Hi beer fans, happy Friday! Come in and enjoy a cold one with us!
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It’s been a little over a year since Bud Light made its ill-fated marketing deal with social media influencer Dylan Mulvaney. I covered this in FNBB on April 14, April 21, and May 19, and I’ve still never seen an answer to my question from that last story:
one thing no story has mentioned is how much, if anything, AB paid Mulvaney. They sent her product which she put into a “sponsored video” on Instagram. Are they continuing to pay for that sponsorship? They seem to have bought millions in bad publicity with maybe thousands of actual cash.
I’ve been intending to do a follow-up for a while now, and luckily Yahoo Finance has pulled all the numbers together for me.
On Thursday, Bud Light parent company Anheuser-Busch InBev (BUD) posted better-than-expected Q1 results a year after an advertising campaign kicked off a boycott starting April 2023. Yet, Constellation Brands (STZ) and Molson Coors (TAP) have been fighting to hold on to their gains from Bud's losses while looking for more room to grow.
Revenue for Anheuser-Busch jumped 2.6% to $14.55 billion from higher prices, but volume sold dropped 0.6%, though it was less than Wall Street anticipated. The largest decline came from North America, where volume dropped 9.9%, largely due to sales of Bud Light...
Over the last four-week period, Bud Light sales are down 27.1% from a year ago, whereas Miller Lite is up 7.8% and Coors Light grew 15.3%, according to data from Bump Williams Consulting. [CFRA analyst Garrett] Nelson called Molson Coors the "primary beneficiary of the fallout."
Williams isn't convinced that Molson Coors capitalized on the fallout as much as it could have. "Miller Coors just squandered the biggest opportunity they've ever had in their life. They didn't win anything. They simply got the leftovers from the Bud Light debacle," Williams said. "They didn't do anything to earn that; they just simply fulfilled orders."
Constellation Brands is the "massive winner," per Williams. "Everything they have in the marketplace is growing — everything," he commented.
Last June, Modelo overtook Bud Light as the No. 1 beer in the US. It gained market share from Bud Light's boycott but also benefited from the growing popularity of imported beers. "Constellation Brands being the big play on imports, with Modelo, Corona, Pacifico. Imports have taken market share from domestic brands for a long time ... the Bud Light boycott helped accelerate that," said Nelson. Constellation's beer volumes jumped 8.9% year over year in the latest quarter while sales jumped 11%, both beating Wall Street estimates.
Summarizing:
The boycott hurt the Bud Light brand a lot, it hurt AB InBev a little, and like most other brewers in a year where beer sales generally declined, they made up for lost volume by raising prices.
Also, by the standards of industrial lager, Modelo Especial is IMO pretty good.
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I need to go beer shopping at Total Wine soon, I have some Hazy Little Thing in the fridge and that’s all.
What are you drinking? Anyone brewing?