AB InBev earnings beat expectations, Bud Light debacle shrugged off

The world’s largest brewery finally has another reason to make headlines besides Bud Light’s marketing blunder: stellar profits.

Belgium’s Anheuser-Busch InBev announced core earnings of $4.76 billion, an increase of 13.6% over the first quarter of 2022. first quarter earnings Today (May 4th). company attributed The explosive rise – Wall Street was expecting a a jump of about 5.6%—to Pricing Actions and Product Premiums. In other words, customers digested the price hikes, and many opted for higher-end products this quarter.

Announcing better-than-expected results, AB InBev didn’t address the Bud Light controversy or its ramifications — likely because it’s all happened then The quarter ended March 31, and its impact will not be seen in these results. analyst, though, is reading Between the lines to say The company is being careful. For example, it could have raised its guidance on the back of a strong first quarter, but the conservative US backlash against social media promotion may have prevented the company from doing so.

Later, on the earnings call, CEO Michel Docres told investors “It’s too early to get a full viewto the impact of the situation on sales. Bud Light drops in volume in the U.Ss The first three weeks of April, as reported publicly, will represent about 1% of our total global volumes for that period.

Bud Light’s campaign for inclusivity has gone terribly wrong

The backlash against transgender rights has raised various issues in the United States, from Children and drag shows to save Gender-affirming health care to Participation of trans athletes in sporting events. Then he came for a beer. Bud Light’s campaign with transgender influencer Dylan Mulvaney — the brewer sent her a custom can to celebrate the 365 days since her transition — has become a lightning rod in the political storm.

Mulvaney April 2 on Instagram It didn’t sit well with the company’s conservative, traditional beer drinkers. Supporters of Carrie Lake, the failed 2022 Republican nominee backed by Donald Trump for governor of Arizona, Refusal to drink Bud Lite for free At an open bar at a rally in Iowa. A Kentucky restaurant owner said the divisive ad was to blame Bar fight Exit. A Florida restaurant chain has suspended beer from its menu for violating “Biblical faith. Florida Governor Ron DeSantis took a break from Disney runner To say iPod lite Lost it as a customer. Musician Kid Rock made a video of himself Shooting a bunch of Bud Light cans.

Since then, beer sales have reportedly gone up I backed offand wholesalers received personal threats due to the backlash from the promotion.

To make matters worse, the Bud Light factory failed to support his and Mulvaney’s campaign. On April 14, CEO Brendan Whitworth, without addressing the controversy directly, he said in a statement that the beer brand “was never intended to be part of a discussion that would divide people. We’re in the business of bringing people together for a beer.” The statement failed to quell the controversy, but managed to attract criticism from the LGBTQ community that the ad was trying to reach. Whitworth’s response was weak and little in hindsight, According to LGBTQ activists.

One big number: Bud Light sales are plummeting

26.1%: How Much Bud Light Sales Decreased in the Week Ending April 22nd, Compared to the Same Time a Year Ago, According to Figures from Trade Newsletter Bear Business Daily, cited by Barrons. Meanwhile, rival beer brands Miller Lite and Coors Light are Noting an increase in sales.

Subject: Alissa Heinerscheid

Alisa Heinsreid, Vice President of Marketing at Anheuser-Busch who oversaw the promotion of the partnership with Mulvaney, Leave of absenceWith its president, Daniel Blake. Todd Allen, global vice president of Budweiser, is Steps inside.

in Podcast interview Released before the controversy, Heinerscheid explained that her brief was to bring Bud Light to a new customer base: “I had a really clear job to do when I took over Bud Light. A state of decline for a really long time, and if we don’t attract young drinkers to come and drink this brand, there will be no future for Bud Light.”

Citable: Which side of history will Bud Lite be?

“In terms of marketing, I hope and believe that they realize that as a brand they will become extinct in a few years if they are not completely on the side of equality, because that is what the Gen Z consumer expects and demands.” —Stacy Lentz, co-owner of the Stonewall Inn, who boycotted a Bud Light during New York Pride to protest Anheuser-Busch’s donations to Republican politicians who supported anti-LGBTQ+ legislation.

AB InBev’s beer sales in numbers

25%: The share of all globally brewed beers produced by AB InBev, which makes Budweiser, Stella Artois and Corona among other brands

0.4%: The company’s beer sales were faster in the first quarter of 2023, compared to last year. China finally emerging from Covid-19 lockdowns played a significant role given lower volumes in all other regions.

19.4%: Shipment volumes of US beer to wholesalers decreased between December 2020 and December 2022, according to Wells Fargo. Especially light beer loses to the beer industryand other alcoholic beverages such as wine and spirits. Bud Light may be recovering from the controversy surrounding social media marketing, but it’s reversing years of erosion It will be harder.

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This post has been updated with comments by Michelle Docris.