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Thursday, February 4, 2016

The 2016 Plan: No Quitters at Anheuser-Busch

Like 'em or hate 'em, you have to give the folks at Anheuser-Busch credit. They've been called anti-competitive sociopaths and delusional sycophants. But one thing you never hear them called is quitters. They don't know the meaning of the word.

I've been reading various reports on the AB strategy for the coming year and it is mesmerizing. The guys evidently believe there's no such thing as a dead end brand that can't be returned to viability via truckloads of cash and retread marketing schemes. Never mind the actual product.

The big idea, as usual, is gaining market share, something AB hasn't done since 2008. There's a pile of PR schlock behind that goal. Some of the themes include "investing in the future" and "strengthening relationships." Just the kinds of things you expect to hear from talking heads in a woebegone organization.

Of course, growth is tough when you've got a bunch of brands in freefall. AB has been losing share in the premium segment for years, and the decline is redlining with young drinkers who are uninterested in the products and largely unreachable via traditional advertising channels. It's a serious problem.

That reality is driving investment in the so-called High End, which expanded with the acquisition of several craft breweries in 2015. Expect a continuation of that theme in 2016, as spending will reach a new, unspecified high. The High End segment likely represents the best chance they have to offset declines through the rest of their portfolio.

Their goal with the High End segment is aggressive. They hope to double whatever the growth rate is in craft beer. If craft hits 20 percent growth this year, AB wants the High End to reach 40 percent. It's probably unrealistic, but that's what happens when you're desperate to grow your numbers and your new product pipeline is vacant.

They do have winners in the High End. Goose Island IPA, now brewed in factories everywhere, had a big year in 2015. AB wants it to be the #1 IPA in the land this year. Its other craft minions, including 10 Barrel, Elysian and Blue Point, also did well. Then there's Stella Artois, which was up 20 percent and will receive additional investment in an effort to double volume within a few years.

Along the lines of refusing to quit on flat-lining brands, the suits are determined to revive the fortunes of Shock Top, their very own fake craft brand. They are upping the ante considerably, spending more out of the gate than they did all of last year. Among other things, that money will buy Shock Top a Super Bowl spot. You won't want to miss it. Trust me.

The best I've saved for last. Bud Light, which has been in steady decline in recent years, will get the biggest investment ever. The guys simply refuse to quit on their pet brand. Instead, they'll leverage their connection with the NFL, including several Super Bowl ads and team cans. Some cities will even get NBA cans, apparently. Because everyone knows the road to improved brand identity and credibility is paved with fancy new packaging.

Some people say the guys at AB don't have a sense of humor. But that can't be true. When you stubbornly hang onto flagging brands and your only winning strategy is buying up your competition because you don't have any new ideas of your own, you better have a sense of humor.

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