Bud Light’s first flavor extension, Bud Light Lime, was a huge success this summer for parent company Anheuser-Busch. Bud Light Lime launched in May, backed by a $35 million national marketing push without diluting its sibling brands. Brand dilution is a serious risk when any company takes on a big expansion of a product, and A-B did it well.
Not to say A-B didn’t get help from other beer giants. Coors and Miller merged together and canceled each other out, and Corona, once ever-so-popular, flopped. Coors’ legacy brands stayed steady despite the merger, and Coors even had a 6 percent rise in sales. Unfortunately, Miller’s larger portfolio declined by 2.1 percent, a number that the Coors rise couldn’t offset.
In the past, when A-B has launched a brand extension, brand dilution has been a problem. Case in point: 2005’s launch of Budweiser Select resulted in gains for the company, but only in expense of its other brands. That isn’t the case with Bud Light Lime, however.
A-B believes that about 50 percent of Bud Light Lime drinkers are either haven’t tried beer before or are adding it to their existing beer habits. Another 20 percent are believed to have switched to Bud Light Lime from competitors such as Corona and Miller Chill.
A-B has always had a great marketing team and the budget to help that team achieve high sales numbers. Consider the following:
• The first commercial aired on ESPN in 1979 was for Budweiser. It’s still marketing strong on ESPN, with heavy schedules on NCAA college basketball, Major League Baseball and Sportscenter.
• A-B’s market share is about 50 percent, making it the number one brewer.
• A-B has expanded its marketing efforts to entertainment and financial television venues, sponsoring shows on E! Entertainment Network and CNBC. A-B is reaching a very diverse audience through these types of channels.
• A-B is sticking with cable TV, as cable TV is the best venue to reach its primary target audience of males 21-49. Peter McLoughlin, vice president of corporate media at Anheuser-Busch said, “Cable does an excellent job in delivering male audiences. But we use cable in a different way than just buying spots. We take a sponsorship/ownership position involving developing programs that promote our brand and promote the individual cable networks.” A-B uses the programs with high viewership and uses those in conjunction with the promotion of the cable networks to build a partnership.
• A-B’s Bud brand is expanding its marketing efforts to reach a co-ed audience by its presence on E! and other networks. It’s also trying to expand to the over-50, white-collar, upper-crust crowd, which are more likely to buy A-B’s nonalcoholic brands, like O’Doul’s.
Clearly, A-B uses its marketing strategy wisely. And judging from A-B’s large market share, it’s a marketing strategy a lot of us could learn from.