Bud Light market share stabilizes after transgender saga
Bud Light market share stabilizes after transgender saga
Anheuser-Busch Inbev Sees Decline in U.S. Revenue After Controversial Bud Light Campaign
Anheuser-Busch InBev, the multinational brewing company, has reported a 10.5% decrease in U.S. revenue during the second quarter. The decline can be attributed to a conservative backlash following a controversial marketing campaign by their flagship brand, Bud Light. The beer’s sales plummeted after the brand sent a commemorative can to transgender influencer Dylan Mulvaney in early April.
The company revealed that its total U.S. market share for all brands dropped over 5% to 36.9% in April. However, it stabilized from the end of April through the end of June. While Bud Light struggled, other brands such as Busch Lite and Michelob Ultra managed to gain market share.
The Bud Light saga has proven to be costly for Anheuser-Busch InBev. After over two decades of being America’s best-selling beer, it slipped into second place behind Mexican lager Modelo Especial in June. It is worth noting that InBev also owns Modelo, but in the U.S., the brand is imported and sold by Constellation Brands.
The downward trend continued for Bud Light, with its U.S. retail sales dropping 26% in the month ending July 22 compared to the same period last year. According to Nielsen data compiled by Bump Williams Consulting, the brand experienced year-over-year sales declines ranging from 25% to 30% every month since the backlash began.
Despite these challenges, InBev CEO Michel Doukeris remains optimistic and affirmed the company’s commitment to restoring Bud Light’s market position. Internal polling conducted by the company shows that 80% of U.S. consumers either have a favorable or neutral perception of the brand. Doukeris emphasized that consumers want to enjoy their beer without being dragged into debates, urging Bud Light to refocus on its core product and beloved platforms like the NFL and music.
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To compensate for the lost Bud Light sales, the company plans to provide financial support to U.S. wholesalers until the end of December. However, some investors expressed concerns about the company’s discounts on Bud Light, pointing out that they could negatively impact profitability. Doukeris defended the discounts, stating that recent price increases have put the company in a better position to offer them. He also mentioned that the summer marketing campaigns were planned prior to the Bud Light controversy.
The Bud Light campaign drew attention from both conservative figures calling for a boycott and supporters of Dylan Mulvaney, who criticized the brand for its lack of support. Mulvaney, the transgender influencer who received the commemorative can, claimed to have faced bullying and transphobia during the ordeal and expected more from Bud Light in terms of backing her. Surprisingly, Doukeris didn’t mention Mulvaney by name during the earnings call.
Anheuser-Busch InBev’s overall revenue experienced a 7.2% increase in the second quarter, reaching $15.1 billion. The growth was driven by global brands such as Stella Artois and Corona, which compensated for the decline in Bud Light sales. Despite the rise, the figure fell short of the $15.4 billion expectation from Wall Street analysts polled by FactSet.
In morning trading in New York, Anheuser-Busch InBev’s shares remained flat. The company faces the challenge of revitalizing Bud Light’s position in the market while also maintaining the growth of its other global brands. With financial support for wholesalers and a renewed focus on consumer preferences, Anheuser-Busch InBev aims to regain lost ground and satisfy beer enthusiasts across the country.
