Patriotism Still Plays (and Pays Off) for A-B, MillerCoors

Beer Giants Bet Consumers Still Find Brews as American as Apple Pie (They're Right)

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Budweiser's patriotic can
Budweiser's patriotic can

When foreign-owned InBev took over St. Louis-based Anheuser-Busch three years ago, some prognosticators predicted the demise of the patriotic-infused marketing that had long been linked with Budweiser. After all, how could a Belgium-based brewer run by Brazilians drape the King of Beers in stars and stripes?

"It could be a disaster," one ad agency executive told Ad Age as the $52 billion acquisition was about to close in summer 2008.

But it wasn't. Bud is still coloring itself red, white and blue, and consumers don't seem to mind. Consider the brand's newest promotions: limited-time American flag-styled cans debuting on Memorial Day and a nationwide happy-hour event on Flag Day to promote its new veteran fundraising program.

"The average consumer has a short memory," said Harry Schuhmacher, editor of Beer Business Daily. "The fact that Anheuser-Busch was bought by a foreign company was all over the news ... but then it died down and people went about their business."

It was not all that long ago that A-B railed against the "foreign interests" that controlled competitors such as Miller, which was acquired by South African Brewers in 2002 and later joined with Molson Coors to create MillerCoors in the states.

A-B faced an immediate backlash as its merger closed, including protests from a website called SaveAB, which promised to "fight the foreign invasion." But as author Julie MacIntosh recounts in her book "Dethroning the King," lobbying efforts were soon overshadowed by the building financial crisis. "People were too distracted by the credit-crunch-related turmoil in their own lives to care about whether Budweiser was brewed by an American or Belgian company," she said in the book.

And patriotic plays only go so far, experts said. "Consumers drink beer, they don't obsess over who owns what," said beer historian Maureen Ogle. She admits to being upset when InBev bought A-B, but then "once the emotion was over, well, life goes on."

The fact is the American brewing industry today is dominated by foreign interests. A-B and MillerCoors together control 78.4% of the U.S. market, according to Beer Marketer's Insights. The largest U.S.-owned company that makes and sells beer in the States is Rochester, N.Y.-based North American Breweries, which has 1.2% share with brands such as Genesee and Magic Hat. (The brewer is owned by a private-equity fund, KPS Capital Partners.)

Still, the foreign-owned big boys are upping their patriotic appeals this summer.

Miller High Life is continuing a program started last year that donates 10 cents to Iraq and Afghanistan Veterans of America for every specially marked bottle cap returned. The initiative last year raised $1 million that went toward sending vets on "High Life" experiences, such as an Alaskan fishing trip. This year, the brand is breaking out cans featuring a yellow ribbon on the back. It's also running a new TV spot to promote the program. The brand's agency is Saatchi & Saatchi, New York.

A-B, meantime, this year began donating $100 for every Major League Baseball home run to the Folds of Honor Foundation, which provides scholarships for families of military members who are killed or disabled. Bud is also donating a portion of sales from May 26 to July 10 to the organization. All this is backed by an ad by Bud agency Anomaly featuring a soldier returning home from war.

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