They threw the Hail Mary during the 2006
Super Bowl, and it turned the game around. The Patriots? No.
Actually, it was the Brewers. The Brewers? Wait. Wrong sport.
But the right ad.
It’s been two years since Anheuser-Busch decided to
go long in its role as the domestic beer industry leader, trying to
rally the brew team from behind in the
polls by footing the bill for an
umbrella campaign to raise the profi le of all things beer. The offensive, called “Here’s to Beer,” arrived in the wake of a widely-reported poll that showed wine to be the alcoholic beverage of choice among Americans in 2005.
Here’s to Beer started in February, 2006 with an
ad that featured beer-centered toasts in dozens of languages and ended with a reference to a Web site, www.Herestobeer.com.
Anheuser- Busch fronted the money for
the push after its competition
refused to ante up.
“On initial launch, Here’s to Beer was endorsed by the Beer Institute, but it was paid for
by Bud,” says Bob Lachky, the
Executive Vice President of Global
Industry Development for Anheuser-Busch.
“There were some comments thrown back
that we were trying to just drum up more
sales. Well, you’re darn right we’re trying to build business. If we grow the pie, everybody’s slice gets bigger.”
Since that time, with Anheuser-Busch providing
the bulk up front and a deep lineup of craft beers at the skill positions, the beer industry has staged a comeback. The same Gallup Poll that put beer on the defensive has shown it, once again, to be the most popular alcoholic refreshment in the country for the past two years.
“The gap of growth between beer and wine and spirits is slowing down,” says Roman Shuster, an analyst with the consumer insight fi rm Euromonitor. “Beer is retaking share.”
Nevertheless,
the story of domestic beer is still
evolving. As if refl ecting the multinational approach to beer appreciation as
shown in that kickoff commercial, it
was, initially, a growing collection
of imports that was the big story; in
2007, it was crafts and microbrews: the big houses, particularly A-B, had not yet gained momentum. Sure, beer edged out wine in 2006, but it did so astride the shoulders of the growing importance of products like Heineken, Heineken Light and Corona.
Last year, the story was all craft. The tiny – less than 5 percent – but potent taste leaders continued to lead the buzz among retailers, with sales in that segment growing to nearly $700 million, all told, according to the Wall Street
Journal. Three-quarters of those sales benefi ted independent brewers
(the largest is the Boston Beer Co.) while 25 percent were big-three owned brands like Blue Moon and Red Hook.
Even as interest in mainstream
imports declined (that segment
slowed considerably in 2007), crafts
continued to grow.
This year, with a weakened dollar infl ating wine prices and a recession making the martini something of an anachronism, it could be time for consumers to dig into the meat of the domestic category. Big brewers are aiming advertising dollars at sprucing up the image of premium brands, with the intent of luring consumers downstream, using tributaries of craft beer to build the share of Bud and Miller.
“We are focused on our core,” says Lachkey. “Because of the nature of our size, it’s crucial
for Bud and Bud Light to be growing
for our wholesalers to be selling the extensions. We don’t want them to get distracted be getting too many ideas out there. The volume potential is moderate compared to Bud and Bud Light.”
The diversity of craft brewing has been great, Shuster acknowledges, but if the category is to continue to grow, “the credit really should go to Bud, Miller and Coors for stepping up
their advertising for their core
brands. Prior to 05 and 06, domestic
beers really looked all alike to the consumer,”
says Shuster, of the consumer insight firm
Euromonitor. “And you had Heineken really
promoting itself as a chic European brand, Corona on the beach, and the
domestic brewers saw that. So the
domestic brewers had to really figure out how to fi nd their market again.”
Differentiating between Miller, Bud and Coors, he says “really gives consumers the opportunity to identify with the brand. From 2001 to 2005, beer just wasn’t exciting enough. The brewers fought back and reformulated the way they
brought the product to market.”
But the battle back pitches these brands not with a follow-the-pack mentality, but as something that uses craft beers’ popularity as a springboard. The big brewers are emphasizing their expertise and care. Coors – whose fl agship
brand showed real growth last year –
has a new Web site focusing on its
heritage; Budweiser is now touted as
the “Great American Lager.”
Certainly,
the big brewers have broadened their
portfolios to include offerings like regional specialty brews like Bud’s Devil’s Hop Yard IPA,
traditional offerings like Miller-owned Leinenkugel’s, and
fast-growing styles like the wheat
beer exemplifi ed by Blue Moon. Even the light side – typically the best selling part of the big houses’ portfolios – is getting a new sheen: Miller is expanding its light beer portfolio to include high-end styles like White and Amber, while Bud continues to market its Select line as a high-end product.
Nevertheless, the big brewers’ real push isn’t from sub-brands, which together comprise perhaps one percent of the total domestic beer market. It’s in premium brands like Budweiser,
Miller Genuine Draft and Coors Banquet. Michelob will also get the focused advertising treatment, playing on its long tradition as a higher- end product.
The big
brewers are giving the impression of
optimism. So who is to thank for this turnaround? Is it just the sparking of
interest in beer via a Super Bowl
commercial and a marketing web site?
In assessing the revival of the category, the credit doesn’t belong to Here’s to Beer alone, Lachkey admits, but also the re-activation of beer as a high-end product.
“Clearly, I think the craft phenomenon has been
fantastic,” he says. “They’ve been working at it for so long, minus the hiccup in the mid- 90s, and the craft brewers really led the way in bringing new drinkers to the category.”