Anheuser-Busch pushes higher-alcohol beers

The brewer is betting big on its new Black Crown brand.

By Jonathan Berr Nov 6, 2012 1:57PM
Men drinking beer copyright Radius Images, CorbisAnheuser-Busch InBev (BUD), the world's largest brewer, is making a big bet on higher-alcohol beers.

Early next year, the beer maker plans to introduce Budweiser Black Crown, which Advertising Age describes as a "golden amber lager" that is "distinctively smooth and beechwood finished." 

Black Crown will receive significant marketing attention, including a possible Super Bowl ad, the trade publication says. A spokesperson for the corporate parent of Bud Light and Stella Artois couldn't be reached for comment.

Shares of Anheuser-Busch, which is based in Belgium, have soared more than 36% this year, as the brewer benefited from strong sales of Michelob Ultra and Stella Artois, as well as new products like Bud Light Lime-a-Rita. One area of disappointment is the flagship Budweiser brand, which the company said "did not meet our expectations." Lackluster U.S. sales resulted in Anheuser-Busch InBev recently reporting disappointing quarterly earnings. That's why Wall Street will be closely watching how the new brand is received.

Black Crown will have 6% alcohol by volume (ABV), matching the content of in Bud Light Platinum, a brand introduced in January that is selling well. It will surpass the 5% ABV in Budweiser and the 4.2% of regular Bud Light. 

The brand marks the latest move by big brewers to recapture the market share they have lost over the past few years to smaller craft brewers and other types of alcoholic drinks.

"I am sure that they will put some serious effort into it," said Eric Shepherd, executive editor of Beer Marketer's INSIGHTS, in an interview. "The wine and spirits industries have done a better job in marketing their products."

The road ahead for Black Crown won't be easy, however. The brand will have to be a hit with young males, the prime market for brewers, and there are already plenty of other brews to whet their whistles, along with other types of libations. Fewer and fewer people are drinking beer, even though some argue that it's healthier than milk, according to CNBC.

Beer made up 53% of alcoholic drinks last year, down from 61% in 1995, according to the U.S. Distilled Spirits Council. During that same time, wine's share rose from 11.8% to 15% and spirits jumped to 31.8% from 27.2%. Data from the Brewers Association shows that the market share for craft beers has climbed from 3.8% in 2007 to  5.68% in 2011.  

Being the King of Beers ain't what it used to be.

Jonathan Berr does not own shares of the listed stocks. Follow him on Twitter@jdberr.
 


 
Tags: BUD
61Comments
Nov 6, 2012 8:18PM
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The formula is simple. Make real beer. I can't believe these people running around drinking diet beer  and telling me how great it is. I like drinking good, full bodied beer. This watered down stuff makes you join the pistol club. Drink till twelve, pistol five.

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Lime a Rita is excellent.  Nice little kick to it, tastes like a cooler.  8% alcohol.
Nov 6, 2012 7:30PM
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If you want a great tasting american lager try "sudwerk" from Davis, CA.  It doesn't cost much more than the cheapest bud brews and it tastes a heck of a lot better.  I found it at Total Wine
Nov 6, 2012 7:29PM
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When Anheuser sold, the economic crisis started, check the time line. Have not had one of their products since they sold. Americans should have and still should boycott them.
Nov 6, 2012 7:28PM
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It is not the 6% alchohol  try to make it bout flavor,richness,bold flavor.  The best Bud I've had lately was the American Lager? asked a Bud driver and he told me it was a test beer and they dont stock it anymore.wtf?Reg Bud is too smooth for my taste?must be the rice? I will try Black Crown when it shows up on shelf. 
Nov 6, 2012 7:13PM
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Let's hope that venturing into the Craft area will not confuse the consumer.  The Craft beers have allowed the domestic beers to raise prices.  Craft brands have created excitement in the beer industry.  They may be selling less Bud, however they are making more dollars.  It has happened in the liquor categories.  If the Craft Brewers keep allowing changes to current Craft beers brewing rules, the consumer will start to rebel against them and not see them as top quality, small batch brands.  If the economy continues to decline, and the beer industry dilutes the Craft category, the consumer will begin to revert back to what they perceive is the "best" and cheapest domestic beer on the shelf.  This will begin the decline of Craft and will begin the race to bring prices down to keep market share.  I don't see these kinds of moves aiding their company in the long run.  Brands like Michelob were once perceived by the consumer as a  "prestige" brand.  I would suggest spending time and effort on current brands than spending time listening to marketing teams and selling internal financial teams.

