Underwritten: The secrets of how to sell drinks online

As PepsiCo’s recent acquisition of independent prebiotic soda brand Poppi for nearly $2 billion reinforces, it’s a brilliant time to grow a beverage brand.

This is especially true if you can answer a growing consumer need, whether it be alcohol alternatives or simply more sustainable packaging of age-old products like water.

Although the drinks category is filled with new challenger brands, learning how to sell drinks online isn’t easy. And for many beverage entrepreneurs, securing shelf space in the drinks refrigerator of a nationwide chain is actually the ultimate goal.

So, what’s the playbook required to perfect the art of selling drinks online, and what can we learn from the game-changing brands who have made millions doing it?

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How to sell drinks online: Why is it so challenging?

1. The consumer mindset challenge

One of the biggest hurdles for beverage brands selling online stems from consumer behavior. Buying a drink is often an impulse decision.

Picture this: you’re standing in line, notice an ice-cold can, and suddenly realize you’re thirsty. That craving is satisfied within moments. It’s the ultimate spur-of-the-moment purchase.

Online, no matter how fast your shipping is, you can’t replicate that instant gratification. This begs the question, what are online beverage brands really selling? (We’ll come back to this later.)

Overcoming this challenge requires understanding your audience on a deeper level and creating a compelling reason to choose your beverage—even if it means waiting a few days for delivery.

2. The operational hurdles

Beyond consumer psychology, the DTC beverage model has operational constraints. Margins are tight, with gross margins around 30% considered stellar.

Large storage spaces are required, and trying to move such heavy product means that shipping is expensive. This eats further into those margins. Layer on the costs of marketing, branding and R&D and the financial pressures add up quickly.

To survive, beverage brands must prioritize efficiency in customer acquisition and maximize every dollar spent. This is why we can learn so much from challenger brands like Liquid Death and Brēz.

What does Wayflyer’s customer data tell us about how to sell drinks online?

It’s a significant, growing eCommerce category:

Nearly one in ten (9%) businesses that have ever taken a Cash Advance with Wayflyer are in the food and beverage industry.

It doesn’t require as much financing:

Food and beverage customers received funding from Wayflyer, which was, on a weighted average, 18% smaller than the average funding amount.

But it’s potentially a slower revenue play:

Wayflyer’s food and beverage customers had an annual revenue (most recent 12 month period) that was 30% smaller than the weighted average of all industries.

Why try to sell drinks online at all then?

As Jose Ramirez, founder of non-alcoholic beverage HOPR describes, “I was told I needed to go to the supermarkets, bottle shops and hotels. I went door knocking, basically trying to educate the market. And they asked, ‘how much is it’? I said X. And then they asked, ‘Can you make it cheaper?’”

When you're starting out, you're producing small batches which makes the cost of your goods very expensive. Therefore, it's hard to sell to retailers who want to take a sizeable margin and likely want to buy them close to the cost that you paid for them. So cracking your D2C market first is a non-negotiable.

But breaking past the initial barriers to reach buyers is far from easy. For this reason, countless operators are turning to the internet to sell their drinks directly to consumers, drawn by the promise of higher margins and fewer obstacles.

However, entering the direct-to-consumer (DTC) beverage market isn’t a walk in the park either. It’s a tough game that requires innovation, strategy, and resilience. But for those who get it right, the rewards can be transformational.

Let’s explore some of the challenges and examine how three game-changing brands—Liquid Death, Brēz, and Recess—have managed to stand out with strategies designed for DTC success.

By leaning into these lessons, your brand can find the quickest route to thriving in this competitive space.

How to sell drinks online: the key strategies

Strategy 1: Creativity lowers customer acquisition costs

A standout example of creative marketing driving success across every category is Liquid Death.

This $2.8 million startup rocketed to over $333 million in revenue within five short years. Their secret? They became a digital media powerhouse first and a beverage brand second.

Their comedic, viral video content, unique merchandise (who can forget the Steve-O voodoo dolls?), and bold publicity stunts not only built hype but also slashed customer acquisition costs (CAC).

Take their Recycled Plastic Surgery Centre ad—that campaign alone generated so much buzz that retailers were soon queuing to stock their products.

More importantly, they built massive earned media, with social media engagement numbers that most brands only dream about.

Today, Liquid Death is recognized by 34% of the U.S. population, boasts millions of followers, and commands a valuation exceeding $1.4 billion.

The takeaway? Creative branding that sparks emotion (and laughter) cuts through digital noise, helping reduce ad spend and boosting brand equity.

Strategy 2: Lifetime Value (LTV) is everything

Brēz, a rising name in the functional beverage space, offers another vital lesson in DTC success.

Instead of leaning on entertaining content, Brēz zeroed in on what they do best—data-driven digital marketing. Their strategy revolves around PPC ads, email funnels, and social media campaigns, all geared toward optimizing subscription models and retention.

Understanding that beverage sales struggle with margins, Brēz aims less for profit on the first sale and more for long-term gains.

Their lifetime value (LTV) focus allows them to stretch to a higher CAC. They’ve also mastered platforms like TikTok Shop, where they became top-sellers, establishing themselves as trailblazers in the beverage sphere.

The result? An astounding 19x year-over-year growth, hitting $3 million per month in 2024 with a large chunk of this coming directly from subscriptions.

For brands considering DTC, the Brēz model stresses the importance of repeat customers. By driving subscriptions and retention, you create predictable cashflow and offset acquisition costs.

Strategy 3: Don’t just sell drinks – sell the experience

While DTC drinks can’t compete with the immediacy of a corner store purchase, they excel at one thing—selling a lifestyle.

Take Recess, for example. This brand doesn’t just peddle flavored mocktails; they sell the feeling of being “cool, calm, and collected” in a can.

By positioning themselves as the “Red Bull of Relaxation,” Recess has effectively tapped into the sober-curious consumer wave and an audience eager for functional beverages.

The key is getting your messaging right. Recess targets their ideal buyer with precision, ensuring their ads resonate deeply with audience values and aspirations.

The crux is that if your ads get more engagement with good targeting and messaging, the overall efficiency in ad spend will be greatly improved.

It will also be generally cheaper to get the ad in front of people, because it will start to be pushed by the ad platform as it's recognised as a "good ad".

By effectively selling the experience behind the product, you transform what could be a commodity into an emotional connection that commands attention (and sales).

How to sell drinks online: The big picture for DTC beverage brands

Success in the DTC beverage market boils down to three core strategies:

1. Drive down your costs with standout creativity:

Whether it’s humor, shock value, or emotional storytelling, creativity creates stronger brand awareness and lower ad spend.

2. Focus relentlessly on lifetime value:

Subscriptions, strong email retention plans and user connections make your margins sustainable in the long term.

3. Sell experiences, not just beverages:

Forge an emotional bond by showing how your product enhances lifestyles and aspirations. The challenge of selling in this space is undeniable, but as these brands have shown, building a thriving DTC beverage company with exponential growth is far from impossible.

By prioritizing innovation and strategy, you can carve your niche in the market and build a lasting connection with your customers.

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