If you’ve ever wondered why massive, international beer behemoths like AB InBev, which is already home to Budweiser and dozens of others, keep gobbling up small craft brewers? Because more Americans are sneering at mass-produced lagers and seeking out local and craft brews instead. As a country, we’re still drinking plenty of beer; we’re just not drinking Bud.If you’ve ever wondered why massive, international beer behemoths like AB InBev, which is already home to Budweiser and dozens of others, keep gobbling up small craft brewers? Because more…
“The underlying business remains incredibly weak,” one industry analyst told Bloomberg News.
AB InBev considers Budweiser a “premium” brand within its portfolio, compared to lower-prestige brands like Busch. While the brands’ marketing campaigns are successful in that people are paying attention to them, actual sales of the beer aren’t increasing.
“Budweiser’s ‘American Summer’ campaign and the return of the ‘America’ packaging contributed to upward trends in brand health and led to Budweiser becoming the leading brand in the industry in ad awareness and consideration growth in 3Q17,” the company wrote about its American business in its quarterly earnings report [PDF].
What’s conspicuously missing there is any sales increase in exchange for all of that marketing — because the market shares for Budweiser and Bud Lite are falling. The company also blamed some poor sales performance on hurricanes in Florida and in Texas that presumably disrupted residents’ beer drinking briefly, but temporary disasters aren’t the issue. Customers’ distaste for Budweiser is.
Budweiser is hoping for a sales boost from a limited-edition release of a pre-Prohibition recipe later this year, and is investing $2 billion in trying to increase sales. Customers are already aware of the brand: Have they just rejected the beer itself?
Maybe the craft brewers who are trying to raise a few hundred billion through crowdfunding to buy AB InBev will have some fresh marketing and product ideas. The campaign has already received nearly $3 million in pledges — only $212.997 billion to go!