It can be difficult to gauge the impact of a marketing campaign, however, Anheuser-Busch’s latest ads featuring transgender influence Dylan Mulvaney appear to have had an impact on sales of its flagship Bud Light beer.
The brand’s controversial marketing collaboration, which sparked a fierce backlash on social media, apparently caused Bud Light store sales to drop 17%, according to industry research.
Bud Light’s partnership with Mulvaney, who has 10.8 million followers on TikTok, was aimed at appealing to a young and wide audience of drinkers. But it also got a lot of backlash because of the influencer’s gender identity. This led some beer fans to launch a boycott to show their displeasure with the marketing decision.
The boycott may have succeeded, based on recent data from NielsenIQ and Bump Williams Consulting cited by The Wall Street Journal. Sales at Bud Light stores fell 17% in the week ending April 15 compared to the same period last year. The newspaper also reports that two executives who oversaw the collaboration have been furloughed.
If the boycott continues, the brand’s position as the top-selling beer in the country could be threatened. Rivals are already stepping in and taking market share.
Here are some of the rival beer brands investors can bet on ahead of the summer peak season.
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Coors Light and Miller Light
Coors Light, the second most popular beer brand in America, appears to have taken market share from giant Bud Light. Data from NielsenIQ and Bump Williams Consulting published by The Wall Street Journal also revealed that Coors Light sales rose 17.6% in the week ending April 15.
Miller Lite saw its sales increase, also by 17.6%, in the same week compared to a year ago.
Both brands are owned by the same company: Molson Coors Beverage Co. The Colorado-based brewing giant is listed on the New York Stock Exchange under the symbol “TAP”. The stock has risen 14.94% over the past month as the Bud Light debacle unfolded.
Bud Light, Coors Light and Miller Lite dominate the light beer market. However, smaller brands like Michelob Ultra also seem to benefit from the Bud Light controversy. The brand saw its dollar volumes rise 0.4% in the week ending April 15, according to industry news source Brewbound. The market share of the super premium segment increased by 2.2% that same week.
Michelob Ultra, however, is owned by Anheuser-Busch. Some investors may see this as an opportunity to buy the beaten stock. Despite its recent decline, Anheuser-Busch Inbev (NYSE:BUD) stock is up 4.26% over the past month. It trades at just 22.55 times earnings per share and offers a dividend yield of 1.26%.
Only 28% of the company’s sales are generated in North America. This means he is better insulated from this controversy than most boycotters realize. This could be the perfect opportunity for a contrarian investor.
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This article provides information only and should not be construed as advice. It is provided without warranty of any kind.