SEEING THE LIGHT

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The American brewing industry may have experienced a renaissance in the past decade with the growth of craft beers, but more and more consumers are seeing the light — light beer, that is. Light beer sales continue to shine, with growth of about 2.5% in 1997, solidifying the segment’s status as the largest-selling in the industry. Light beer now represents approximately 40% of the total beer market.

Since industry growth has been modest for several years, light beer’s continued upward climb has given brewers, particularly major domestic brewers, reasons for optimism. The category’s success has hinged on a couple of key factors.

While craft beers have given consumers a taste for different beer styles and fuller-flavored beer, one of the primary reasons they drink beer is still refreshment. Light beer’s lighter, more refreshing taste profile is what more and more consumers are looking for in a beer. Younger adults, especially, are entering through the door marked “light beer” because of its easy drinkability. And though many consumers are experimenting with different and heavier beer styles on special occasions, most beer drinking is linked to social situations in which consumers want to have more than one beer, and light beer fits the bill.

“The beer-drinking population is willing to experiment, but overall prefers a lighter, lager-style beer,” said Dave Taylor, a spokesman for Coors Brewing Co.

Light beer also fits a lifestyle image for many consumers. Consumers may have originally been drawn to light because it offered fewer calories than regular beer, but early ad campaigns for light beer gave consumers a different perspective on the product’s benefit. Brewers positioned light beer as a product that wouldn’t detract from — and, in fact, would even enhance — consumers’ active lifestyle. And as people have become even busier and more active, light beer’s appeal is now greater.

That appeal, and light beer’s success, to a degree, is also a self-fulfilling prophecy. The more emphasis brewers put on light beers, the more likely it is that consumers will choose to drink them.

“There’s clear evidence that the industry is focused on flagship brands,” said Bob Lachky, vice president of brand management at Anheuser-Busch Inc. “This is perhaps the first time in many years that Coors and Miller also are following our strategy of focusing on core brands.”

When the craft beer segment started making news, the major domestic brewers diverted attention and resources away from the brands that traditionally deliver big volume. Now that they’re all putting renewed emphasis behind their light beer brands, there’s more “noise” in the category drawing consumer attention. And even before the key summer selling season begins, brewers are promising a lot of noise this year.

Headlights


The past year has seemed more like old times in the category. The Big Three — Bud Light, Miller Lite and Coors Light — have gone back to their fierce rivalry, churning out new creative and promotions in an effort to win consumers.

Bud Light has been on a tear, delivering hefty volume increases for five years straight. Though some say the brand has grown at the expense of Budweiser, A-B execs have a different view. “Budweiser is still the best-selling brand in the world,” Lachky said. “It was down slightly last year, but has stabilized, so there still are two distinctive drinkers.”

While both brands are getting a significant infusion of marketing dollars this year, Bud Light’s marketing budget is being bumped 30% “to compete with the increased share of voice” Coors and Miller are vying for, according to Lachky. The Budweiser family, including Light, kicked off the year with its perennial favorite, the Bud Bowl.

The Bud Light campaign will get fresh spots but continue in the same vein, targeting “the active lifestyle and irreverent sense of humor which has gotten us here,” Lachky said. The brand’s placement of television ads in prime time slots is also new.

Grassroots (local) marketing has been an integral part of the brand’s strategy, according to Lachky, and this year’s programs will give retailers the support to focus on specific needs — increasing longneck sales, for example.

Lights On


“No matter where you are, it’s Miller Time,” said Michael Johnson, Miller Lite franchise director at Miller Brewing Co. “We want to keep it fresh and keep it coming. Every time the consumer comes into contact with Miller Time, it will be unexpected and fun.”

This summer, the brand will repeat last summer’s proven tie-in with Sports Illustrated and supermodel Rebecca Romijn. Called “Summertime’s Miller Time,” the promotion will overlap the Memorial Day and July 4th promotion windows into one event.

