Beer Monopoly






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Posted April 2011

Beer is a fashion statement

Global beer brands | If only building a global beer brand was a “3v” affair, Budweiser would be the King of Beers. Veni Vidi Vici, or marketing according to Julius Caesar, is like a military campaign. You go in, pick a fight, biff the local king about the chops and the territory is yours. Perhaps Anheuser-Busch thought they could conquer the world Roman-style: one battle at a time. But since taking Budweiser global decades ago, their success was mixed and in the end they failed to steer clear of a Brutus. Maybe that’s taking the analogy a bit far. Yet this goes to show that building a global beer brand is more like a “3c” thing: it's complicated, cumbersome and costly. Especially if you do it from scratch as SABMiller has done with its Italian Peroni brand.
Timidity is not a word that comes to mind when talking about AB-InBev’s CEO. Because if Mr Brito has his way, Budweiser will soon join Coca-Cola, Microsoft, Google and McDonald's in the pantheon of global brands that are almost as popular overseas as in the United States, their country of origin.
Temerity is more Mr Brito’s style. As a sponsor of sports events like the Olympics and the Football World Cup, Budweiser has gained name recognition (or notoriety as a bland and uninspiring beer) in most parts of the world. It has a market-leading position in Canada and sells reasonably well in a few other markets, like China, Ireland, the UK and Italy.
Alas, the “King of Beer”, as Budweiser liked to call itself, it ain’t. In many countries, Budweiser is drunk in homoeopathic quantities. So can the new AB-InBev overcome these obstacles? Mr Brito certainly thinks he can. In March this year, Mr Brito announced that he managed a modest turnaround for Budweiser in 2010 after a steady decline for nearly 20 years. As a next step he plans to introduce Budweiser into Brazil and several other countries where the brand has little or no presence.
Readers will recall that the global growth of Budweiser has often been hampered by legal tussles between Anheuser-Busch and Budweiser Budvar, the Czech brewer that also uses the Budweiser name. Some of these have been settled. AB-InBev reported they now have the right to sell Budweiser or Bud in 33 of 35 European countries.
Many will argue that for Budweiser culture, not taste, could prove an obstacle. Unlike, say, batteries or detergent, beer is a product to which consumers form deep emotional attachments. In some places, it's a key part of a region's or a nation's identity. For international marketers, displacing a favourite local beer brand is harder than introducing a distinctly American product like Facebook, a soft drink or a fast food.
No one knows that better than the former InBev, who failed spectacularly and risibly when they tried to take their Brazilian brand Brahma global. With a certain amount of hoopla and a tie-less CEO John Brock swaying his hips (a cringingly embarrassing sight to behold) InBev launched Brahma into the world market in 2005 only to find out that a brand with a positive image in Bahia has no image -- or, worse, negative connotations - in Brighton and Bonn. A lesson for all: brands must find ways of fitting into their consumers' lifestyles. Otherwise, they will be irrelevant.
Budweiser is no Brahma, Mr Brito will retort. Still, building a global beer brand is a tall order. It sounds great on paper, but out in the streets it can be a challenge. That doesn't mean it is the wrong strategy. It may not work in Belgium or Germany, but if Budweiser can get China, where the premium segment already stands at 3 percent of the total market (ie 13 million hl in 2009) and Brazil, where it is 4.5 percent (ie 5 million hl in 2009), who cares?
Heading for battle
I must admit I enjoy browsing through so-called marketing bibles that lay on thick the war metaphor: the market as a battlefield, competitors as enemies, and employees as foot soldiers. These books make me laugh. Like swords-and sandals movies where grown men romp about in leather miniskirts. If these “how-to”-manuals are to be trusted, market conquest only takes some fearless warriors who will surge into combat, flying colours and all, seek out an opponent and chop off his head. “Veni, vidi, vici – brothers-in-arms, this round of beer is on me.”
Even the much talked-about guerrilla marketing, which the U.S. craft brewers used to swear by, is just a different take on the same spiel: sneak up on your enemy, catch him unawares, hit him and run away with the booty.

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