Wednesday, September 22, 2010

Budweiser Losing Sales and Image Sinking


"With its brand sales sinking and its image losing ground, Budweiser is launching a new marketing campaign to freshen its image that involves pushing free beer and a more up-to-date Bud image to younger beer drinkers, according to a report in USA Today.
In order to appeal to the prime under-30 beer consumer group that has ignored the Budweiser brand, starting Monday the brewer plans to launch its biggest-ever national free-sample effort in bars and restaurants under the slogan “Grab some Buds,” the newspaper reports. The beer giveaways will culminate on Sept. 29, when Budweiser will host the “Budweiser National Happy Hour.”
Unit sales of Budweiser are down 9 percent this year and fell by the same amount last year, the paper reported, citing data from the Beverage Marketing Corp.
Beer drinkers have lost loyalty to Bud over the past seven years, according to the article. Upscale consumers have turned to craft beers, while price-conscious shoppers have traded down, and others have switched to light beers, USA Today said.
© 2010"

This reminds me of a discussion some motorcycle friends and I are having about Harley.  While Harley has immediate brand recognition, and are woven into the cultural fabric of America, as well as Budweiser, it seems that both have ignored the key younger demographics that will keep their brands relative as their core consumers age.

Let's face it.  Alcohol and motorcycles are not something everybody can continue enjoying after a certain age.  Though I don't profess to know the strategies behind Anheuser-Busch's marketing teams, it has seemed to this humble writer that they didn't have a plan.  Hubris ruled.  They were the biggest baddest cat in the jungle, pretty much synonymous with "beer".  Being that, they didn't have to exert much effort to maintain brand loyalty.

As the nineties deepened into the new millennium, craft breweries started taking a foothold, and consumers have been given choices.  Faced with those choices, consumers are voting with their wallets, and those opting for craft beer are eroding the stranglehold the big breweries have had on the markets.  In my opinion, this could have been reversed by spotting the trend earlier, and either bolstering the flagship brand by reworking the recipe to be close to the original, or developing other new and exciting flavors under the parental umbrella.  It can be argued that American Ale, BL Wheat, and BL Lime fit that bill.  It is true, but, it is a little to little, a little too late.  The ship had already sailed, and now they are scrambling to catch up.

I'll be so bold to make a prediction and you'll read it here first.  My prediction is that InBev and the Budweiser team start to tweak the formula for Budweiser in a bid to gain back some market share.  If they do, only time will tell if the experiment will be a home run, or a New Coke.

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