Anheuser Busch (BUD) revealed a plan Thursday night to support its struggling Bud Light brand. The brand’s sales have plummeted in the past two months as Tory boycotts erupted after the Bud Light ad featuring transgender influencer Dylan Mulvaney on April 1.
“We recognize that over the past two months the conversation around our business and Bud Light has shifted away from beer and this has impacted our consumers, business partners and employees,” wrote the Anheuser-Busch CEO Brendan Whitworth in a note Thursday. . “To all of our valued customers, we hear you. Our summer ad will launch next week and you can expect Bud Light to reinforce what you’ve always loved about our brand: that it’s easy to drink and easy to drink. enjoy.”
Whitworth announced that Anheuser-Busch will invest in protecting the jobs of frontline workers, as well as financial support for its wholesale and distributor partners. Anheuser-Busch will assess the impact on individual wholesalers and provide sales incentive payments for beer sold through the end of the year. The company will also extend additional credit to wholesalers through the end of 2023 and reimburse them for freight and fuel surcharges. Anheuser-Busch also plans to increase brand investment in local markets.
“As we move forward, we’ll focus on what we do best – brewing great beer and earning our place in the moments that matter to you,” Whitworth wrote.
Whitworth also plans to listen to customer feedback during a trip to the United States this summer, as part of Budweiser’s MLB sponsorship, Axios reported.
Bud Light loses its title of best beer
Lager Modelo Especial overtook Bud Light in U.S. dollar retail sales for the month ending June 3, according to data from Nielsen and Bump Williams Consulting. Anheuser-Busch’s market capitalization plunged in May as Bud Light sales fell and the boycott persisted.
Modelo accounted for 8.4% of U.S. grocery, convenience and liquor store sales during the month. Bud Light sales fell 7.3%, The Wall Street Journal reported Wednesday. Meanwhile, retail sales of Bud Light in the United States fell 24% in the week ending June 3 compared to the same week last year, while sales of Modelo Especial jumped 12% , according to the WSJ.
Bud Light claimed the crown as America’s top-selling beer in 2001, but sales have plummeted in recent years as beers, seltzers, wines and spirits imported from Mexico have become more popular. Model is sold by Constellation Brands (STZ) in the United States But Anheuser-Busch’s subsidiary, Grupo Modelo, holds the international license for the brand.
Anheuser-Busch sold the brand to Constellation Brands in 2013 to gain regulatory approval for its acquisition of Grupo Modelo.
Mark Cuban addresses the Bud Light controversy
Billionaire entrepreneur Mark Cuban weighed in on the Bud Light controversy during an interview with the Post Gazette published June 11.
“There’s a reason almost all of the top 10 companies by market capitalization in the United States can be considered ‘woke’. It’s good business,” Cuban said. According to Cuban, people want to do business with companies that care about their customers, which is an American trait that reflects who we are as a country, the Post Gazette reported. “Most CEOs have enough experience to know that you just have to wait for the end of the news cycle until they move on to the next one,” Cuban said.
He also brushed off stock price losses as an indicator of boycott impacts. “First of all, a decline in market capitalization doesn’t make sense,” Cuban said. “You have to realize that there aren’t a lot of individual stock owners – almost all ownership is through funds, and most trading is quantitative. So it’s not like the drop is due to the fact that tens of thousands of individual holders sold their shares.”
BUD stock fell slightly on Friday and shares jumped 6% over the week. Anheuser-Busch shares fell 12.9% following the Bud Light ad with Dylan Mulvaney, down from a March 31 high of 67.09.
STZ stock rose around 2.5% during the week and fell slightly on Friday. STZ shares are trading just below the buy zone for a saucer-with-handle base after briefly breaking above the buy point of 248.43 on Thursday.
You can follow Harrison Miller for more stock info and updates on Twitter. @IBD_Harrison
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