US: Big brewers should ditch brand extensions for new styles - research
The report argues that brand extensions are not the way forward for mainstream brewers
Mainstream US brewers have mostly failed to have a "lasting impact" on sales with expensive brand extensions and should instead copy craft brewers by launching new styles, according to a new report.
A Mintel study, published yesterday (28 January), argues that the country's high-volume brewers are at a "crossroads" as volumes remain stagant and market share is being lost to craft beer, wine and spirits. "Although they have introduced premium, craft-style brands such as (MillerCoors') Blue Moon to capture the excitement over craft beer, they also have largely failed to produce brand extensions that have a lasting sales impact on the market," the report says.
"Bud Light Platinum (brewed by Anheuser-Busch InBev) exemplifies a brand extension that had early success due to marketing buzz, but growth quickly dried up after drinkers recognised that no amount of hype can drown concerns about taste."
Mintel predicts that US beer sales by value will further outpace stagnant volume growth over the next four years, as consumers continue to trade-up to premium and craft brands.
"Instead of launching new products that amount to costly advertising adventures, big beer brands should continue the trend toward premiumisation with more focus on quality," the report says.
In its nine-month numbers, A-B InBev reported a 2.8% slide in North America volumes, while sales were up 3.7%. MillerCoors reported a 2.9% drop in year-to-date volumes and flat sales.
"Perhaps," Mintel suggests, "they should follow the example of smaller, craft brewers in showcasing brewing processes, emphasising quality ingredients, and introducing new styles and flavors that are not just extensions of light beer."
Despite the ongoing rise of craft beer in the US, analysts at Nomura have forecast that the segment will still only account for 10% of the country's overall beer volumes by 2017.
With the end of the year looming, just-drinks is running a series of 'Top Tens of the Year' in the run-up to Christmas. Here are the ten most read comment pieces by just-drinks' editor, Olly Wehring, ...
Anheuser-Busch InBev SA/NV - Strategy and SWOT Report, is a source of comprehensive company data and information. The report covers the company’s structure, operation, SWOT analysis, product and servi...
With the end of the year looming, just-drinks is running a series of 'Top Tens of the Year' in the run-up to Christmas. Here are the ten most read analyses on just-drinks in 2014....
Anheuser-Busch InBev NVSA (ABI) - Financial and Strategic SWOT Analysis Review provides you an in-depth strategic SWOT analysis of the company’s businesses and operations. The profile has been compile...
Anheuser-Busch InBev Germany’s strategic direction is mainly in line with the international parent company and the company does not have a lot of room for self-governance. Partial autonomy is granted,...
Anheuser-Busch InBev (A-B InBev) is facing challenges in the mature US beer category by focusing on premium and craft beer. As the US Justice Department precluded A-B InBev from controlling the lucrat...
- Cuba-US Normalisation: Bacardi, Pernod Winners?
- Review of the Year 2014 - Part IV: Spirits
- Sustainability in Wine - Part I
- Comment - The Appeal and Perils of Craft
- Time is Right for Refresco Gerber Exit
- Belvédère to sell assets, streamline portfolio
- Belvedere vodka tie-up over new James Bond film
- Diageo ups focus on China with Mortlach roll-out
- Diageo welcomes verdict on Crown Royal "confusion"
- Bacardi, Pernod Ricard welcome US-Cuba deal
- Global vodka insights - market forecasts, product innovation and consumer trends research
- Global Scotch whisky insights - market forecasts, product innovation and consumer trends research
- The IWSR Forecast Report - 2014-2019 Global Review
- Global Tequila Market 2014-2018
- just-drinks on-trend: Craft beer - fortunes and future