Bud Light Gets More Bad News as Modelo’s Sales Soar

Jack Phillips
By Jack Phillips
August 22, 2023Business News
Bud Light Gets More Bad News as Modelo’s Sales Soar
Bud Light, made by Anheuser-Busch, sits on a store shelf in Miami, Fla., on July 27, 2023. (Joe Raedle/Getty Images)

Modelo Especial is now the top-selling beer in the United States, surpassing Bud Light, whose popularity has plummeted in the midst of a lengthy boycott.

Data from Nielsen IQ shows Modelo Especial’s sales at beer and grocery stores surpassed Bud Light’s for the entire year, according  to CNN. Modelo got 8.34 percent share of dollars spent on beer, as compared to 8.28 percent for Bud Light from the start of 2023 to Aug. 12.

“The fact that we became the number-one beer in America due to a competitor’s moves is not accurate,” Jim Sabia, executive vice president and managing director of Constellation Brands, said in a recent statement.

“We’ve planned on becoming the number-one beer in America over the next couple of years; it just happened quicker than we anticipated,” he said. The executive had forecast that Modelo would be the top-selling beer by 2025, but the Bud Light boycott hastened the process.

Bud Light, which is owned by Anheuser-Busch InBev, has been the number-one-selling beer in the United States for about 20 years. In recent weeks, according to the data, Bud Light’s volumes have been down 26.7 percent, which is a slight improvement over the 30 percent drop the company has seen since the spring.

And Modelo’s rise in sales ““seemed inevitable for at least the last several months, but the timeline accelerated since Bud Light’s trends dramatically worsened in April,” Benj Steinman, of Beer Marketer’s Insights, told CNN. “And it happened far faster than most people expected.”

Molson Coors, which brews both Miller Lite and Coors Light, also saw significant sales increases in recent months. According to the report, Coors Light’s and Miller Lite’s combined sales were 50 percent higher than Bud Light in the second quarter and 30 percent higher than Modelo Especial.

It all started in early April when Bud Light made marketing promotional materials for transgender activist Dylan Mulvaney before the influencer posted a personalized beer can on social media. Conservatives were quick to call for boycotts, with musician Kid Rock using cans of the beer for target practice, and analysts suggested the move alienated Bud Light’s core consumer base.

Florida Gov. Ron DeSantis weighted in and called on the state’s  pension fund manager to take legal action against Anheuser-Busch for its alleged “failure to remediate the problem and repair its relationship with millions of disaffected American consumers,” which will “financially harm the [State Board of Administration] and other shareholders.”

Modelo Especial
Cans of Modelo Especial beer at a supermarket in New York on June 14, 2023. (Peter Morgan/AP Photo)

The governor suggested Anheuser-Busch breached its duties to shareholders by making promotional materials for the activist. In response, the beer giant said that “Anheuser-Busch InBev takes our responsibility to our shareholders, employees, distributors, and customers seriously.”

In the days after the controversy erupted, Anheuser-Busch InBev executives attempted to distance themselves from the marketing fiasco, with the company’s CEO, Michel Doukeris, declaring that just “one can” was made. There was also no official partnership, he added.

Anheuser-Busch stated in early August that its U.S. revenue dropped 10 percent in the second quarter due to Bud Light’s sales decrease. Revenue dropped $395 million in North America year over year, it said.

The firm added that it worked with a third-party researcher since the controversy erupted and engaged with about 170,000 customers across the country. It found that “most consumers surveyed are favorable toward the Bud Light brand and approximately 80 percent are favorable or neutral.”

Consumers “want to enjoy their beer without a debate. Two, they want Bud Light to focus on beer. Three, they want Bud Light to concentrate on the platforms that all consumers love,” Mr. Doukeris said earlier this month in a call.

The company, however, has seen its profits rise about 7.2 percent worldwide in the second quarter. That was, in part, due to a stronger performance inside China.

Days later, Anheuser-Busch said it is selling eight craft beer brands to Tilray Brands: Shock Top, Breckenridge Brewery, Blue Point Brewing Company, 10 Barrel Brewing Company, Redhook Brewery, Widmer Brothers Brewing, Square Mile Cider Company, and Hiball Energy.

In July, Anheuser-Busch confirmed it would be laying off hundreds of mostly corporate employees and restructuring its organization. Frontline workers like brewery operators and drivers wouldn’t be affected, it said.

The statement did not say whether the layoffs will impact Bud Light’s corporate division. But the new job eliminations will signify “less than 2 percent” of Anheuser-Busch’s staff in the United States, according to the company. Reports indicated that about 380 employees would be terminated of the company’s some 19,000 U.S. workforce.

“Today we took the very difficult but necessary decision to eliminate a number of positions across our corporate organization,” Anheuser-Busch CEO Brendan Whitworth said in late July. “While we never take these decisions lightly, we want to ensure that our organization continues to be set for future long-term success.”

The Epoch Times has contacted Anheuser-Busch InBev for comment on Tuesday.

From The Epoch Times

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