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Company History
 Financial Analysis
 Industry Analysis
 Porter’s Five Forces Analysis
 Critical Success Factors
 Ext...
 1852 – George Schneider opened Bavarian
Brewery in St. Louis, IL
1860 – Schneider sold the brewery to William
D’Oench &...
Eberhard Anheuser & Adolphus Busch
 Innovators in all aspects of business
Transportation, bottling, &brewing
1870s - implemented a new brewing style from
...
 1879 – Named Anheuser-Busch Brewing Association
 1880 – Anheuser passed away, Busch named president
Busch pushed for e...
 August Anheuser-Busch Sr. era
1920 - Prohibition hits the United States
Other opportunities?
1957 – Named largest brewer in the United States
Family owned and operated until 2008
2008 – InBev purchased Anheuser-B...
2013 revenue of $43 billion, profits of $16.5 billion
Market Share
 United States – 47%
Canada – 40%
Mexico – 58%
Br...
 Often imitated but never duplicated
Focus
Quality
Innovation
Marketing
Acquisitions
Compliments other business asp...
• New York Stock Exchange – BUD
• $43.2 billion in revenue
• $142 billion Total Assets
APPENDIX 1 (AB Inbev Segment Revenu...
• “Stitching”
– 663,074,830 shares, which represented a 41.24%
voting interest
• 521 institutions own 58%
• 379 Funds own ...
BUD vs. SAB.L
$110.60 Stock Price $55.61
$126.27 1y Target $56.00
$177.65B Market Cap $88.92B
782M Float 862M
18.28 Forwar...
• ROA
• 11.6%
• Financed
• 1.56 debt to equity
• inventory turnover
• 5.96 times per year (61 days)
Industry Description
• Part of the brewing industry
• Varies in size
• 4 companies = 90% of industry
revenue
• Highly conc...
Rivalry Within Industry
(Medium)
• Plenty of companies; few with
significant global market share
• Compete for consumer ta...
Supplier Bargaining Power
• Large companies have more
influence on price
• Large volumes purchased
• Market is saturated w...
Threat of Substitutes (High)
• Wine, hard-liquor, soft drinks,
etc.
• Price ceiling on beer
• Price-performance trade-off
...
Buyer Bargaining Power (Medium-
High)
• Three-tier distribution system
• Distributors are gateway to end-
user
• Have more...
Threat of New Entrants (Low-
Medium)
• Microbreweries entering the
market everyday
• Limited shelve space
• Overshadowed
•...
• Continue to innovate; adjust to
consumer taste
• Line extensions, new liquids,
new marketing
• “Open Innovation” concept...
National Beer Wholesalers Association
• Founded in 1938
• 3,300 licensed, independent beer distributors across the US
Empl...
Alcohol Regulation
• 21st Amendment - authority to the state to regulate the sale of
alcohol.
• The Three Tier System - pr...
Conservation Actions
• In their facilities, on the roads and in the marketplace.
• Saving money through environmental init...
Who are our customers?
What do we know about them?
women
men
Hispanic drinking-age adults
2010
2030
2050
0% 5% 10% 15% 20% 25% 30%
Growth Rate
Geographical Promotions
 Michelob Golden
Draft/Michelob Golden
Draft Light
 Midwest
 Ziegenbock
 Kokanee
 Texas
 Can...
How to Identify the Geographic Market Segment
Variety of Marketing Strategies to
Achieve Emotional Connection with
Consumers
Long & Prestigious History of Marketing
E...
Adolphus Busch was Master of
Advertising & Branding
Pioneered Coordinated, Multi-year Ad
Campaigns, Point of Sale Advert...
Epic Super Bowl Advertising Campaigns
 Biggest Event in Sports & Advertising
 $4 Million per 30 Seconds of Ad Time
201...
#4 “Respect” Campaign 2002
Have Appeared in at Least One Super Bowl
Commercial Every Year since 1986
2014 “Puppy Love” Campaign
EXCLUSIVE NFL SPONSORSHIP
6 Year Deal Worth $1.6 Billion
2011-2017
 Strategy Based on 3 Socially Responsible Platforms
Responsible Consumption of Alcohol
Preservation of the Environment
...
Responsible Consumption of Alcohol
First Campaign
Launched in 1982
2013 Blimp
Campaign
New Year’s Eve
Campaign
Responsible Consumption of Alcohol
Resources for Parents to Help Them Discuss
Underage Drinking with Children
Preservation of the Environment
 Reduced Water Use in Breweries by 40% Last 5 Years
 Average Recycling Rate of 99.6% at ...
Emergency Disaster Response
MAY 2014
Joined
American Red
Cross’ Annual
Disaster
Giving
Program
$500,000 for Food,
Shelter,...
