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Bud Light’s Decline: From Top Seller to Number 3 in the U.S. Beer Market

Bud Light’s Decline: From Top Seller to Number 3 in the U.S. Beer Market

Bud Light’s Decline: From Top Seller to Number 3 in the U.S. Beer Market

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Edited by: TJVNews.com

Bud Light was once a dominant force in the American beer industry, but its decline has been dramatic. According to a report published Thursday in The Wall Street Journal, more than a year after a boycott rocked the beer market, recent sales figures reveal that Bud Light has slipped to third place, behind Modelo Especial and Michelob Ultra.

Bud Light now represents just 6.5% of beer dollar sales in U.S. stores, according to an analysis of NielsenIQ data by consulting firm Bump Williams. The WSJ reported that Michelob Ultra, by contrast, accounts for 7.3% of sales, with Modelo Especial leading the way at 9.7%. The shift marks a significant change in consumer preferences and market dynamics, with Modelo Especial, a Mexican import sold by Constellation Brands, consistently outperforming Bud Light since last year.

The period between Memorial Day and July 4 is particularly crucial for the beer industry, often determining a brewer’s annual success. As noted in the WSJ report, during this year’s crucial summer period, Modelo Especial not only surpassed Bud Light in dollar sales, but also surpassed it in sales volume. The milestone highlights Modelo’s growing popularity and Bud Light’s ongoing struggles.

The roots of Bud Light’s decline can be traced back to April 2023. The boycott began after a transgender influencer posted an Instagram video showing off a personalized can of Bud Light that the brand had sent to her as a gift, as revealed in the WSJ report. The video sparked outrage in conservative circles, leading to widespread calls for a boycott. By May 2023, Bud Light had lost its position as the best-selling beer in America, and the brand continued to face backlash throughout the year.

In a surprising turn of events, former President Donald Trump endorsed Bud Light in February. The show of support, however, did little to halt the brand’s decline. The WSJ report indicated that Bud Light sales continued to decline, exacerbated by U.S. retailers reducing the amount of shelf space allocated to the brand. This loss of visibility and accessibility has further hampered Bud Light’s ability to regain market share.

Bud Light’s fall from the top spot has had major ramifications for both the brand and the broader beer industry. The WSJ report suggested that the shift in consumer preferences highlights the volatile nature of the market and the potential for rapid changes in brand loyalty. For Bud Light, the challenge now lies in regaining consumer trust and rebuilding its market position.

While Bud Light, once Anheuser-Busch InBev’s crown jewel, has seen a significant decline, the brewing giant is far from defeated. Despite the former favorite falling to the No. 3 spot in the U.S. beer market, other brands in AB InBev’s portfolio, including Michelob Ultra and Busch Light, are experiencing notable growth, according to the WSJ report. These shifts highlight the company’s adaptive strategies in response to changing consumer preferences and market dynamics.

Michelob Ultra has become a huge success story for AB InBev, now ranking second in U.S. beer dollar sales. Its market share has grown to 7.3%, overtaking Bud Light. As noted in the WSJ report, this growth can be attributed to the brand’s effective positioning and marketing, which appeals to health-conscious consumers looking for a low-calorie, low-carb beer option.

AB InBev CEO Michel Doukeris acknowledged the challenges facing Bud Light, including losing 5% to 7.5% of its shelf space during the spring reset. The WSJ report also noted that retailers have adjusted their shelf allocations based on sales performance, with many reallocating space from Bud Light to other AB InBev brands. Michelob Ultra has benefited the most from this shift, gaining additional shelf space and increasing visibility to consumers.

Busch Light is also a bright spot for AB InBev, with sales up 12.8 percent in the four weeks ended July 6. The brand’s growing popularity is due in part to strategic marketing initiatives that have successfully tapped into a specific demographic. According to the WSJ report, Busch Light is focusing heavily on country music this summer, sponsoring performances at music festivals and state fairs across the United States. This sponsorship strategy not only increases brand visibility, but also aligns Busch Light with the cultural preferences of its target audience.

Despite the Bud Light setbacks, AB InBev is leveraging its diverse portfolio to maintain a strong presence in the U.S. beer market. According to the WSJ report, the company is creating in-store displays tied to high-profile marketing campaigns around major sporting events, such as the National Basketball Association (NBA), Copa América, the Paris Olympics and the National Football League (NFL). These campaigns are designed to make up for lost shelf space and drive consumer engagement across multiple touchpoints.

AB InBev’s marketing campaign this summer has a strong focus on sports sponsorship, specifically for Michelob Ultra. The brand sponsors both the U.S. and Mexico men’s teams at the Copa América and counts Argentine soccer star Lionel Messi among its ranks. Additionally, the WSJ reported that Michelob Ultra is sponsoring Team USA at the Paris Olympics, further reinforcing its association with athleticism and active lifestyles.

These sponsorships not only increase the brand’s visibility, but also align Michelob Ultra with global sporting events that resonate with its target audience. The brand’s association with leading athletes and teams reinforces its image as a beer for those who value fitness and performance.

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