Coors Light is getting more attention, too. “It’s obviously our biggest brand and one we’re focused on,” said Taylor.

The brand’s “Hey. Beer. Man.” ad campaign hit the mark with consumers and will be more fully integrated across the board into p-o-s and promotions this year. And the company will reprise last year’s successful “Blast of Cash” promotion for Memorial Day weekend.

This summer, consumers will get a chance to win a trip to Major League Baseball’s All-Star game at Coors Field in Denver. Spokesmen for the promotion are Nolan Ryan, Hank Aaron and Tony Perez, and five winners will get to watch the game with the baseball trio. One finalist will have a chance to step up to the plate and win $10 million for hitting a home run.

“Our strategy as the number-three player is not to outspend,” said Taylor, “but compete aggressively by being smart and designing innovative promotions and packaging and focusing our efforts at retail, not just on distributors, and working with them to drive business volume.”

Highlights


One of the reasons premium lights fared so well has been a general consumer move back to known and trusted brands. Premium lights aren’t the only ones to benefit from this trend. Most high-end light beers also are doing well, largely due to a halo effect from their parent brands, but on their own merits as well.

Michelob Light didn’t perform as well as expected last year; much of the attention on the Michelob brand was diverted to the successful rollout of the Michelob Specialties last year.

“Consumers expect us to do more behind the brand,” Lachky said, “so we’re putting most of our effort behind Light this year.”

An ambitious campaign includes new “Beer or Michelob?” ads featuring product shots of Michelob Light that broke during the winter Olympics, and a return to the brand’s association with golf, but through promotions, not advertising. The new ad campaign runs in print, television, radio and outdoor, media and features real people in humorous real-life situations.

Michelob Light also gets a new facelift this month, with changes to both primary and secondary packaging. The change “reinforces the heritage of the brand,” according to Lachky. Only the label will change, however, not the brand’s trademark teardrop-shaped bottle.

“There’s no reason we shouldn’t bring Michelob Light back on a positive growth track this year,” Lachky said.

Imported lights, meanwhile, are doing very well, led by Amstel Light and Corona Light. Amstel Light, which has been growing nicely by itself, got an added boost last year from the launch of Amstel and Amstel 1870 in selected markets.

“The impact on Amstel Light has been tremendous,” said Yuri Schwalbe, Amstel brand manager at Heineken USA. “It has stimulated very strong growth.”

Corona Light has gotten a tremendous boost from the popularity of Corona. Corona Light is now co-branded in all advertising and promotions, but will get its own radio and outdoor advertising this year in select markets. Corona Light shares the parent brand’s fun-in-the-sun image, and its lower-calorie profile expands the brand’s appeal to a broader base of consumers.

Support this year includes traditional Cinco de Mayo point-of-sale materials, soccer displays, the summer “Corona Cantina” and the brand’s perennial tie to Jimmy Buffet’s concert tour.

Northern Lights


Light beers from Canada also have been performing well. For example, Labatt Blue Light has been growing at a healthy pace for the past two years.

“Historically, imported lights haven’t performed as well as domestics,” said David van Wees, director of Canadian brands at Labatt USA. “But now they seem to be positioned well to take advantage of trends.”

The trends, of course, have been the concurrent growth of light and lighter-tasting beer and interest in fuller-flavored imports, craft beers and micros. Imported light beers, with their somewhat fuller flavor than domestic counterparts, give consumers what Amstel’s Schwalbe calls “the best of both worlds.”

Molson is still using Molson Ice and Molson Golden as lead brands in its promotions, but will co-brand most, if not all of them. This month, the brand kicked off its Hockey Hall of Fame promotion, giving consumers a chance to shoot their way into the Hockey Hall of Fame during the Stanley Cup finals in May.

Labatt Blue Light is doing so well that Labatt USA is singling it out for advertising and promotions this year to help accelerate its growth. A separate ad campaign for Blue Light with both TV and radio spots is expected to break in key markets this spring. Also coming up is a Blue Light promotion called “Experience The Northern Light.” At retail, consumers will have a chance to win a trip to Canada.

