E-Malt.com News article: USA: Anheuser-Busch to double digital spend

Anheuser-Busch Cos.' 2007 media plans call for significant increases in marketing spending, but network TV shouldn't expect to see any of the No. 1 brewer's expanding largesse, Advertising Age reported November 28.

"We will be significantly increasing our total spent, with revisions in our media mix to reflect the viewing habits of our consumers," Chief Financial Officer Randy Baker told investors in New York this morning. Those revisions, Mr. Baker went on to explain, include a "significant shift into cable," and a doubling of digital spending.

Mr. Baker didn't provide specifics about how much spending cable would gain -- and how much network would lose -- but he did note that A-B's target audience now spends about two-thirds of its TV-watching tuned into cable, compared to only one-third a decade ago. He also said that the brewer's heavy advertising during sporting events would also remain unchanged, meaning the likely victim of network-TV cuts would be prime-time programming.

Anheuser-Busch spent $287.2 million on network TV during 2005, about 47% of its overall media spend, according to TNS Media Intelligence.

The No. 1 brewer's plans to beef up its internet spending have been public since the summer, when the brewer announced plans for Bud.tv, an internet-based eight-channel TV network. At the time of the announcement, Anheuser-Busch executives said Bud.tv might eat up as much as 10% of the brewer's media budget.

And Mr. Baker's comments made it clear that the budget will be expanding during 2007 for the brewer's trademark brands -- Bud Light, Budweiser and Bud Select -- as well as for smaller brands.

The Michelob brand family, for instance, is getting new package designs and increased ad support as Anheuser-Busch hopes to use it to tap the "trading up" phenomenon that is pushing sales of pricier crafts and imports skyward while domestic macrobrews have generally languished. For the same reasons, Mr. Baker explained, Anheuser-Busch is also boosting support and changing packaging for its Dutch import lager Grolsch.

Rolling Rock, the Latrobe, Pa.-based brand acquired by A-B earlier this year (and now brewed by Anheuser-Busch in Newark, N.J.), will also see a significant increase in spending. A new campaign for Rolling Rock features a fictitious chief marketing officer for the brand apologizing for tasteless ads unworthy of Rolling Rock's "tradition." The scuttled ads -- like the CMO -- are fictitious, but curious drinkers will be able to view them online.

The increased investment comes as Anheuser-Busch and other brewers are struggling to find growth as they continue to lose share of the alcohol market to wine and spirits, and, within beer, to craft and import brewers.

During the first nine months of 2006, A-B managed to grow shipments 2.2%, and smaller rival Coors Brewing Co., the No. 3 brewer, grew by 1.5%, according to estimates by trade journal Beer Marketers Insights. No. 2 brewer Miller Brewing Co. saw shipments slip 2.2%, and No. 4 Pabst Brewing Co. continued its long, downward spiral, falling 7.2%.


01 December, 2006