Andy Morton

Focus - Bud Light Platinum puts smile on Anheuser-Busch InBev's face

By | 1 May 2012

Anheuser-Busch InBev is bullish about Bud Light Platinums chances

Anheuser-Busch InBev is bullish about Bud Light Platinum's chances

It would have been around February time that Anheuser-Busch InBev first realised that it had a hit on its hands.

Bud Light Platinum, a 6% beer with a price tag one-third higher than Bud Light's, was only released in January but within just one month, it had captured 1% of the US beer market. Back then, analysts urged caution over premature celebrations.

But yesterday, in a conference call on A-B InBev's Q1 results, company executives clearly felt it was time to dig out the party hats.

“[Bud Light Platinum] is a great example of our strategy of doing a few good things and doing them well,” said A-B InBev CEO Carlos Brito.

“We're excited about the prospects for this unique brand,” added A-B InBev's North America zone president, Luiz Edmond.

Q1 figures on the brand backed up the bullishness.

Platinum sold 500m hectolitres in its first two months, helping to make it the most successful launch in the US alcohol market since 2005, according to SymphonyIRI data. It also helped drive 64 basis points of total share growth for the Bud Light brand family, Brito said in the call.

But what has really pleased A-B InBev is the prospect of prolonged growth that Platinum offers in the US. The 1% market share from February is now 1.4%, and repeat-buy figures are healthy enough for A-B InBev to discount sales being driven by first-time buyers.

About 40% of people who have tried Platinum have bought another, Brito said, while 50% of repeat buyers have bought a further two or more. Those numbers, combined with a 72% awareness among the core market of 21- to 34-year-olds and Platinum's 90% distribution through the US, bode well for the brand's future.

Not long after the Q1 results were released, A-B InBev announced it would start production on Platinum in three more of its US breweries, bringing the number of US breweries making the beer up to six out of a total of 12.

There are, however, signs that A-B InBev could still be celebrating too soon.

Reduced unemployment figures in the US may have helped push Platinum sales. Also, A-B InBev can't continue to ignore its other brands such as Budweiser, which the company promises to stabilise over the coming months.

Bud Light Platinum benefited from a marketing blitz during the Superbowl, but Brito said yesterday that the next two quarters will see more activity focus on Budweiser. The start of the baseball season will see new packaging for Budweiser and promotion of Platinum will correspondingly lessen.

To read the company's official results announcement, click here.

Expert analysis

Beer Market in the US to 2014 (Beer, Cider and FABs)

Beer Market in the US to 2014 (Beer, Cider and FABs) is a comprehensive resource for beer market data from 2004 to 2014 and market/company shares for 2008-09.This report also provides data on expenditure and consumption as well as key distribution channels, and reveals the leading companies in the US beer market.

Sectors: Beer & cider, Company results

Companies: InBev

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