REALITY TV
TV
MOVIES
MUSIC
CELEBRITY
About Us Contact Us Privacy Policy Terms of Use Accuracy & Fairness Corrections & Clarifications Ethics Code Your Ad Choices
© MEAWW All rights reserved
MEAWW.COM / NEWS / HUMAN INTEREST

What is the US's most popular beer? New ruler of brews is not American but capitalizes on Bud Light downfall

The shift comes on the heels of the Dylan Mulvaney controversy that ignited a widespread boycott of Bud Light
PUBLISHED AUG 23, 2023
Modelo sales in grocery and beer stores have overtaken Bud Light for the first time (Pexels)
Modelo sales in grocery and beer stores have overtaken Bud Light for the first time (Pexels)

LOS ANGELES, CALIFORNIA: Modelo Especial has officially dethroned Bud Light as the nation's leading beer brand in terms of sales.

The seismic shift comes on the heels of the Dylan Mulvaney controversy that ignited a widespread boycott of the Anheuser-Busch brand.

According to recent data from NielsenIQ, Modelo sales in grocery and beer stores have overtaken Bud Light for the first time since the beginning of the year, representing a significant shift in the competitive landscape of the beer industry.

What is the US's most popular beer?

As of August 12, Modelo, distributed in the US by Constellation Brands based in New York, secured an 8.34 per cent share of dollars spent on beer, while Bud Light held a slightly lower share of 8.28 per cent.

This development signals a remarkable transition in consumer preferences, as Modelo consistently surpassed Bud Light in monthly sales over the summer months.

(Modelo USA)
Modelo's sales at grocery and beer stores have outpaced Bud Light for the first time on a year-to-date basis (Modelo USA)

 This shift in dynamics can be attributed to consumers distancing themselves from the once-dominant Bud Light brand due to lingering resentment surrounding the Mulvaney ad campaign.

The controversy was sparked by Dylan Mulvaney, a transgender social media influencer with a massive online following, who endorsed Bud Light on her Instagram and TikTok accounts in early April.

The move triggered outrage among certain segments of consumers and led to widespread boycott calls against Bud Light, which had held its top-selling status for two decades.

Sales slump and financial impact on Bud Light and Anheuser-Busch

Sales data for the week ending July 29 revealed a staggering 25.9 per cent decline in Bud Light sales, further underscoring the ramifications of the controversy.

In fact, Bud Light's sales had previously dropped by 26.8% in the week ending July 22, showcasing the extent of the brand's downward spiral.

The four-week period ending on July 1 marked a watershed moment when Modelo overtook Bud Light as the nation's best-selling beer, claiming 8.7 per cent of overall beer sales compared to Bud Light's 7 per cent share.

NEW YORK, NY - JULY 26: In this photo illustration, a bartender pours a Bud Light from a tap, July 2
In this photo illustration, a bartender pours a Bud Light from a tap (Getty Images)

While these figures paint a bleak picture for Bud Light, there are signs that the decline may be stabilizing.

Recent NielsenIQ data indicates that Bud Light's volumes decreased by 26.7 per cent in recent weeks, a marginal improvement from the drastic 30 per cent decline observed since the spring, per the New York Post.

Constellation Brands' strategic triumph

Constellation Brands, the distributor of Modelo, experienced a different narrative. In the face of Bud Light's struggles, Constellation Brands reported better-than-expected earnings for the first quarter.

This three-month period saw an 11 per cent rise in beer sales, reflecting a successful strategy to expand beyond its core Hispanic demographic.

Commenting on Modelo's victory, Benj Steinman, president of Beer Marketer’s Insights, told CNN, "It happened far faster than most people expected."

The sentiment was echoed by Greg Gallagher, vice president of brand marketing for Constellation Brands, who highlighted the company's pursuit of reaching diverse demographics while maintaining its core consumer base.

Gallagher told CNN that the company has been "enjoying an incredible run of success," adding, "Our growth is in maintaining that core but also bringing in non-Hispanic customers, and we’re having incredible success."



 

The decline in Bud Light's fortunes had a ripple effect in the beer industry, with other competitors like Molson Coors (TAP) also experiencing growth.

In a remarkable turn of events, Molson Coors reported its best quarter of revenue since its 2005 merger, with its flagship beers, Miller Lite, and Coors Light, outselling Bud Light by 50 per cent in the second quarter and outperforming Modelo Especial by 30 per cent.

Anheuser-Busch's Challenges

The repercussions of the Mulvaney controversy were not limited to consumer sentiment alone. Anheuser-Busch, Bud Light's parent company, faced significant financial losses.

In comparison to the same period the previous year, the company saw a staggering $390 million decline in North American sales, attributed to its partnership with Dylan Mulvaney.

Dylan Mulvaney attends PFLAG National 50th Anniversary Gala at Marriott Marquis on March 03, 2023 in New York City.
Dylan Mulvaney partnership caused Bud Light sales to tank (Getty Images)

This dip was particularly pronounced in the United States, as sales in Canada bucked the trend by rising.

Anheuser-Busch attributed this decline in revenue to the "volume decline" of Bud Light in the second quarter, leading to a 10.5 per cent drop in total US revenue compared to the previous year's figures.

In response to the controversy and declining sales, Anheuser-Busch issued a statement acknowledging its "underperforming" status within the industry.

The partnership with Mulvaney, marked by her personalized promotional can, had ignited a firestorm of backlash from consumers who perceived the move as an attempt to impose progressive beliefs.

Who owns Modelo Especial?

Constellation Brands, the distributor of Modelo Especial and other popular alcoholic beverages, is under the ownership of several prominent institutional holders.

According to data sourced from Yahoo Finance, the top five institutional shareholders of Constellation Brands as of December 30, 2022, are as follows:

1. Vanguard Group: Vanguard Group stands as one of the largest institutional holders of Constellation Brands, owning approximately 13.1 million shares. This significant holding represents 7.1 per cent of the company's overall ownership.

2. BlackRock (NYSE: BLK): Another major player in the ownership landscape is BlackRock, with ownership of around 11.1 million shares, accounting for 6 per cent of Constellation Brands' shares.

3. State Street (NYSE: STT): State Street holds a substantial stake in Constellation Brands, possessing 7 million shares, which corresponds to 3.8 per cent of the company's total shares.

4. Capital World Investors: Capital World Investors' ownership in Constellation Brands amounts to approximately 6.7 million shares, reflecting a 3.6 per cent ownership stake in the company.

5. FMR: FMR rounds out the list of top institutional holders with ownership of 5.1 million shares, translating to a 2.8 per cent ownership interest in Constellation Brands.

As the dust settles, it is clear that Modelo Especial's rise to the top of the beer market, coupled with the decline of Bud Light, represents a seismic shift in brand loyalty.

The repercussions of this controversy will likely have a lasting impact on the beer industry's dynamics and marketing strategies, highlighting the need for brands to align with their consumers' values and expectations.

RELATED TOPICS DYLAN MULVANEY
POPULAR ON MEAWW
MORE ON MEAWW