The phrase “shop local” became even more of a rallying cry in the past year as small, local businesses in particular struggled amidst pandemic shutdowns and closures. Now more than ever, consumers are seeking ways to support local companies and brands, and this extends to alcohol, as consumers seek out the breweries, wineries, and distilleries located in their cities and states. 

This opens up opportunities for retailers to help their customers shop local by stocking local products. BevAlc Insights examined Drizly data to garner insights about demand for local brands, which markets shop local the most, and how retailers can use local brands to drive more sales.

Where Local Brands Thrive

California leads the country in local brand sales, which account for a 54 percent share of overall sales. The Golden State is also the only state where the local brands actually outperform national standouts in sales. In Oregon (40 percent share), Kentucky (31 percent share), and Washington (26 percent share), local brand sales also account for a significant share (over a quarter) of overall sales. 

Liz Paquette, Drizly’s head of consumer insights, surmises that the number of local products produced in each state correlates with local brand performance. This is especially evident in California, which produces 44 percent of American-made products sold nationally on Drizly. “Top-producing wine regions across the U.S. in states like California and Oregon drive them to the top of the list,” she says. “States that skew towards spirits production like Kentucky and Texas also directly correlate with strong local sales.”

Drizly’s Top States for Local Brand Sales

1. California
2. Oregon
3. Kentucky 
4. Washington 
5. Texas
6. Pennsylvania 
7. Colorado
8. Missouri
9. Massachusetts
10. Minnesota

Pride also comes into play and markets that have thriving local industries — think craft beer hotbeds like San Diego or Portland, Maine — are likely to be rich in it. As a result, local brand sales often skew higher in cities with a stronger showing of breweries, wineries, or distilleries than at the state level. In Texas, 23 percent of overall sales share on Drizly are local. By comparison, in Austin (one of the top U.S. cities for craft breweries), 29 percent share of sales are for Texas products. 

“There is a lot of state pride in Texas, and there have been plenty of outsider national brands that have tried to make inroads in Texas with mixed results,” says Nick Weiland, brand manager for Shiner, adding that Shiner has about a 30 percent share of the craft beer market in Texas. “The brands that have authentic Texas heritage and are still Texan-owned and Texas-made will always be successful here because of such strong pride in our home state.”

Beer Dominates Local Brand Sales

According to Drizly data, local brand sales skew significantly towards beer sales. While nationally, the beer category accounts for 18 percent share of overall alcohol sales on Drizly, beer accounts for nearly half the share of local brand sales, besting wine (29 percent share) and liquor (22 percent share). 

“Whereas wine and spirits production in the U.S. skews heavily to certain regions — for example, wine from California and whiskey from Kentucky — craft breweries are widespread across the country,” says Paquette, noting that a significant portion of wine and spirits sold on Drizly are produced internationally. “Further, many craft brewers have built loyal followings in their market through taprooms and on-premise presence, which often translates to off-premise sales.”

Weiland also points to loyalty-building as the secret sauce breweries use to grow local fanfare. “Local brewers have done a very good job of integrating themselves into their communities,” he says. “From collaborations, to using locally relevant product names and ingredients, to being involved in community and civic events, craft brewers make beers of the people for the people.”

While it’s currently the lowest share category for local sales, Paquette does anticipate local brand sales growth in the liquor category and suggests that retailers keep an eye out for new local distilleries in their area. “We have seen an increase in local distillers following the craft beer model and expect it to be a category to watch for local brand sales growth in the coming years,” she says. 

How Retailers Can Optimize Local Brand Sales

Overall, national brands do still comprise the majority of sales on Drizly. However, retailers can add local brands to diversify their inventory options and attract a range of consumers within each category.

While local brands do perform better in some states more than others, “all retailers, regardless of what market they operate in, should consider local brands when stocking their inventory,” says Paquette. She suggests that retailers find new local brands to add to their inventory by checking the “local” page on Drizly, which shows the top local brands selling online in each retailer’s market. 

Retailers can also stay up-to-date on local brands by welcoming input from customers and following local brands on social media — an approach that can also help a retail shop further cement its role in supporting the local community.