As NFL football returns, Bud Light will spend 'enormous amount' to win back beer drinkers
Anheuser-Busch InBev's Bud Light aims to regain share from rivals such as Molson Coors by highlighting the football fan experience.
The fan-fueled fall combo — beer and football — is back.
As the NFL season kicks off on Thursday, fans are eager to see the Kansas City Chiefs play the Detroit Lions. But there's another showdown happening: the "beer battles" as Anheuser-Busch InBev's Bud Light (BUD) aims to win back once-loyal consumers.
"We're going to see an amazing competitive battle this fall," Tim Calkins, a marketing professor at Northwestern University, told Yahoo Finance. "People will be very focused on the football games, but I think the beer battles might be more interesting."
The NFL season will be crucial for AB InBev after months of declining sales. And the company appears ready to shell out on advertisements featuring "safe terrain" subjects such as the NFL and fan experience, Calkins added.
In one of the brand’s biggest NFL campaigns ever, called "Easy to Sunday," Bud Light is focusing on beer-drinking die-hard footfall fans, reminding consumers it's the official NFL sponsor.
"Bud Light is likely to spend an enormous amount of money to try to rebuild its brand after the shocking declines earlier this year," Calkins said. "The competitors are going to work very hard to make it difficult for Bud Light to do that."
Bud Light sales 'reached a point of stabilization'
This football season, beer brands are entering "uncharted waters," Bump Williams of Bump Williams Consulting told Yahoo Finance.
"We've always seen Bud Light as No. 1," Williams added. But for the past 15 to 16 weeks that tale has turned, and Bud Light is struggling to make it to the end zone of a challenging year.
Sales of Bud Light declined sharply in May after a marketing campaign with transgender influencer Dylan Mulvaney sparked a widespread boycott, causing it to lose the top spot to Modelo in May.
Several months later, Bud Light sales are still down 26.9% compared to last year, according to Bump Williams Consulting data, while competitors such as Coors Light (TAP) continue to get a boost, up 21.3%.
"Tracked channels have reached a point of stabilization at significantly lower levels for Anheuser-Busch InBev than pre-controversy," Robert Ottenstein, senior managing director and partner at Evercore ISI, wrote in a note to clients.
Meanwhile, Anheuser-Busch InBev's other brands — including Michelob Ultra and Busch Light — improved slightly, though "both remain below pre-controversy levels as the boycotts on ABI’s greater portfolio continue at a lesser magnitude," Ottenstein said.
If current trends continue, Ottenstein added it raises the possibility of "significant structural changes" in the industry.
Consequently, Bud Light is trying to "salvage some kind of positive year for their portfolio," Williams said.
Bud Light hoping to 'recapture' positive associations
In its new ad campaign, Bud Light shares lifetime football fans' rituals around the sport and drinking beer.
Daniel Korschun, a marketing professor at Drexel University, said this is a typical marketing tool, tapping into emotions and nostalgia by highlighting real people, such as a Philadelphia Eagles fan and military veteran.
"It's really the art of building associations between the brand, ... thoughts, emotions, and experiences that then drive purchase behavior," Korschun said. "In this case, they're saying, 'We had these strong connections before. ... We're going to recapture those associations and rebuild them.'"
Stefanie Boyer, a marketing professor at Bryant University, noted that the campaign demonstrates that Bud Light is refocusing its audience: "They're really working hard to try to reach their fans, to try to show their fans that they know them."
However, Bud Light sales aren't likely to rebound right away.
"I suspect it's going to be a very slow process ... as all the controversy fades into the past," Calkins said. "I think you'll see people begin to reach for Bud Light a little bit more. The brand has so much history. ... They're going to rebuild, but it's going to take a long time to do that."
It may already be too late. Molson Coors is determined to hold on to the market share it gained.
The AB InBev rival, which is now getting into other beverages and spirits, is increasing its marketing spend by $100 million for the rest of 2023. It's also kicking off the season with a 15-second Miller Lite ad spot, focusing on fans gearing up for a big game. A Coors Light ad is set to debut later this season too.
"The market share that Bud Light lost went to these other brands," Calkins said. "Now the challenge for the other brands is to hang on to it."
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Brooke DiPalma is a reporter for Yahoo Finance. Follow her on Twitter at @BrookeDiPalma or email her at bdipalma@yahoofinance.com.
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