Lowlights


Even below-premium and popular-price light beers have been able to take advantage of category growth. The popular-price segment in general has been hit hard in the past couple of years by a double-whammy — a strong economy that has seen consumers trading back up to premium brands and even paying much higher prices for craft beers, and heavy discounting by premium brands that has closed the gap with popular-priced brands.

At The Stroh Brewery Co., Old Milwaukee Light is getting some attention of its own after years of being tagged onto Old Milwaukee spots and p-o-s materials. Last fall, Old Milwaukee Light took the gold medal in the light lager category at the Great American Beer Festival, giving the brand a reason to toot its own horn.

“We really haven’t had enough marketing money to emphasize Light over the parent brand,” said David Morris, vice president of brand management at Stroh, “but this plays into our hands. We didn’t have any news before. Now we have news.”

Busch Light Draft has been selling well enough that A-B has pulled most of its media budget and moved it over to support Budweiser. Busch will now get only outdoor support. “It has a strong enough image that we don’t need TV,” Lachky said. A-B’s other light beer, Natural Light, doesn’t get any image advertising, only point-of-sale. But that hasn’t prevented the brand from being a solid performer year after year.

Even with the majors gearing up to take advantage of one of the few growth areas of the business, others still see opportunities in the category. As often as they’ve tried in the past to come up with new products or new ways to market light beer, brewers are always searching for the next successful product. Miller, A-B and Coors all have introduced and abandoned light beers in recent years.

“It’s an evolving category as far as I can see,” said Darin Wolf, brand manager for Rolling Rock Light. “Big breweries are targeting that as the product to push. We think there’s a tremendous opportunity within the light segment to offer a beer with meaningful equity.”

Rolling Rock, which went through some repositioning last year to return closer to its roots, restaged and repackaged Rock Light as Rolling Rock Light to take it national. For nearly 20 years, Rock Light was limited to core markets close to Latrobe’s brewery in Pennsylvania. To keep it distinct from Rolling Rock, Rock Light used snowflake imagery to denote its crispness. The new product borrows significant equity from Rolling Rock, while establishing its own identity through bold graphics and silver-colored six-pack carriers.

Though Rolling Rock Light isn’t getting any advertising of its own this year, Rolling Rock’s budget includes a lot of co-branded materials.

A-B still hasn’t given up looking for alternative light beer products, either. The company’s lower-calorie Anheuser Light never made it out of test markets several years ago. More recently, A-B tested a product called Meridian Blonde in California. Described as “light, crisp and lower in calories and alcohol than typical light beer,” it was pulled from test markets at the end of the year. The product is back in test as Catalina Blonde in Missouri, however.

“We feel like there’s an opportunity for this type of product,” explained Colleen Beckemeyer, senior brand manager of new product development at A-B. “It’s unique; there’s no product like it. The distinction between Anheuser Light and this is that now we’re not focusing on calories.”

Advertising for the brand hasn’t been developed yet, but it likely will be positioned on taste and imagery, not lower calories or alcohol content.

But the product that may finally be the twist the category needs is IC Light Twist from Pittsburgh Brewing. Introduced last summer, the brand is rolling out this year to markets outside Pittsburgh, including California, Florida, Texas and New York.

Twist is an ultra-light (86 calories) beer with a hint of flavoring. Currently available in two flavors, Acapulco Lime and Rio Cherry, Twist is packaged in longnecks with very hip, tropical labels.

“Research says people are pleasantly surprised that Twist has only a hint of flavor,” said Michelle Neilan, marketing assistant on the brand. “The problem we were having was that people think it’s a summer drink, so we’ve done a new campaign to stress the beer aspect of it.” Outdoor, radio and some print ads note that it’s “Light beer with a twist.”

