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 4:38PM
avatar
I really hope they are betting on craft-brewed flavor, not "higher ABV".  Beer enthusiasts are flocking to craft brews because they taste good, not because they have higher alcohol content.  I just tried the Platinum this Halloween.  It's just another cruddy cheap American lager.  If this Black Crown is just another pathetic domestic lager with more alcohol and some dark coloring then it will be just another flop.  What they really need to offer is some kind of ale.
Nov 6, 2012 4:49PM
avatar
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.
Nov 6, 2012 5:47PM
avatar
How about making a better tasting beer?
Nov 6, 2012 9:27PM
avatar
Why should we care what foreign owned bud is doing?.....Find an AMERICAN or LOCAL brew and drink that ..... We are in a recession....Keep beer profits in America.
Nov 6, 2012 6:36PM
avatar
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 7:29PM
avatar
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 8:18PM
avatar

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.

Nov 6, 2012 5:56PM
avatar

Never trust beer that has rice as one of its ingredients.

Nov 6, 2012 6:24PM
avatar
FUNNY UP IN CANADA ALL AMERICAN BEER HAVE A HIGHER ALOCHOL CONTENT THAN WHAT IS SOLD IN THE USA.
Nov 6, 2012 5:03PM
avatar
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
avatar
Budweiser upset Denzel got drunk drinking its beer in 'Flight'
Nov 7, 2012 4:34AM
avatar
Sell Anheuser Busch back to US buyers and their problem would be solved. We drank Bud because it was American beer. It has been crappy beer for at least 50 years but it didn't matter Bud was an institution. Give up InBev we don't want crappy beer made by Belgians--and we have plenty of American made craft beer that tastes delicious!
Nov 6, 2012 6:08PM
avatar

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 7, 2012 4:27AM
avatar
I was hoping that people would realize that this is just another foreign business trying to get American dollars under the guise of an American beer. I wouldn't drink if came with a dose of viagra. Ok maybe I'd have one.
Nov 7, 2012 10:31AM
avatar
How about simply making a beer that dosnt taste like it was aged in plastic for 50 years.
Nov 6, 2012 7:28PM
avatar
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. 
avatar
I think if I want a good beer I'll just stick with a Great Lakes Dortmunder Gold or some thing comparable. If I want an inexpensive high alchohol beer I'll stick with Molson XXX at least it doesn't taste like Bud Light.
Nov 6, 2012 7:07PM
avatar
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 7, 2012 12:19PM
avatar
Crappy beer with a higher ABV will still be crappy beer.
Report
Please help us to maintain a healthy and vibrant community by reporting any illegal or inappropriate behavior. If you believe a message violates theCode of Conductplease use this form to notify the moderators. They will investigate your report and take appropriate action. If necessary, they report all illegal activity to the proper authorities.
Categories
100 character limit
Are you sure you want to delete this comment?

DATA PROVIDERS

Copyright © 2014 Microsoft. All rights reserved.

Fundamental company data and historical chart data provided by Morningstar Inc. Real-time index quotes and delayed quotes supplied by Morningstar Inc. Quotes delayed by up to 15 minutes, except where indicated otherwise. Fund summary, fund performance and dividend data provided by Morningstar Inc. Analyst recommendations provided by Zacks Investment Research. StockScouter data provided by Verus Analytics. IPO data provided by Hoover's Inc. Index membership data provided by Morningstar Inc.

STOCK SCOUTER

StockScouter rates stocks from 1 to 10, with 10 being the best, using a system of advanced mathematics to determine a stock's expected risk and return. Ratings are displayed on a bell curve, meaning there will be fewer ratings of 1 and 10 and far more of 4 through 7.

114
114 rated 1
278
278 rated 2
474
474 rated 3
641
641 rated 4
639
639 rated 5
663
663 rated 6
640
640 rated 7
499
499 rated 8
284
284 rated 9
122
122 rated 10
12345678910

Top Picks

SYMBOLNAMERATING
COPCONOCOPHILLIPS9
TAT&T Inc9
VZVERIZON COMMUNICATIONS9
KOGKODIAK OIL & GAS Corp9
CVXCHEVRON CORPORATION8
More

VIDEO ON MSN MONEY

ABOUT

Top Stocks provides analysis about the most noteworthy stocks in the market each day, combining some of the best content from around the MSN Money site and the rest of the Web.

Contributors include professional investors and journalists affiliated with MSN Money.

Follow us on Twitter @topstocksmsn.