The debate over direct-to-consumer (DTC) shipping is heating up. The opponents of DTC shipping believe that DTC access should not expand, because it will lead to increased access for minors obtaining alcohol.
They point to findings from Massachusetts where 96% of DTC licensees investigated accepted DTC orders from a 15 year-old, and despite 98% of all shipments being labeled as alcohol, 26% of the shipments were left at the door, 43% did not obtain adult signature, and zero age verified the recipient of the package.
On the other end is the VinoShipper study, which examined the website’s registered buyers over a 3-year period. There were 633,985 registered buyers over a three-year period (Q1 2020 through Q4 2022), during that period only 943 of the buyers attempted purchases as a minor. In percentage terms this amounted to .15% of all purchases.
VinoShipper utilizes IDology, which is a system that age verifies utilizing public records.
Who is right?
With one study showing there is a great threat to public safety based on minors purchasing alcohol and another study indicating that minors are not utilizing the internet marketplace to access alcohol, who is right?
The answer lies within the details of the study.
Massachusetts performed a simulated exercise that had a minor taking an action, which the VinoShipper study demonstrates does not reflect real life. The dangers to DTC exist if minors have a great propensity to utilize the marketplace at a high frequency. With minors according to the VinoShipper study accessing the marketplace at .15% frequency, there is not a high propensity for minors to access the marketplace.
Further, we don’t know how many times the Massachusetts study was run, but I am sure it will not reach 633K data points like the VinoShipper study.
I know from personal experience that when Massachusetts runs a simulated exercise with a minor or someone impersonating the buyer, it will not pass muster with IDology. The only way the purchaser will be approved is by providing IDology the purchaser’s correct name and address and the purchaser being of age. Only then will the purchase order be approved. So, if a 15 year old inputted their proper name and address, they would be rejected by IDology, if they input a fake name and address, IDology would not accept their order either.
One last note, IDology blocked 100% of the sales to minors.
So, the debate on whether increased DTC shipping will lead to increased alcohol access to minors, comes down to whether in real life minors are accessing the marketplace. Clearly the answer is no!
Massachusetts indicated that 98% of all shipments were labeled alcohol, 26% of all shipments were left by the common carrier driver, 43% did not obtain adult signature, and zero drivers age verified the recipient upon delivery.
The state makes the admittance that basically all the sellers identified the product as alcohol. What is left out of this first number is whether it says alcohol or whether it says more, such as requires adult signature upon delivery. This is a key factor because many product shippers pay for adult signature. If the label says more than just alcohol on it, then the sellers are taking extra precautions.
The other stats relate to the common carrier’s duties, which they are paid extra to perform.
If the common carrier does not perform these duties, then the state should sanction them into compliance.
But again, this issue comes down to whether proper safeguards and the proper handling of alcohol are exercised. It does not demonstrate conclusively whether the common carrier failures in this simulated exercise, led to enhanced underage access to alcohol.
Nevertheless, the common carrier representatives lack of diligence is disturbing and needs addressing.
As someone that worked on issues with Chief Ted Mahony from the private sector side, I have nothing but respect for him. He is an honest and hardworking public servant. I also commend him sitting down with common carriers and addressing this issue.
He truly cares about underage access and wants to do his best to eliminate it in the marketplace. And for that, I think he is doing a great public service.
However, I must respectfully side with the VinoShipper study, as it is more thorough and reflects what occurs in real life. In real life, the situation of the 15 year old purchasing, is not happening at a high propensity.
Additionally, IDology blocked the sale to minors 100% of the time.
If the goal is 100% success, then states should require IDology or some age verification software. In that way, we can guarantee consumer access to a greater marketplace and at the same time guarantee 100% accuracy that product is sold to someone over 21.
As for package delivery, we need to hold the common carrier accountable for any actions that could lead to underage access to alcohol. Sanction them into 100% compliance.
The goal should be increased choice for consumers and enhanced marketplaces for sellers.
Unfortunately there are industry members that want to choke off both ideals and use half excuses to preserve a status quo that does not work for businesses or consumers.
But what these studies show is with some legal changes and fixes, consumers and business can have the marketplace they desire, and not the marketplace others want for them!
Are we bored with the excuses yet, it’s time for reform!