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Anheuser-Busch today relaunches its controversial loyalty-program sales promotion, backed with an expected $20 million-plus marketing budget and a new spot from director Spike Lee.

The revived rewards promotion will run in five southeastern states. Under the "Bud Rewards" program, consumers accumulate points toward merchandise by buying Bud family beers and O'Doul's nonalcoholic beer.


A virtually identical promotion, called "Bud Gear," ran last year in California and was temporarily shut down by state regulators who argued it encouraged alcohol consumption (AA, July 7, 1997).

California alcoholic beverage regulators temporarily enjoined the promo last year, saying it violated laws banning giveaways with alcohol sales. But a state court reinstated it, ruling that enforcement of those laws had been inconsistent.

Last year A-B said it wanted to broaden the effort.

A-B wholesalers said the new promotion should draw no fire, noting the brewer received clearance from the necessary regulators. "Most all of the questions and the no's were addressed in the states," said one wholesaler. A-B "met all the restraints."

The brewer declined comment.

In order to not directly tie the contest to beer consumption, A-B is including O'Doul's in the push and is allowing consumers to purchase points toward merchandise, wholesalers said.

Advertising behind the effort breaks next month and kicks off with a TV ad directed by Mr. Lee and produced by his 40 Acres & a Mule Filmworks, New York. DDB Needham Worldwide, Chicago, is the agency for the effort, which features "Baywatch" star Carmen Electra.


The new promo is running through October in Florida, Georgia, Tennessee and North and South Carolina, all markets where A-B commands more than 50% market share, according to industry magazine Market Watch.

The promo fits into A-B's ongoing efforts to build its core Bud brands, particularly flagship Budweiser. Budweiser sales fell 0.6% in 1997 to 36.1 million barrels, the brand's best showing in years, according to Market Watch. Growing Bud's flat sales is a major focus at the brewer.

Bud Light sales shot up 10.6% to 22.9 million barrels, but Bud Ice slipped 7.3% to 1.5 million barrels, according to Market Watch.

Ms. Electra is not the only female celebrity who will be appearing in a Bud ad. DDB Needham last week shot a Bud Light ad featuring Cynthia Cooper, star player for the Houston Comets of the Women's National Basketball Association.

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