Whether fruit flavoring is the right spin on light beer or not, one thing is certain. Increasing numbers of consumers are heading for stores in search of light beer. Brewers are increasing their marketing budgets to make sure consumers are aware of their products, with everything from ad to sweepstakes promotions. Now it’s up to you to make sure you have plenty in stock for the onslaught of the summer selling season.


Michael Sherer is a Seattle-based writer and consultant specializing in beverages and foodservice.


Leading Domestic Light Beer Brands
(Thousands of 2.25-Gallon Cases)

Brand Brewery 1996 1997e % Change
Bud Light Anheuser-Busch 273,000 297,000 8.8%
Miller Lite Miller Brewing 220,000 226,000 2.7%
Coors Light Coors Brewing 189,500 200,000 5.5%
Natural Light Anheuser-Busch 95,500 93,000 -2.6%
Busch Light Anheuser-Busch 59,000 58,000 -1.7%
Michelob Light Anheuser-Busch 33,700 33,000 -2.1%
Keystone Light Coors Brewing 28,500 29,300 2.8%
Milwaukee’s Best Light Miller Brewing 17,800 18,000 1.1%
Old Milwaukee Light Stroh Brewing 15,000 13,000 -13.3%
Miller Genuine Draft Light Miller Brewing 14,500 10,500 -27.6%
Schaefer Light Stroh Brewing 8,000 7,000 -12.5%
Stroh Light Stroh Brewing 4,000 3,500 -12.5%
Rolling Rock Light Labatt USA 460 480 4.3%
Total Leading Brands 958,960 988,780 3.1%
Other 41,333 36,765 -11.1%
Total Domestic Light Beer 1,000,293 1,025,545 2.5%
e 1997 estimates. Source: Adams Handbook Advance 1998

LEADING IMPORTED LIGHT BEER BRANDS

(Thousands of 2.25-Gallon Cases)
Brand Importer Origin 1996 1997e % Change
Amstel Light Heineken USA Netherlands 5,272 5,400 2.4%
Corona Light Barton/Gambrinus Mexico 1,500 1,750 16.7%
Molson Light Molson USA Canada 1,300 1,250 -3.8%
Labatt Light Labatt USA Canada 900 950 5.6%
Beck’s Light Dribeck Importers Germany 170 180 5.9%
Total Leading Imported Beer 9,142 9,530 4.2%
e 1997 estimates . Source: Adams Handbook Advance 1998


BRAND SPONSORSHIPS

Event sponsorships — especially for professional sports –have become an integral part of the marketing mix for brewers. Here’s a short selection of some of the programs from the major brewers.

ANHEUSER-BUSCH

The Budweiser brand, including Bud Light of course, was the exclusive beer sponsor of the Winter Olympics in February, and has exclusive rights to World Cup Soccer this spring and summer. To reach more women, the brand has backed women’s sports like pro basketball and volleyball with substantial deals. A-B is also sponsoring a Budweiser car this year on the NASCAR circuit.

MILLER BREWING

Sports sponsorships are just as integral to Miller Lite as other light beers in depicting active lifestyles and appealing to core drinkers — male sports fans. In April, the brand’s NASCAR tie-in goes national with Rusty Wallace point-of-sale and television ads to support the “Miller Lite Pledge Drive.” Consumers are urged to help raise money for the Miller Lite racing team, beer by beer, through purchases of Lite. The promotion includes an offer of a Sounds of Racing CD.

The brand’s association with the AVP pro volleyball tour also gets television support this spring. Ads will take consumers back in time and introduce the people who helped form the tour. And local marketing initiatives will take advantage of associations with pro teams like the Houston Rockets, Chicago White Sox, Detroit Red Wings, and even events like the Kentucky Derby.

COORS BREWING

Coors Light also is back on the NASCAR circuit with a new driver, Sterling Martin, and will be doing new regional promotions like last year’s “Engine Block” package. As usual, the Coors brand has significant presence with Major League Baseball, as do the other major brewers.

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