Grab Your Pedometer and Let's Go for a Beer

MGD 64 Co-opts Michelob Ultra's 'Active Lifestyle' Positioning in Low-Calorie Brew Battle

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CHICAGO (AdAge.com) -- My beer's healthier than yours.

That's more or less the tactic being employed by MGD 64 as it turns its guns on 95-calorie Michelob Ultra.

Ultra has worked for years to position itself as an "active lifestyle" beer for the athletically minded, going so far as to ink a high-profile endorsement deal with cycling legend Lance Armstrong and launching a Facebook app that locates running and cycling paths. In its new campaign from Publicis' Saatchi & Saatchi, MGD 64 takes a similar tack, launching a branded pedometer app that uploads users' total steps into Facebook group challenges such as "Walk Up Mount Everest 64 times." (And before you make any jokes about how the pedometer totals would be inflated by users not walking in a straight line and therefore getting a few extra steps, consider that MGD 64's alcohol by volume is a meager 2.8%, while Michelob Ultra's is a more typical 5%.)

The brand also boasts a "calorie counter" app that compares its calories to Bud Light, Michelob Ultra, white wine, margaritas and other beverages. There is one notable, and purposeful, exception: Budweiser Select 55.

Many beer-industry watchers assumed that Anheuser-Busch's 55-calorie brand would lead to the demise of MillerCoors' MGD 64. After all, the 64-calorie brand was introduced in late 2008 with a campaign from Omnicom Group's Momentum Worldwide, St. Louis with a single selling point -- "as light as it gets" -- and there was now a contender with nine fewer calories. Yet three months into Select 55's national rollout, MGD 64's retail sales were up 17% through March 26, according to SymphonyIRI.

Source: A-B InBev, MillerCoors

Moreover, those gains haven't come at Select 55's expense. The fledgling brand, which calls itself the "lightest beer in the world," sold 321,000 cases in the four weeks ending March 26, nearly as much as the 388,000 MGD 64 sold despite its more than full-year head start in the marketplace. That left as a convenient target Michelob Ultra, which sold nearly four times as many cases as MGD 64 in the most recent four-week period. Michelob Ultra is handled by Havas' Palm and Havas, Chicago.

"It's a fight we believe we can win," said Sharon McLenahan, MillerCoors' senior director-heritage brands, of the decision to target Michelob Ultra instead of Bud Select 55. Thus far, at least, it seems to be faring reasonably well in that battle, as Michelob Ultra sales have declined 2%.

Cannibalization has been a major issue for MGD 64, which has clearly hurt Miller Lite since its launch, according to Benj Steinman, editor of Beer Marketer's Insights. He notes that before MGD 64 came along, Miller Lite was the most calorie- and carb-counting-focused of the three major light-beer brands in its marketing, selling points it has sacrificed to its new sibling. Cannibalization "remains a major concern," he said.

Nevertheless, Mr. Steinman said the trends for the superlight category were impressive, given a history of misfires in the space, including a 64-calorie version of Beck's that got little traction and, during the late 1980s, the ill-fated Bud LA (which featured George Burns in ads). "These are certainly faring a lot better than what came before them," he said. "[The category] may have legs."

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