PM: Anheuser-Busch’s InBev stock has been downgraded by HSBC to ‘a stock to hold’ following Bud Light’s disastrous marketing campaign featuring transgender activist Dylan Mulvaney.
Managing director at HSBC’s global beverage sector Carlos Laboy told Yahoo News that there are “deeper problems than ABI admits” after the social media partnership with Mulvaney last month.
Laboy wrote in a note on Wednesday, “Is ABI’s leadership getting the brand culture transformation right? It’s mixed,”
He continued, “At Ambev, we think the answer is ‘yes;’ in the US, we think it’s ‘no.’ The way this Bud Light crisis came about a month ago, management’s response to it and the loss of unprecedented volume and brand relevance raises many questions.”
Bud Light boycott leading to downgrades by stock analysts.
Branding crisis, huge sales drop … 🤔 pic.twitter.com/RUHCzSYISN
— Wall Street Silver (@WallStreetSilv) May 11, 2023
Laboy cited a note from Beer Marketer’s Insights which said their company suffered a 25 percent drop in beer sales in April. He added, “Why did its US leadership underestimate the risk of pushback given the recent experience of other firms? Is A-B hiring the best people to grow the brands and gauge risk? If Budweiser and Bud Light are iconic American ideas that have long brought consumers together, why did these marketers fail to invite new consumers without alienating the core base of the firm’s largest brand?”
According to recent data, US retail sales of Bud Light have dropped 23.4 percent versus a year ago during the week of April 29, a decline worse than the 21.4 percent the brand suffered a week earlier.
During the first three weeks of April, sales of Bud Light in the US dropped to the equivalent of 1 percent of the company’s global volume for the time period, according to Fox News.
The clearest thing about the Bud Light debacle is that the company has no idea who their customer base was.
Anheuser-Busch’s stock downgraded following tanking sales and branding 'crisis'https://t.co/14p3s2Qinm
— Libby Emmons (@libbyemmons) May 11, 2023
Meanwhile, the company’s competitors Coors Light and Miller Lite saw their sales increase by nearly 21 percent.
Bump Williams, chief executive of Bump Williams Consulting and NielsenIQ data that revealed the sales collapse told The New York Post, “It’s not just a Bud Light issue, It’s an Anheuser-Busch portfolio problem now.”
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