubs.

Smart ordering systems allow customers to order beer, wine, makgeolli and other drinks with a mobile app. Customers only have to prove their age when they pick up their orders.

Convenience stores become wine sellers

Wine makers and convenience stores are expected to be the biggest beneficiaries of mobile ordering. Smart ordering systems allow convenience stores to better manage and deliver wine, a product once considered hard to carry due to the wide variety of products available. Inventory can be better controlled and more products can be offered.

“This law allows people to order and pick up wine at their nearest convenience store without having to go to a professional wine shop,” said an industry source. “Since prices are transparent to everyone this will help lower the overall retail price of wine.”

Convenience store chains are reacting swiftly to the change.

A customer examines the wine shelf at the GS25 convenience store in the Parnas Mall branch. [GS RETAIL]

GS25 has been testing its own wine reservation system, Wine25, since December. The company reported sales of wine to have increased by more than 70 percent at its 600 testbeds located in the Gangnam, Seocho and Songpa Districts, compared to before it introduced the system.

The convenience store chain said it is building a smart ordering system for their online consumers of wine, where people can place orders and make payments at once.

“In the new system, orders and payments will be made simultaneously, and the only thing customers have to do is come to our convenience store to verify their age and pick their product up. [Once the system is up and running] we anticipate sales of wine to grow even more,” said GS25.

Emart 24 partnered with a wine curating company last January to attract wine shoppers to their stores. Customers can order bottles of wine through their partnering sellers and pick up their bottles at Emart 24 stores offline. After the system was in place, the convenience store chain reported sales of wine increasing by 783.9 percent through April, compared to the same period a year earlier.

“We are trying to strengthen the wine division and expand stores that offer a larger variety of wine to meet the growing number of wine drinkers,” said Seon Ah-reum, a buyer of Emart 24.

Mobile ordering of alcohol allowed last month

Various alcoholic beverages, including beer and makgeolli, are displayed on the shelves of the liquor section in a retail store in Seoul. The government revised the taxation system for alcohol last January, the first revision in 50 years. [NEWS1]

Starting last month, the National Tax Service allowed retail businesses like restaurants and convenience stores to sell alcoholic beverages on mobile platforms. While systems where consumers place an order and pick up later was widely used in various industries, including restaurants and coffee shops, alcoholic beverages were an exception, out of concern that it would make alcohol accessible to underage customers. Internet-ordering of alcoholic beverages online was limited to traditional drinks, such as artisanal soju, to promote traditional breweries and manufacturers.

The government decided to allow online and mail order of all alcohol, along with systems that enable people to verify their age online. However, this is only under the condition that the actual buyer visits the store in person to receive their order. The direct purchase of alcohol online is still illegal.

Wine sales surge after revision

Shinsegae Department Store said online sales of wine from its SSG.com e-commerce site from April 27 through May 22 increased 45.9 percent compared to the same period last year. After the revision passed the National Assembly, Shinsegae Department Store opened “Shinsegae Wine House”, the department store’s online wine shop, where customers can order and purchase wine from their online platform.

The main page of "Shinsegae Wine House," the online wine shop in Shinsegae Department Store's e-commerce site, SSG.COM. [SHINSEGAE DEPARTMENT STORE]

Shinsegae said on average 50 orders are placed daily on its online wine shop, generating more than around 3-million-won ($2,430) of sales. This is close to the daily sales of the cosmetics section at some of its mid-sized stores, including the Yeongdungpo and Daegu branches.

“Even though it is a hassle to come out to the store and pick up their bottles, customers still do it. They are pushing sales of products that accompany wine like cheese and charcuterie,” said an official from Shinsegae Department Store.

Drink-at-home trend makes wine mainstream

Since online malls and credit card companies offer discounts and vouchers for online shoppers, consumers can enjoy the same bottle of wine at a 10 to 15 percent discount.

The coronavirus also had an effect. More people have started to seek ways to buy with minimal contact. Home parties and home drinking have become more popular and acceptable. Drinking is now less about special occasions and celebrations.

“After the revision passed and demand grew from more people throwing parties at home, we are seeing an uptick in sales of wine at our department stores, said Choi Won-joon, a manager of food and beverages at Shinsegae Department Store. “We estimate the number of wine consumers to steadily increase in the future, and plan to double the number of labels offered at our stores to 400 by the end of this year.”

BY KWAK JAE-MIN [kang.jaeeun@joongang.co.kr]