ADV 275 Interim Report #2
Anheuser-Busch Inc is known for creating over 100 brands of domestic beer in
the United States. Despite all the other brands, Budweiser takes the lead of being the
most noticeable brand. Budweiser contributes to two-thirds of $18.988.70 million gross
sales in 2007. Also in 2007, Budweiser contributed to Anheuser-Busch’s market share
of 59.7%. $68,108.10 million was spent on advertising in 2007.
Brand Positioning is very important for Anheuser-Busch’s brands to stand out
compared to others. Budweiser uses the benefit position to label itself as “The Great
American Lager”. This position shows that other brands cannot label themselves as
“The Great American Lager”. Budweiser only can use this description. In 1876, “The
Great American Lager” was introduced as truly being American. It was unlike other
lagers introduced by German Immigrants. Budweiser’s American lager balances
bitterness with sweetness for superior quality. Image positioning of a crown above the
word “Budweiser” indicated that this brand is “The King of All Beers”. Just the simple
image of a crown makes people notice that if that want the best beer, choose
Budweiser, “The King of All Beers”. Below the word “Budweiser”, “The Great Ameican
Lager” is used to reassure that people will buy this brand if they want the best Ameican
When people choose a brand a beer, they have to relate to it. Budweiser can
attribute to its customers, by promoting its beer as being purely American. “From
wholesaling brewing supplies to becoming the iconic brand it is today, the product and
the company have been recognized in so many facets of daily life ranging from Politics
to Pop-Culture,” (“THE BUDWEISER STORY,” 2009). People who love to drink
American beer can relate to this aspect when picking the only beer which advertised
itself as “The Great American Lager”. Even though Anheuser-Busch merged with
Inbev., Budweiser still use the logo, “The Great American Lager”. Budweiser benefits its
customers by proving that its brand is high quality. Budweiser’s American lager is also
at an affordable price of around $6.99 for a 6 pack. When visiting budweiser.com, you
can browse through and see how the beer is made by clicking on the tab that says 10
Things To Know About Budweiser. There you’ll find out that Budweiser is made with
barley and rice. Crops are analyzed and picked by quality. Brew masters taste the beer
to see if there are any flaws. There is even a description of what “lager” is. These
descriptions of Budweiser add value to the customers’ perception of the brand, by giving
detail of how the beer is made to ensure its quality.
When brands compete, they have to use competitive differentiation. Since,
Budweiser says they are “The King of All Beers”; another brand has to prove that they
are wrong. Budweiser has the funny frog commercials that attract all audiences. If
Budweiser leads the best commercials compared to other brands, then customers will
be more likely to buy that product. Budweiser has to make sure that their commercials
differ from other brands and stand out more.
Budweiser promotes itself by being involved in a variety of different activities. In
2008, Budweiser sponsored the Olympics in Beijing, China. Budweiser is also involved
with helping out the great outdoors by helping out conservation. They led a campaign
called “Help Budweiser Help the Outdoors” program. “In the past eight years, the “Help
Budweiser Help the Outdoors” promotion has raised more than $7.5 million to conserve
vital habitat and wildlife across the country,” (“Program Has Raised More Than $8
Million in Past Eight Years,” 2009 ). Budweiser uses sponsorships to indirectly promote
itself to help out other organizations or people. Kasey Kahne is sponsored by Budweiser
to wear Budweiser attire and drive the Dodge Charger that also displays Budweiser
logos. On http://budweiser.com/index.aspx, photos of Kasey Kahne and the Dodge
Charger displays Budweiser, so Budweiser will be advertised at NASCAR events.
Budweiser does have strengths and weaknesses like any other brand. Some
strengths are Budweiser’s commercials, because they are advertised to target all
audiences. For instance, the super bowl advertisement every year is seen by millions of
people, because of how major the event was. Budweiser’s commercials do have
weaknesses too. On May 16, 1996, there was a press conference on Alcohol
Advertising Reforms. At the press conference, George A. Hacker, director of the
Alcohol Policies Project wrote about the press conference. “Budweiser's trio of
syllable frogs, who croak "Bud-Weis-Er" in various patterns until they form the brand's
name, provides a good example of a campaign that unscrupulously appeals to children”
(Hacker, 1996). The commercials were banned, because children were subconsciously
attracted to the alcohol messages the frogs displayed. “Overall, 81% of the children
surveyed identified beer as the product promoted by the frogs,” (Hacker, 1996).
Commercials aren’t the only negative impact on Budweiser. There is also a problem
with Inbev. joining Anheuser-Busch, because there are some people afraid that their
favorite beer will turn into Belgian beer. An article written by David Pauly for
Bloomberg.com, suggests problems that might result from joining Inbev. joining
Anheuser-Busch. “A bigger worry is that InBev cost-cutting might interfere with the
processing of Budweiser. What do these guys know about brewing beer? Heaven forbid
that Budweiser ends up tasting like InBev's Stella Artois or Beck's, which have the bitter
taste typical of European beers,” (Pauly, 2008). A positive aspect about this problem is
that are other people who think Budweiser will still be the top American Lager. “A
Budweiser beer bottled by InBev is still an American beer, the same as a Toyota made
in Kentucky is still a Japanese car,” (Ries, 2008). Based on people’s different views,
Budweiser will have its strengths and weaknesses.
