Beer Business Daily publisher Harry Schuhmacher, a beer industry expert, says that Anheuser-Busch could have avoided the Bud Light boycott if it’d been more in touch with Middle America.
“A-B made a conscious decision back in 2015 to move their sales and marketing functions to New York from Saint Louis, where they had been headquartered for, you know, 100 years,” he said this week to Fox News.
“At the time, distributors warned them that might give them a hole in their thinking. It might give them gaps in connecting with Middle America. And sure enough, that clearly happened,” he added.
Sure enough indeed.
No light at the end of the tunnel for Bud Light, says fmr. Anheuser-Busch exec: ‘I see this continuing to drag on’ https://t.co/H69JaeZBFg pic.twitter.com/w4L7UeGSfV
— BizPac Review (@BIZPACReview) May 23, 2023
“I think living in that kind of Chelsea-Manhattan bubble really does remove you from the bars and taverns, restaurants and convenience stores, grocery stores across America. And I think it definitely does have a cultural effect that you can’t really measure, but it’s definitely there,” Schuhmacher continued.
“I don’t know what they can do now. It’s hard to move people back, but I think clearly that might have been a contributing factor, at least to what happened,” he said.
His remarks come months into a Bud Light boycott that has cost the brand oodles.
“The market value of Anheuser-Busch InBev, whose fourth bestselling brand is Bud Light, dropped $15.7 billion since April 1. … That’s the day Dylan Mulvaney, a TikTok influencer and transgender woman, pitched the Bud Light brand during the NCAA March Madness tournament,” Investor’s Business Daily reported in May.
Since then, it’s regained slight value, going from a low of $53.40 a share on May 31st to $57.11 on August 3rd. However, it’s still down dozens of points from a high of $66.39 recorded in late March.
“In my 30 years of doing this, I’ve never seen anything like it. I’ve never seen such a shift in market share this quickly, and I’ve never seen it so prolonged. And I think it’s kind of a wake-up call for marketers in all CPG [consumer packaged goods] that wading into the culture wars can have pretty serious consequences,” Schuhmacher said of the successful boycott.
“It’s probably best just to stay clear, unless you’re a brand that trades on that kind of controversy. Bud Light clearly does not. When you’re drinking beer, politics, religion, those sorts of things should be out the door. And they broke the first cardinal rule of beer brand marketing,” he added.
Meanwhile, things are now so bad at AB that last month it announced the layoff of hundreds of employees. Interestingly, however, the layoffs did not affect “brewery and warehouse staff, drivers and field sales, among others,” according to AB. Schuhmacher believes he knows why.
“There was clearly a need for a cultural shift within the company, especially in the sales and marketing departments in New York. We’ve been led to believe that’s where the majority, if not all of the layoffs have occurred, not at the street level, not in their regional offices just in New York,” he said.
Bud Light parent company Anheuser-Busch is preparing for another round of mass layoffs as they sink below Modelo for top-selling beer. The company is expected to cut roughly 380 employees.
Until May, Bud Light had been the top-selling beer in America for over 20 years. pic.twitter.com/seWCOH4Xrv
— Ben Swann (@BenSwann_) August 2, 2023
All this comes the same week that AB announced a severe drop in profits.
“The world’s largest brewer said Thursday that revenue in the United States declined by 10.5% in the April-to-June period from a year earlier, ‘primarily due to the volume decline of Bud Light,'” the Associated Press reported.
“It has lost its place as America’s best-selling beer after more than two decades, slipping into second place in June behind Mexican lager Modelo Especial, which is also owned by the Belgium-based ABInBev,” the AP added.
At this rate, Schuhmacher expects Modelo to soon become the number one beer in all of America “by any metric.”
“It’s been widely reported that Modelo Especial is the No. 1 beer. And that is true, but it’s only true in certain channels. And it’s only true when you’re counting dollars versus cases, because Modelo Especial is more expensive than Bud Light,” he said.
“Any increase is going to accrue more to Modelo Especial. So, yes, in the off-premise channels, many grocery stores and convenience stores, Modelo Especial is now the No. 1 beer both currently and increasingly year-to-date. So I think by the end of the year, Modelo Especial will likely be the No. 1 beer in America by any metric if these current trends continue, which they seem to be pretty locked in,” he added.
Writers and editors can be contacted at [email protected] with feedback, tips, or corrections.
V. Saxena is a staff writer with a decade of experience as a professional writer, and a lifetime of experience as an avid news junkie. He holds a degree in computer technology from Purdue University. Saxena also contributes to BizPac Review.
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