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Archive for May 21st, 2009

It is interesting to get a glimpse of the thinking of the men in suits once in a while. Those who think that Bud and Heineken are high quality beers just because they charge premium prices for them.

Dave Peacock, president of the US operations of Anheuser-Busch InBev NV boldly proclaims in the Wall Street Journal that We feel we have brands that can meet any consumer need.

Not my needs, I can tell you.

But there is some substance to the story in the Wall Street Journal, too:

This year through April 19, U.S. retailers’ sales of domestic “subpremium” brands were up 2.6% by volume and 8% by value from a year earlier, according to market-research firm Information Resources Inc. The data exclude sales at bars, restaurants and Wal-Mart Stores Inc. outlets.

By contrast, the U.S. beer industry’s total volume rose just 0.5%. Sales of “premium” beers, such as Bud Light and Miller Lite, which account for about half the industry’s total sales, fell 1.4%.

For shoppers, the math is simple. While prices vary, Busch Light or MillerCoors’s Keystone Light generally cost around $14 a case, about $5 less than a case of Bud Light or Coors Light.

Not long ago, drinkers were “trading up,” favoring imports, small-batch “craft” beers and premium lights. Now, Heineken and other import brands are struggling, and the growth of craft beers has slowed.

There is further reporting pointing to the same trends, among them an article in Beverage Daily showing that consumers are more cost conscious when buying alcohol.

Maybe some consumers are concluding that one crap lager is as good as the next one, and that the only premium about Heineken is the price? The truly amazing fact is that so many of us have been fooled for so long!

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