Anheuser-Busch, the owner of Bud Light, is witnessing a decline in sales, leading to the resignation of its Chief Marketing Officer (CMO), Benoit Garbe. Mr. Garbe, who joined the company in November 2020 and assumed the role of CMO in September 2021, is set to resign at the end of the year to explore new career opportunities. The departure follows a tumultuous period for Bud Light, marked by a controversy involving transgender influencer Dylan Mulvaney, which resulted in a conservative backlash.
The controversy has taken a toll on Bud Light’s sales, with a more than 15 percent dip in sales to wholesalers and retailers reported in Q3. The company attributes a substantial part of this decline to the lower demand for Bud Light, reflecting a larger market share performance issue.
Anheuser-Busch’s financial struggles extend beyond the departure of Mr. Garbe. The company saw a 13.5 percent drop in Q3 revenues, coupled with a 15 percent drop in sales to wholesalers and retailers. Earnings before interest, taxes, depreciation, and amortization also declined by 29.3 percent during the quarter.
The Mulvaney controversy, in which a Bud Light beer can featuring the image of the transgender influencer was showcased on April Fool’s Day, led to widespread calls for a boycott. This significantly impacted the market share of Bud Light, pushing it into second place in U.S. retail sales rankings, with Modelo Especial taking the top spot.
The financial repercussions of the controversy have been substantial, with Bud Light’s market capitalization declining from $133.74 billion to $123.36 billion between April and November 15. This decline allowed rival brands like Coors Light and Miller Lite to gain momentum, with their combined sales surpassing Bud Light by total industry dollars in Q2 2023, which was a dramatic reversal for the brands. Previously, Bud Light had outsold both of the brands combined.
In an attempt to recover from the setback, Anheuser-Busch announced financial support to wholesalers and additional assistance, including extended credit and fuel surcharge reimbursements. Despite these efforts, the company faces a challenging road to regain its market share and repair its brand image.
Anheuser-Busch’s commitment to a transgender agenda, including supporting LGBT festivals and initiatives, continues in spite of the controversy. The company’s executives are pushing ahead with initiatives like supporting the Phoenix Pride festival and making donations to the National LGBT Chamber of Commerce.
The future for Bud Light remains uncertain, and Anheuser-Busch will need to strategize effectively to recover from its largest brand crisis in recent history. As the company grapples with financial headwinds and attempts to rebuild its market share, the trajectory of Bud Light in the coming months will undoubtedly be closely watched by industry observers and consumers alike.
