Anheuser-Busch InBev, the multinational brewing company responsible for Bud Light, is facing a significant crisis, and a former executive has voiced his concerns about the situation. Anson Frericks, former president of Anheuser Busch Sales & Distribution Co., has expressed his belief that the battle has already been lost in a recent column for the Daily Mail.
The crisis began in April when Bud Light partnered with transgender social media influencer Dylan Mulvaney, who has a massive following of 10.7 million on TikTok. However, this collaboration sparked a backlash on social media and prompted some beer drinkers to boycott Bud Light. As a result, Bud Light sales in the U.S. dropped by 28% in the four-week period ending on July 1 compared to the previous year, according to consulting company Bump Williams using data from NielsenIQ.
In response to the marketing fiasco, Bud Light CEO Brendan Whitworth stated, “As we move forward, we will focus on what we do best — brewing great beer and earning our place in moments that matter to you.” However, Frericks criticized Whitworth’s handling of the situation, stating that this statement holds no substance and will only deepen the divide between the brand and its customers.
Frericks has called for a change in leadership, suggesting that it is time for the shareholders and board of Anheuser-Busch to ask Whitworth to step down. He emphasized that he holds no personal grudge against Whitworth, highlighting their positive working relationship during his time at the company.
The crisis has not only affected Bud Light’s reputation but also its shareholders. Since April 1, when Mulvaney first promoted the beer on social media, shares of Anheuser-Busch have plummeted by approximately 13%, resulting in the loss of billions of dollars of market capitalization.
Frericks pointed out that asset management giants such as The Vanguard Group, BlackRock Inc., and State Street Corp. are the largest shareholders in most publicly traded companies. However, he argued that the true shareholders are ordinary Americans, including firefighters, police officers, and doctors, who have their life savings managed by these firms. Frericks believes that these individuals should demand a CEO who truly represents them and their values.
While Bud Light is struggling with declining sales, competitors are seizing the opportunity to gain market share. According to NielsenIQ data, Bud Light is no longer America’s best-selling beer, with Modelo Especial, brewed by Constellation Brands Inc., claiming the top spot. Other beer companies such as Molson Coors Beverage Co. could also benefit from Bud Light’s crisis.
In light of recent developments at Anheuser-Busch, it is evident that beer stocks can be volatile. Investors seeking more stable income opportunities may consider exploring reliable income plays outside the stock market, such as investing in rental properties with as little as $100.
Overall, the situation at Anheuser-Busch InBev remains dire, prompting calls for a change in leadership as the company tackles declining sales and a damaged reputation.