Conversational AI Stirs Up Spirit Sector’s Digital Transformation

You can order almost anything online, so why should booze be any different?

That’s the $285 billion question Drinks is keen on answering, Barry Collier, the company’s co-founder and head of R&D, said during a discussion for the PYMNTS series “When Chatbots Go Shopping: How GenAI Is Shaking Up the Retail Status Quo.”

Two key challenges to solve when operating across the U.S. alcohol market are streamlining fragmented liquor regulations and driving personalization as a competitive moat, he said.

Enter artificial intelligence.

Drink has been using AI for nearly a decade, a journey that began with a patent in 2016 for a wine label affinity system. The system was designed to understand why consumers choose certain wines, a decision often influenced by the label rather than the contents of the bottle.

“Upwards of 85% of the purchase decision for wine is based on the label,” Collier said.

Recognizing this, Drinks employed computer vision and machine learning to analyze label features such as colors, fonts and imagery, determining how these elements might resonate with consumers.

This approach mirrors strategies seen in other industries. Collier pointed to Netflix, which tailors its thumbnails based on user preferences.

“If I like action films, the thumbnail will highlight action scenes,” he said.

Drinks applied this principle to wine, optimizing visual cues to capture attention in the competitive online space while simultaneously working to ensure marketplace compliance for every sale in one of the most tightly controlled industries.

Building for the Future by Using Next-Gen Technologies

Drinks didn’t start as a software-as-a-service (SaaS) platform for the liquor and beverages space. Initially a direct-to-consumer (D2C) wine business, the company pivoted in 2015 after recognizing the broader demand for its compliance and sales infrastructure.

“We realized we could build something akin to [Amazon Web Services (AWS)] for the alcohol industry,” Collier said, referencing Amazon’s scalable cloud platform and noting that operating a D2C business as a first act was key to helping Drinks identify pain points and develop solutions that resonate across the industry.

Drinks’ flagship offering, Drinks as a Service (DaaS), is a multi-faceted platform designed to turn the historically fragmented alcohol industry into a well-oiled, compliance-savvy machine.

The platform’s dual marketplace model connects alcohol producers with non-traditional sellers like social media influencers, Collier said. This integration allows influencers to market alcohol products compliantly, broadening market reach while maintaining regulatory rigor.

The Drinks Assure function ensures every sale meets stringent state and federal alcohol laws. From flagging volume limits to adjusting product availability based on local regulations, AI acts as a guide and watchdog.

“Compliance isn’t just a necessity; it’s a service,” Collier said, highlighting its role in enabling seamless operations for producers and retailers.

At the same time, AI-driven recommendations help customers discover products tailored to their preferences. Whether it’s suggesting a cabernet for a dinner party or a rare whiskey for collectors, the platform uses data to create a bespoke shopping experience.

Conversational Commerce: Chat as the New UI

One of the most exciting frontiers for Drinks is conversational commerce, Collier said. Generative AI and large language models have revolutionized chatbots, elevating them from gesture-based interactions to dynamic, intent-driven conversations.

“Chat is the new UI,” he said, explaining that this shift enables retailers to capture nuanced customer preferences.

Drinks’ Virtual Sommelier exemplifies this innovation. The application uses AI to guide customers through their wine selections, responding dynamically to informational and product-specific queries. Collier said he envisions a future where such systems evolve into personalized shopping agents that understand and anticipate individual preferences, creating a “universe of one” for each customer.

Looking to the future, Collier said he anticipates rapid advancements in AI capabilities, particularly in personalized and proactive commerce. He predicted a shift toward “personalized shopping agents” that seamlessly integrate with platforms like Amazon and Shopify.

“The technology is expanding exponentially,” he said, noting that advancements in AI models have outpaced benchmarks.

Drinks aims to stay at the forefront of this evolution, using generative AI to create personalized customer experiences, Collier said. Whether through virtual sommeliers or dynamic chatbots, the goal remains to make the shopping journey intuitive, engaging and efficient.

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