Hacker, George A., (May 16, 1996). Statemement of George A. Hacker Director,
Alcohol Poliies Project Press Conference on Alcohol Advertising Reforms May
16, 1996, from http://www.cspinet.org/booze/516state.html
Laura Ries. (2008, December 9). Bud Light Finds a Word: Budweiser.
Message posted to
Pauly, David. (May 30, 2008). InBev Takeover Might Mean Bitter End for Budweiser:
David Pauly. Bloomberg.com. from
TNS Media Intelligence. Advertising expenditures for top 25 spending beer brands,
2006 and 2007 [Data file]
(2009). Budweiser: The Great American Lager. http://budweiser.com/
(2009). WELLS DISCOUNT LIQOURS. April 14, 2009),
Anheuser-Busch has direct competitors that affect their business. Miller Brewing
Company's MGD (Miller Genuane Draft) remains to be the top competitor that
Anheuser-Busch’s Budweiser competes against. Since Budweiser is still the number
tops MGD in competition, MGD changed its labeling to attract customers. This causes a
threat to Budweiser, because they have always stayed with their classic design.
Direct competitors aren’t the only ones who affect Anheuser Busch’s sales.
Indirect competitors also play in the market as well. Energy drinks have also affected
Budweiser’s sales. Red Bull stands to be a threat against Budweiser. There are two
types of Red Bull: regular and sugar free. “Sugar Free” Red Bull offers an alternative for
beer, because it’s healthier than Budweiser’s high carbs.The nutritional value is
completely different than Budweiser. Budweiser is a depressant that slows people’s
ambitions. Red Bull is a stimulant that contains loads of caffeine and other ingredients
that “give you wings”. “It has been specially developed for times of increased mental
and physical exertion. In addition, Red Bull vitalizes the body and mind,” (BENEFITS,
2009). Budweiser and Red Bull are completely different on how they target their
audience. They are still in indirect competition with each other despite their different
Miller and Budweiser carry similar prices within a dollar difference between prices
of about $5.99-$6.99. Red Bull is about $1.99 a drink. All three brands are all around
the same price per drink. It depends on where the distribution is for people to buy them.
Budweiser and MGD will be distributed to the target market of 21 years or older. Since
anyone can buy Red Bull, Red Bull is more marketable. “A Red Bull spokeswoman said
1.5 billion cans of the drink were consumed worldwide in 2003, a 10 percent increase
from the previous year. In the United States, Red Bull controls roughly 50 percent of the
$1 billion of energy drink market,” (Lowry, 2004). Budweiser contributed to Anheuser-
Busch’s market share of 59.7%. MGD (Miller Genuine Draft) contributed to 42.1% of
SABMiller plc. Anhueser-Busch still sells more Budweiser compared to SABMiller’s
sales of MGD. Budweiser and MGD can only be found where liquor license are sold.
Red Bull can pretty much be bought anywhere, so it’s marketed more.
SAB Miller’ plc’s top brand, MGD is fermented so it has more of a fruitier
taste. “A beer like no other. After one sip of its fresh-from-the-toap taste highlighted by
fruity, hopy undertones, you’ll understand why we work so hard to brew MGD to
genuine standards,” (BIRTH OF THE GENUINE, 2009). Red Bull has more of an
extensive history compared to Budweiser and MGD. The idea of Red Bull was first
thought of in 1984. Austria was first introduced in fear of its potential. “At the time,
nobody thought that a functional drink previously unknown in the Western World…would
ever stand a chance. That all changed when Red Bull was launched in Austria,” (A
NEW MARKET, 2009). Red Bull went global and was introduced to the U.S. in 1997.
Red Bull was globally accepted before hitting the US market. The history of Red Bull is
far more extensive than MGD’s.
MGD and Red Bull both promote themselves to stand out more for being better
brands SABMiller plc involved MGD in a campaign to target the younger audience of
drinkers. “The campaign aims at attracting adults in their late 20s to 30s who have
drifted away from beer and switched to other alcohol-based drinks, microbrews and
imports, reported AP,” (Miller Genuine Draft Grows Up, 2006). Red Bull most
promotional work comes works sponsoring sporting events. On March 15, 2008, the
NSL (Natural Surfing League) was sponsored for its third annual year by Red Bull. The
NSL is spreading awareness of what surfing really is with the help of Red Bull. “The Red
Bull Riders is the first step to bringing a new outlook to the sport of surfing through the
community and a structure people are familiar with,” (Red Bull Riders Cup: The Game
Begins April 1st
, 2008). Red Bull indirectly competes more with Budweiser, because so
much promotional work that Red Bull does. There was little information to find out about
MGD’s promotional work.
Miller’s advertising expenditures fell in 2006. “Measured media expenditures for
MGD totaled $36 million between January through July, per Nielsen Monitor-Plus,
before Miller pulled the plug last month on MGD's "Beer grown up" campaign,” (Beirne,
Beirne, Mike. (September 25 2006). Miller Looks To Tout 'Genuine' In MGD.
Lowry, Vicky. (2004, May 11). When Coffee Doesn’t Do It, Turned to Can Energy.
NewYork Times. Retrieved
(Febuary 11 2008). Strong growth of volumes and market share in 2008 KP RESULTS
FOR TWELVE MONTHS ENDED 31 DECEMBER 2008.
(2009). Red Bull. from