Emergency Disaster Response
72 Million Cans of
Drinking Water
Donated to
People Impacted
by Natural &
Other Disasters
Sinc...
Social Media Marketing
Justin Timberlake,
Creative Director
Experiential Marketing
Hottest New Trend in Marketing
Creativeguerillamarketing.com
Experiential 101: What is Experiential...
Experiential Marketing
Julia Mize, Vice President
Experiential Marketing
Anheuser-Busch InBev
Named VP in 2013
Newly Cre...
Experiential Marketing
Temporary Event Venues
2014 Super Bowl
Completely Rebranded
a Cruise Ship
Mainstay of Experiential Marketing
Daily Brewery Tours
5 of 12 Breweries
Experiential Marketing
March 2014
Ballpark Village in
Downtown St. Louis
26,000 Ft2 on 3 Levels
Restaurant, 11 Bars
R...
Marketing Recommendations for Global Expansion
Clydesdales Will Most Likely Not Be as Effective
Sporting Events Such as ...
The world’s biggest beer consumers
• Asia-Pacific’s brewing industry
is worth $258 billion
• The beer market is growing
2 ...
7.2%
6.3%
8.5%
8.7%
Highest potential beer consumption growth for the next five years
Per Capita
Consumption
Overall
Consu...
• Since 2011, AB InBev has acquired
important breweries in China
• The company’s growth in China is
mainly being driven by...
• Continue actively expanding its production capabilities in regions
across China and other countries in Asia-Pacific
Reco...
• Mexico is the world’s 6th-largest beer producer and beer consumer.
• Mexicans drink an average of 62 liters of beer a ye...
• Expected increase in beer demand is primarily driven by factors like:
• robust population base in urban areas,
• strong ...
• Take advantage from the significant growth potential that Modelo
brands have all over the world
• Introduce AB InBev bra...
AB InBev Presentation FINAL DRAFT
AB InBev Presentation FINAL DRAFT
AB InBev Presentation FINAL DRAFT
AB InBev Presentation FINAL DRAFT
AB InBev Presentation FINAL DRAFT
AB InBev Presentation FINAL DRAFT
AB InBev Presentation FINAL DRAFT
AB InBev Presentation FINAL DRAFT
AB InBev Presentation FINAL DRAFT
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AB InBev Presentation FINAL DRAFT

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AB InBev Presentation FINAL DRAFT

  1. 1. Company History  Financial Analysis  Industry Analysis  Porter’s Five Forces Analysis  Critical Success Factors  External Environment Analysis PESTEL Analysis  Customer Analysis  Marketing Analysis Recommendations
  2. 2.  1852 – George Schneider opened Bavarian Brewery in St. Louis, IL 1860 – Schneider sold the brewery to William D’Oench & Eberhard Anheuser Ran brewery under E. Anheuser D’Oench sold his half to Adolphus Busch
  3. 3. Eberhard Anheuser & Adolphus Busch
  4. 4.  Innovators in all aspects of business Transportation, bottling, &brewing 1870s - implemented a new brewing style from the town of Budweis, Czech Republic 1876 – Release of Budwesier
  5. 5.  1879 – Named Anheuser-Busch Brewing Association  1880 – Anheuser passed away, Busch named president Busch pushed for expansion in every aspect of business 1913 – Busch passed away, son named president
  6. 6.  August Anheuser-Busch Sr. era 1920 - Prohibition hits the United States Other opportunities?
