As restaurants across the country are forced to close their dining rooms due to the coronavirus pandemic, many have pivoted to food delivery and curbside pickup as a means to survive. In a move to help the struggling industry, liquor authorities in states like New York, Illinois, Colorado, Texas and California eased restrictions, allowing businesses that hold on-premise alcohol sales licenses to temporarily sell beer, wine and liquor to-go with the purchase of food.
Overnight, fine-dining restaurants with deep cellars have not only set up to-go food, wine and beverage menus, but some are also turning their wine cellar into an online retail shop. But are these efforts paying off? And how long are customers willing to spend big during an economic crisis?
"Restaurant sales are drastically down," said Brian Hider, wine director of Wine Spectator Grand Award winner Pluckemin Inn in Bedminster, N.J. "We're not selling alcohol in the restaurant right now, and that's probably 40 percent of the revenue generated. Right off the bat, that's out the door."
However, the Pluckemin Inn's saving grace, apart from to-go food and wine menus that Hider says are doing well, is the restaurant's online wine retail shop, Plucky Wines. "In March the numbers are up 65 percent compared to last year," said Hider. "And it's not just everyday wines either; we saw the everyday traffic jump up, but I found new customers buying high-end wines that you wouldn't think people are buying in this type of a crisis, like $1,000 bottles of wine."
So far, the retail shop has allowed Hider to protect the trophy wines on his 6,000-selection wine list. "I'd like to keep the integrity of the list, to keep the library of things,” he said. “But if someone was really looking for something that's on this list, I would see if I would be willing to sell it."
Building off of the increase in online wine sales, Hider is now offering virtual tastings for some of his clients. "I have an online virtual tasting scheduled with a couple of clients next week. One bought a bunch of Echézeaux [and] wants to share it with a bunch of his friends and have me talk about it."
Not all restaurants have the online retail infrastructure in place and aren't able to adapt as quickly, but third-party platforms, like Somm.ai, are helping fulfill that need.
According to founder David Kong, Somm.ai was launched in late-2019 as a platform for consumers "to drink better wine when they are at a restaurant," by making wine lists for many restaurants searchable and accessible. But with the COVID-19 crisis, Kong repurposed the site in mid-March, creating Shop.Somm.ai, to help restaurants sell their wine. "We're slowly getting restaurants onto the platform that want to sell their wine. And we want to make it easy for consumers to add wines to their cart, search for wines across the restaurants and then buy the wines," explained Kong, "And then we work with the restaurant to get the wines fulfilled."
Over 50 restaurants and retail shops across the country are on Shop.Somm.ai and over $50,000 in sales have been generated. "Somm.ai is completely free; it's non-profit," said Kong. According to him, the median price per bottle sold on the site is $225 and the most expensive bottle sold so far was a Domaine Georges Roumier Chambolle-Musigny Les Amoureuses 2004 for $1,065.
Most recently, Somm.ai worked with Landry's to offer a customized platform for the company's crown-jewel cellar at Mastro's at the Post Oak in Houston. Landry's launched a "Wine Concierge Service" on April 9, opening up the Grand Award winner's 35,000-bottle cellar for purchase, with discounted selections ranging from Chateau Ste. Michelle Chardonnay Columbia Valley 2015 for $20 to Domaine de la Romanée-Conti Vosne-Romanee 2011 for $15,920.
Chappy Cottrell, wine director of Barndiva in Healdsburg, Calif., is currently selling 585 wines from the restaurant's cellar on Shop.Somm.ai. "I think it's a game changer," says Cottrell of the newly launched site. "They're working out the kinks in the software, but it makes it super easy to essentially upload your entire wine list as a PDF, set your discount prices, make your markup of how high you want to go, how low you can go and it converts it all into an e-commerce shop in 20 seconds."
Because Barndiva is situated in the heart of California wine country, Cottrell is hoping to differentiate by selling at a discount Burgundy and other Old World wines, which make up 60 percent of his wine list, "We're offering 20 percent off our full wine list. A few exceptions are [wines from Domaine de la Romanée-Conti] and stuff like that."
Dropping wine prices to retail level is key for many restaurants selling wine to-go. For Caleb Ganzer of New York City's La Compagnie des Vins Surnaturels, "cashflow is the name of the game right now," which is why he is offering the vast majority of his 1,650 wine list at a 25 percent discount.
He's had notable success, though, selling assortments of wine packs. "We've put out $75 wine packs, a couple bottles of wine with a little bit of food. We've put out four-packs for $95. We have the 'supernatural' pack with six wines for $195, those have been very, very successful. We've already gone through a dozen cases of wine through those packs," explained Ganzer. "It's that sweet spot of $30ish a bottle where I think people know they are going to get the best value."
But as the shelter-in-place restrictions are extending beyond what was originally anticipated, some restaurateurs are noticing changes in their customers' buying behavior.
Ryan Fletter, owner of Grand Award winner Barolo Grill in Denver, has been cautiously selling wine to-go since Gov. Jared Polis temporarily eased restrictions. "During the first few days, so many of our guests said, 'Hey here's $200, give me a great Barolo or Brunello,' or, 'Here's a few hundred bucks, give me a great white Burgundy. You choose Ryan,’" said Fletter.
At first wine, liquor and beer sales to-go were 40 percent of his sales. Currently it's at about 20 percent. Fletter believes the drop is due to wine sales at retailers, which have filled up customers' home bars.
He's also seen a change in behavior with customers' spending habits. "What we're noticing in the last couple of weeks is that people are starting to purchase lower-priced items," said Fletter. "I am not sure if the exhaustion of the financials are starting to enter the mindset of the guests now that this is going to go longer. So we're continuously trying to offer lower-priced items to keep our guests feeling that they can still find value and have it be affordable in the midst of what is an economic and health crisis." Currently, Fletter's strategy includes keeping wine selections fresh and focusing on selling wines in the $20 to $25 range.
In these unprecedented times, restaurants have to adapt in order to survive. But if any industry is able to do that, it's this one, according to Fletter. "'Keep on going, keep on swimming, even through major adversity, is kind of the middle name of us restaurateurs."