Drizly: Managing Supply and Demand through Disruption

It was April 6th, 2020, and the management team at Drizly—an online alcohol marketplace where consumers could browse and purchase alcohol from local liquor retail stores via Drizly’s app for immediate home delivery—were thrilled to see record-breaking sales from the demand surge brought on by the COVID-19 pandemic. For the 10th straight day, gross merchandise value (GMV) sold through Drizly’s online alcohol marketplace had surpassed Drizly’s GMV on New Year’s Eve—typically Drizly’s busiest day of the year. But their excitement didn’t come without serious concerns. The average delivery time well-exceeded the 60-minute customer promise, the void rate—the percent of orders that were subsequently canceled by either the consumer or retailer prior to delivery—was experiencing a five-fold increase over pre-COVID-19 levels, and the number of customer complaints were on the rise and not being answered in a timely manner. What should Drizly do to ensure the long-term success of the company?