  7. 7. 1957 – Named largest brewer in the United States Family owned and operated until 2008 2008 – InBev purchased Anheuser-Busch for $52 billion Anheuser-Busch is St. Louis
  8. 8. 2013 revenue of $43 billion, profits of $16.5 billion Market Share  United States – 47% Canada – 40% Mexico – 58% Brazil – 68% beer, 18% soft drink Argentina – 78% beer, 21% soft drink Belgium – 56%
  9. 9.  Often imitated but never duplicated Focus Quality Innovation Marketing Acquisitions Compliments other business aspects to allow for growth
  10. 10. • New York Stock Exchange – BUD • $43.2 billion in revenue • $142 billion Total Assets APPENDIX 1 (AB Inbev Segment Revenues) Market Revenue (USD million) Revenue (% of Total) Revenue (USD million) Revenue (% of Total) Revenue (USD million) Revenue (% of Total) North America 16,023 37.10% 16,028 40.30% 15,304 39.20% Mexico 2,769 6.40% — — — — Latin America North 10,877 25.20% 11,268 28.30% 11,350 29.10% Latin America South 3,269 7.60% 3,209 8.10% 2,878 7.40% Western Europe 3,620 8.40% 3,625 9.10% 3,945 10.10% Central & Eastern Europe 1,445 3.30% 1,668 4.20% 1,755 4.50% Asia Pacific 3,354 7.80% 2,690 6.80% 2,317 5.90% Global Export & Holding Companies 1,839 4.20% 1,270 3.20% 1,496 3.80% Total 43,195 100.00% 39,758 100% 39,046 100% *AB InBev 2013 annual report pg. 34 2013 2012 2011
  11. 11. • “Stitching” – 663,074,830 shares, which represented a 41.24% voting interest • 521 institutions own 58% • 379 Funds own 2.86%
  12. 12. BUD vs. SAB.L $110.60 Stock Price $55.61 $126.27 1y Target $56.00 $177.65B Market Cap $88.92B 782M Float 862M 18.28 Forward P/E 11.61 0.98 BETA N/A 1.5 Analyst Recom. 2.8 3.60% Yield 1.97%
  13. 13. • ROA • 11.6% • Financed • 1.56 debt to equity • inventory turnover • 5.96 times per year (61 days)
  14. 14. Industry Description • Part of the brewing industry • Varies in size • 4 companies = 90% of industry revenue • Highly concentrated • Increasing popularity of craft beer
  15. 15. Rivalry Within Industry (Medium) • Plenty of companies; few with significant global market share • Compete for consumer tastes • M&A’s to eliminate competition and gain market share • Growing craft beer market • 10% growth • 7% U.S market share
  16. 16. Supplier Bargaining Power • Large companies have more influence on price • Large volumes purchased • Market is saturated with suppliers • Easy to change supplier • Small breweries have less influence on price • Smaller volumes purchased but, • May buy locally • Lower shipping costs • Close relationship
  17. 17. Threat of Substitutes (High) • Wine, hard-liquor, soft drinks, etc. • Price ceiling on beer • Price-performance trade-off • Willing to pay more for a certain feature
  18. 18. Buyer Bargaining Power (Medium- High) • Three-tier distribution system • Distributors are gateway to end- user • Have more control over price • Prevent breweries from over- charging customers
  19. 19. Threat of New Entrants (Low- Medium) • Microbreweries entering the market everyday • Limited shelve space • Overshadowed • Easy to enter the market, hard to get established
  20. 20. • Continue to innovate; adjust to consumer taste • Line extensions, new liquids, new marketing • “Open Innovation” concept • Maintain strong brand image • Continue building a strong, diverse brand portfolio • Use strategic M&A’s to gain new customer segments
  21. 21. National Beer Wholesalers Association • Founded in 1938 • 3,300 licensed, independent beer distributors across the US Employment • 345,000 direct and indirect jobs • 130,000 full time employees National total value of production • $54 billion per year • $10.3 billion per year in federal, state and local taxes • $11 billion per year in alcohol, excise and consumption taxes
  22. 22. Alcohol Regulation • 21st Amendment - authority to the state to regulate the sale of alcohol. • The Three Tier System - provides transparency and traceability Innovation & Technology Committee • Global Data Synchronization, shared services, green solutions, monitoring technologies and e-commerce. LICENSED DISTRIBUTOR LICENSED RETAILERS Responsible Consumers of Legal Drinking Age BREWER OR IMPORTER
  23. 23. Conservation Actions • In their facilities, on the roads and in the marketplace. • Saving money through environmental initiatives Recycled Point-of- Sale Material Hybrid, Biodiesel & Compressed Natural Gas Beer Delivery Trucks Solar Energy Powers Warehouses Energy efficient bulbs and Motion sensors
  24. 24. Who are our customers? What do we know about them?