Nov 6, 2012 7:12PM
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budwiser dumps all their slop beer on Oklahoma,****s

 

Nov 6, 2012 7:10PM
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Let's hope that venturing into the Craft area will not confuse the consumer.  The Craft beers have allowed the domestic beers to raise prices.  Craft brands have created excitement in the beer industry.  They may be selling less Bud, however they are making more dollars.  It has happened in the liquor categories.  If the Craft Brewers keep allowing changes to current Craft beers brewing rules, the consumer will start to rebel against them and not see them as top quality, small batch brands.  If the economy continues to decline, and the beer industry dilutes the Craft category, the consumer will begin to revert back to what they perceive is the "best" and cheapest domestic beer on the shelf.  This will begin the decline of Craft and will begin the race to bring prices down to keep market share.  I don't see these kinds of moves aiding their company in the long run.  Brands like Michelob were once perceived by the consumer as a  "prestige" brand.  I would suggest spending time and effort on current brands than spending time listening to marketing teams and selling internal financial teams.

Nov 6, 2012 7:07PM
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Is Budweiser going to complain when someone in a movie uses their higher alcohol beverage to get drunk just like they are doing now because of Denzel Washington drinking Budweiser to get drunk in the new movie "Flight?" Just wondering....
Nov 6, 2012 6:36PM
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hey guys take note its not american anymore just another foriegn business takeover of an american company claiming to be american maybe its time to change brands
Nov 6, 2012 6:24PM
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FUNNY UP IN CANADA ALL AMERICAN BEER HAVE A HIGHER ALOCHOL CONTENT THAN WHAT IS SOLD IN THE USA.
Nov 6, 2012 6:08PM
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I so agree with the guy who brought up Budweiser's righteous indignation at being showcased as the vehicle that caused Denzel Washington's character in "Flight" to get drunk.  Do they even hear themselves when they talk out of both sides of their mouths! 

Nov 6, 2012 6:00PM
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I think it is a great idea...we will have more drunks on the road crashing more cars and supporting beer joints and auto industry.
Nov 6, 2012 5:56PM
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Never trust beer that has rice as one of its ingredients.

Nov 6, 2012 5:47PM
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How about making a better tasting beer?
Nov 6, 2012 5:42PM
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Beer is okay, drink scotch or bourbon, enough said.
Nov 6, 2012 5:11PM
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All of them will be doing this soon they know that soon they will be in compatition with WEED and the reason beer has gone down is the new drinkers want candy flavors and wine is the closest they have  energy drinks SADLY take the place of beer with many young , AGAIN SADLY as they are now DYING the best way to get some stress relief or change a mood has been WRONGFULLY withheld from WE THE PEOPLE FOR TO LONG and the ones responsible should be persecuted !

so TWIST one and Chill ! and see ?

Nov 6, 2012 5:03PM
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It's well known that InBev's CEO is a penny pincher wanting nothing more than to please the shareholders. To be fair, that's what he's paid to do and he's done a great job doing just that. Unfortunately the quality of the beer has suffered (not that it was very good to begin with). Vendors around the world who had long standing relationships with the Busch family have been replaced by vendors offering lower quality ingredients at a lower cost. That's the real reason their flagship, Budweiser, is underperforming. 

Budweiser/InBev has the resources (a billion dollar marketing budget) to create mass awareness and appeal for the craft beer market in general.  My hope is that Bud's attempt to attract the craft beer market results in new consumers using Bud brands as a "gateway" beer who eventually graduate to more legitimate craft brewers. This may actually work against them
 in the long run. Once people realize what beer is actually supposed to taste like, Bud will have lost them forever. 






Nov 6, 2012 4:49PM
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Budweiser upset Denzel got drunk drinking its beer in 'Flight'
Nov 6, 2012 4:49PM
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After having a few craft beers why would anyone go near Bud, Miller, or Coors? There so much to choose from they are going to have a tough time convincing a lot of people to come back to the fold.
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