Sightlines
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Inflation is behind plenty of shifts in consumer behavior today, from the renewed popularity of store-brand groceries to higher levels of credit card debt. But one trend inflation isn’t entirely responsible for? Strong sales of Busch Light.
The causal connection between inflation and increased sales for a value beer brand seems an easy line to draw, as has been suggested by media outlets in recent weeks as inflation and other economic challenges continue to mount for Americans. The thought is that if shoppers spend more on groceries and gas, they’ll choose a cheaper beer brand to keep their budget in line.
But that’s not the full picture. Calling Busch Light a cheap beer may not even be a fair assumption: Busch’s parent company, Anheuser-Busch InBev (ABI), says that, in the states that generate over 70% of Busch Light’s volume sales, Busch Light is priced higher than other value brands and is more closely priced to Budweiser or Bud Light. A check of a Target store in St. Louis, for example, shows a Busch Light 12-pack of 12oz cans priced at $9.99, with the same size package of Budweiser or Bud Light cans priced just a dollar more.
Instead, what’s drawing drinkers to Busch Light is a combination of non-price factors, including increased advertising from ABI; a wildly popular apple-flavored spinoff; and successful marketing partnerships across sports, music, and even agriculture. Busch Light’s popularity shouldn’t be taken as a stand-in for the so-called “value” beer category, either, whose brands have experienced uneven sales trajectories. Nor should it be seen as a red flag for higher-priced premium beers, many of which are attracting more U.S. consumers than ever.
Rather than speaking to consumer sentiment about inexpensive beer, Busch Light is an example of how a parent company invested strategically in a growing brand to accelerate sales both within and beyond its core fans. As Dolly Parton put it, “It costs a lot of money to look this cheap.”
THE LONG GAME
Busch Light’s chain retail sales had been climbing well before current inflationary pressures hit, growing +26% between 2017 and 2021, according to data from market research company IRI. Notably, 2017 was the first year ABI ran a Super Bowl commercial for the Busch brand, and kicked off a new round of investment in the Busch brand family.
It’s not as if fridge-stocking behaviors have led to this recent surge, either:
Busch Light’s best-selling package is a 30-pack of 12oz cans—which has grown its retail sales +1.9% over the last 52 weeks.
But single, 25oz cans have actually shown the highest percentage growth (+10.6%) among Busch Light packages during this timeframe.
Not to be outdone, six-packs of 16oz Busch Light cans have grown at almost the same rate as that 30-pack (+1.7%).
If price sensitivity were behind Busch Light’s rise, that should translate to increased sales for other so-called “value” beers, including Natural Light, Keystone Light, and standard Busch beer. But all three of those have had a sales decline or remained flat in the first half of this year versus the first half of 2021, even as inflation reaches historic levels. (Busch Light has posted 29 weeks of consecutive market share growth within the value category.)
Meanwhile, higher-priced “premium” and import brands such as Michelob Ultra and Modelo Especial continue to grow, too, while costing several dollars more per 12-pack, including notable debuts all in a premium price tier:
The Boston Beer Company and PepsiCo’s HARD MTN DEW flavored malt beverage posted chain retail sales of $20.7 million in the first half of 2022, equivalent to Yuengling Light Lager’s sales during the same period.
Modelo Especial was +17% in chain retail during the first half of 2022.
Michelob Ultra increased +7%.
New Belgium’s Voodoo Ranger Imperial IPA improved +22%.
Molson Coors Beverage Company’s Topo Chico Hard Seltzer Variety Pack surged +119%.
On a recent earnings call, ABI’s CEO Michel Doukeris said that Busch Light has been “on a big run for several quarters already … But I don’t think that has any relation to short-term pressure on consumers.”
POPULARITY CONTEST
Nicholas Meyer, a 23-year-old grocery store employee who lives in Valdosta, Georgia, is emblematic of the new wave of Busch Light superfans. His fellow Marines introduced him to the brand when he was in the service in 2020, and Meyer became enamored of the Busch Light Apple flavor, which debuted that same year.
Last year, Busch Light sold $30.9 million worth of its summer-seasonal Apple flavor in chain retail, just slightly more than Oskar Blues’ total annual sales in those same stores. This year, Busch Light Apple’s sales are on par with Sierra Nevada Torpedo Extra IPA, one of the best-selling craft brands in the country. But that momentum will soon end: Though it’s been a seasonal powerhouse for three years, Busch Light Apple is in its final year, with current stock delivered to shelves in June representing the last available cans. An ABI spokesperson declined to comment on why it’s discontinuing such a popular product, saying only that “Busch Light Apple is going out on a high note with the widest distribution to date.”