  25. 25. women men
  26. 26. Hispanic drinking-age adults 2010 2030 2050 0% 5% 10% 15% 20% 25% 30% Growth Rate
  27. 27. Geographical Promotions  Michelob Golden Draft/Michelob Golden Draft Light  Midwest  Ziegenbock  Kokanee  Texas  Canada
  28. 28. How to Identify the Geographic Market Segment
  29. 29. Variety of Marketing Strategies to Achieve Emotional Connection with Consumers Long & Prestigious History of Marketing Excellence
  30. 30. Adolphus Busch was Master of Advertising & Branding Pioneered Coordinated, Multi-year Ad Campaigns, Point of Sale Advertising & Giveaways Used Branded Pocket Knives instead of Calling Cards
  31. 31. Epic Super Bowl Advertising Campaigns  Biggest Event in Sports & Advertising  $4 Million per 30 Seconds of Ad Time 2014 AB InBev spent $28 Million  5 of 16 Best Super Bowl Commercials of all Time Belong to AB InBev Products
  32. 32. #4 “Respect” Campaign 2002
  33. 33. Have Appeared in at Least One Super Bowl Commercial Every Year since 1986 2014 “Puppy Love” Campaign
  34. 34. EXCLUSIVE NFL SPONSORSHIP 6 Year Deal Worth $1.6 Billion 2011-2017
  35. 35.  Strategy Based on 3 Socially Responsible Platforms Responsible Consumption of Alcohol Preservation of the Environment Emergency Disaster Response Invested $1.4 Billion since 1982
  36. 36. Responsible Consumption of Alcohol First Campaign Launched in 1982 2013 Blimp Campaign New Year’s Eve Campaign
  37. 37. Responsible Consumption of Alcohol Resources for Parents to Help Them Discuss Underage Drinking with Children
  38. 38. Preservation of the Environment  Reduced Water Use in Breweries by 40% Last 5 Years  Average Recycling Rate of 99.6% at All Facilities  Utilize Alternative Energy Sources  60% of Fuel at Houston Brewery from Methane Produced at Nearby Landfill
  39. 39. Emergency Disaster Response MAY 2014 Joined American Red Cross’ Annual Disaster Giving Program $500,000 for Food, Shelter, Health Services $250,000 for Support of Blood Services
  40. 40. Emergency Disaster Response 72 Million Cans of Drinking Water Donated to People Impacted by Natural & Other Disasters Since 1988
  41. 41. Social Media Marketing Justin Timberlake, Creative Director
  42. 42. Experiential Marketing Hottest New Trend in Marketing Creativeguerillamarketing.com Experiential 101: What is Experiential Marketing “Helping Consumers Experience a Brand by Engaging as Many Human Senses as Possible to Create Customer Loyalty & Influence Buying Decisions”
  43. 43. Experiential Marketing Julia Mize, Vice President Experiential Marketing Anheuser-Busch InBev Named VP in 2013 Newly Created Position Revolutionize Experiential Marketing Methods 2014 Award for Best Production of an Event (Consumer) for Bud Light 50/50/1
  44. 44. Experiential Marketing Temporary Event Venues 2014 Super Bowl Completely Rebranded a Cruise Ship
  45. 45. Mainstay of Experiential Marketing Daily Brewery Tours 5 of 12 Breweries
  46. 46. Experiential Marketing March 2014 Ballpark Village in Downtown St. Louis 26,000 Ft2 on 3 Levels Restaurant, 11 Bars Rooftop Deck 21’ Long Tap Wall— Swipecard for Self-Serve 200 Beers on Tap 52 High Def TVs
  47. 47. Marketing Recommendations for Global Expansion Clydesdales Will Most Likely Not Be as Effective Sporting Events Such as Cricket Socially Responsible Platforms Relevant to Market Underage Drinking Not as Relevant in Latin America (Legal Drinking Age of 18) Disaster Response in Foreign Markets Focus on the Environment in Foreign Markets Open Breweries with Tours in Foreign Markets Promote International Events with Bud Light Hotel Partner with Other International Organizations
  48. 48. The world’s biggest beer consumers • Asia-Pacific’s brewing industry is worth $258 billion • The beer market is growing 2 times more than the rest of the world • There are 57 million new consumers each year. • Premium segment is growing 2.5 times faster than the overall industry. Fast emerging economies "Beer has a clearer correlation with strong economic growth” Nirgunan Tiruchelvam (Consumer Research Analyst) Globalization Half of the world’s population (around 3.8 billion people)
  49. 49. 7.2% 6.3% 8.5% 8.7% Highest potential beer consumption growth for the next five years Per Capita Consumption Overall Consumption
  50. 50. • Since 2011, AB InBev has acquired important breweries in China • The company’s growth in China is mainly being driven by Budweiser, Harbin and Sedrin brands • During 2012, AB InBev's beer sales by volume in Asia Pacific grew by 1.9% and revenues per hectoliter increased by 10.6%
  51. 51. • Continue actively expanding its production capabilities in regions across China and other countries in Asia-Pacific Recommendations • Continue specially focused on leveraging the increasing spending power of consumers in Asia-Pacific by targeting the premium segment • Consider to expand on other beer brands on this market.
  52. 52. • Mexico is the world’s 6th-largest beer producer and beer consumer. • Mexicans drink an average of 62 liters of beer a year • The beer market in Mexico is growing quickly • The beer production increased 8% from 7.9 B liters in 2010 to 8.6 in 2012 • The beer market is expected to reach a value of $22.1 billion by 2017
  53. 53. • Expected increase in beer demand is primarily driven by factors like: • robust population base in urban areas, • strong gross domestic product growth, and • rising middle-income group and consumer spending. • Last year the company acquired Grupo Modelo, which is the largest brewery in Mexico with 63% of the Mexican beer market
  54. 54. • Take advantage from the significant growth potential that Modelo brands have all over the world • Introduce AB InBev brands in Mexico through Modelo’s distribution network Recommendations

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