WSWA Challenges Sovos Finding 87% Back DtC Spirits Laws

Saying Sovos ShipCompliant "handpicked data" in a recent report to show that direct shipping legislation enjoyed broad support among consumers, Wine & Spirits Wholesalers of America said that Sovos' claim that “87% of regular craft spirits drinkers say they want to be able to legally purchase craft spirits via DTC shipping,” ignores the fact that less than 30% of those surveyed responded.

The survey was conducted in conjunction with the American Craft Spirits Association. Not only did Sovos fail to disclose that it had only a relatively narrow response rate, but that most responders "were college educated men under the age of 34 with a household annual income above $100,000 – not the broad base of support the headline implies," WSWA said.

WSWA also took issue with the report’s assertion that 81% of regular craft drinkers would be more likely to try new craft spirits brands if they were able to purchase them through DTC shipping, calling it "dubious at best."

"Consumers are much more likely to discover craft brands through retailers, on premise and off, when individual interaction and tastings can help people determine what product is right for their taste," WSWA said.

In truth, WSWA said, craft spirits are booming under the three-tiered system.  Craft producers have grown 14% growth, with craft spirits sales showing an impressive 7% increase by volume and a 10% surge in retail value over the last five years.

WSWA said SOVOS also disregards risks associated with multi-national producers dominating the online landscape if DTC shipping were to take over.  

Legislators haven't expanded DTC spirits shipping because they are responding to consumer concerns that DTC shipping would increase underage alcohol access, undermine the integrity of the existing regulatory framework, and compromise local public health and safety, WSWA said.

No state passed DTC spirits legislation since Kentucky did so in 2020, and the number of state legislatures even considering the issue has dwindled year after year.  For example, while 15 states introduced DTC spirits legislation in 2022, and only seven did so in 2023, WSWA said.

"In fact, in Texas – a state identified by SOVOS as “giv[ing] hope for successful [DTC legislation] in the future” – industry associations from all three tiers have banded together to oppose DTC spirits shipping for future legislative sessions, including the Texas Distilled Spirits Association (TDSA). This compromise between the tiers was rooted in an understanding that public health and safety are paramount when considering alcohol legislation, and that DTC spirits shipping directly threatens these values, WAWA said.

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