At his local liquor store, Meyer typically buys a 24-pack of Busch Light Apple weekly for $22.99, but it’s not only price that motivates him. He also regularly buys more expensive brands of beer and the occasional bottle of Scotch or red wine.
“If I’m not in the mood for Busch—because too much of a good thing is bad—I switch it up to Michelob [Ultra] or Corona,” Meyer says. A recent price check for the Target store in Valdosta, Georgia, shows Busch Light’s 18-pack ($13.99) was priced lower than even Corona or Michelob Ultra’s 12-packs (both $15.99). Meyer’s behavior flies in the face of conventional wisdom about budget-conscious shoppers sparking Busch Light’s growth: Meyer does sometimes spend more on pricier alcohol brands, but returns to Busch Light.
He says he does so because he likes the Apple flavor and the brand’s marketing, particularly its limited-edition cans, which he collects and displays on a shelf in his bedroom. He currently has a collection of Busch Light cans with themes of hunting, fishing, and a specialty John Deere-branded can that a friend of his who lives in the Midwest shipped to him.
“I was very lucky to find that one,” Meyer says. “I didn’t open it either. I just kept it sealed.”
Those limited-edition cans have moved the sales needle nationally, too. The “For The Farmers” collaboration with agricultural machinery company John Deere coincided with Busch Light gaining +0.3 market share in the first quarter of 2022, and +0.45 market share in May. (ABI donated $1 from every 24- or 30-pack sold to farm and ranch aid organization Farm Rescue—up to $100,000—and John Deere matched that donation.)
The John Deere partnership is an example of Busch Light speaking to its fan base, which is concentrated in rural states in the Midwest and South, according to ABI. The company touts Busch Light as the number-one-selling beer in Wisconsin, and adds that Tennessee is the brand’s top state for volume growth.
FUEL ON THE FIRE
Recognizing the geographic concentration of Busch Light fans, as well as their interests—hunting, NASCAR, country music—ABI established new partnerships and marketing opportunities for the brand over the past two years, fueling growth well before discussions of budget-conscious customers became a 2022 talking point.
The company has had a marketing relationship with NASCAR since 1979 and is currently the “official beer of NASCAR,” in addition to sponsoring driver Kevin Harvick. (In an example of unexpected, viral advertising, a video of Katelyn Larson, the wife of NASCAR driver Kyle Larson, shotgunning a Busch Light has been viewed 3.3 million times.)
This year, Busch Light established marketing partnerships with country and country-adjacent music artists Breland, HARDY, and Jordan Davis, and has been hosting ticket giveaways and major activations at country music festivals (including becoming the official beer sponsor of CMA Fest in Nashville).
Seeing the fan response to its camouflage-print cans, which debut each fall to celebrate the start of hunting season, Busch Light introduced a springtime fishing-themed counterpart this March.
The brand may have rural roots, but aims for mainstream appeal. In New York City and New Jersey liquor stores tracked by IRI, Busch Light sales are up +25.6% over the last 52 weeks versus the year prior. And earlier this year, ABI put Busch Light in the Super Bowl commercial spotlight with a 30-second ad featuring saxophonist Kenny G; Super Bowl commercials of that length cost a reported $7 million. The investment was part of expanding awareness of Busch Light to new markets beyond its Midwest core, ABI says.
The marketing, coupled with word of mouth, appears to be working. Michael Starnes is a 23-year-old who works in finance and lives outside of Philadelphia—hardly the classic demographic for Busch Light drinkers. But after his friends from West Virginia turned him on to the brand, he’s been a regular customer. (Like Meyer, he’s especially a fan of Apple, and has stockpiled five cases in anticipation of it being discontinued.)“I wasn’t really a big beer drinker before, but since trying it, I’ve been open to it,” Starnes says, adding that he also drinks Twisted Tea and Miller Lite. “I really like [Busch Light’s] packaging; it stands out. All their merch and Instagram giveaways, how they really engage with their followers …they’re all-around a pretty awesome brand.”
Busch Light has the wind at its back, and plans to use that momentum to broaden its fan base beyond the Midwest and South. It’s the rare legacy, mainstream beer brand that’s enjoying a new wave of success among younger drinkers—a playbook from which other brands no doubt wish they could crib. And given its already established momentum as the U.S. inches closer to a potential recession, the price point can’t hurt, either.
Words by Kate Bernot
