×

Once registered, you can:

  • - Read additional free articles each month
  • - Comment on articles and featured creative work
  • - Get our curated newsletters delivered to your inbox

By registering you agree to our privacy policy, terms & conditions and to receive occasional emails from Ad Age. You may unsubscribe at any time.

Are you a print subscriber? Activate your account.

U.S. WARMING UP TO ICE BEERS A-B, MILLER BREWS ALREADY NEARING 2% SHARE

By Published on .

The beers that made Canada famous are fast becoming favorites in the U.S.

Ice beers have captured nearly 5% of the market in just nine months, during a time when new brews have had trouble winning significant approval and the market itself has been stagnant at best.

"People are looking for a brand with a little more kick," said Jerry Messner, sales and marketing director for Lodge Management Group, operator of five large Chicago bars. "There's a lot of money being thrown around in advertising and people are responding."

So far, about $15 million to $25 million is being spent on marketing ice beers.

The growth is especially surprising considering the beer industry's last experience with a product under similar circumstances-dry beer. With considerably heavier advertising, dry beers came in 1989 and for the most part went, with little staying power.

"No one knew what dry meant and there was no visual with dry," said Manny Goldman, an analyst with PaineWebber, San Francisco. "In the case of ice beers, it is easy to have a visual."

Ice beers' supermarket success has been considerable. In a category that had no brands last year at this time and where several are still moving to national distribution, Ice Draft From Budweiser and Miller Lite Ice are already approaching the industry's traditional definition of success for mainstream products, a 2% share.

In addition, Miller Brewing Co.'s Icehouse has nearly a 1% share. Miller's third ice, Canadian import Molson Ice, has a 0.6% share for the 13 weeks ended July 9, according to Nielsen Marketing Research.

"It's viable and way different from dry," said Victor Dzenowagis, director of new products at Stroh Brewery Co., which now has Schlitz Ice, Schlitz Ice Light beers and a Bull Ice malt liquor and is launching Old Milwaukee Ice. "When Molson Ice came to Detroit [Stroh's home] we waited a little bit, but everything we heard was there was something here, whereas when we looked at dry beer there was nothing there."

Brewers see the ice segment as continuing to grow, though they caution it will never be as large as light beer. The result is a flood of new ice products from virtually every major brewer, and jockeying for position. One brewer last week estimated more than 40 ice beers are now on the market or being readied for sale.

Miller contends Lite Ice will soon pass Anheuser-Busch's Ice Draft From Budweiser as the largest of the ice beers. The brewer also plans to expand Icehouse, handled by Young & Rubican, Chicago, from bottles only to a full range of packaging, and line extensions are possible.

A Miller trade ad breaking next month notes that Icehouse will outsell Labatt Brewing Co.'s Rolling Rock and Boston Beer Co.'s Samuel Adams combined this year.

The Lite name gave Lite Ice instant credibility, said Scott Barnum, Miller's premium brands franchise director.

Lite Ice recently launched a new TV and radio ad campaign from Bates USA, New York, using a "Field of Dreams" theme together with a "Some people get it" tagline.

"We see the category continuing to grow, perhaps not at the same rate as it has been," he said.

Mr. Barnum contends Lite Ice is attracting entry level drinkers as well as Budweiser family drinkers and some from other Miller products.

A-B, however, suggests most of Lite Ice's volume comes from other Miller products and says Lite benefited from Miller's strength claims, which have now been disallowed by the U.S. Bureau of Alcohol, Tobacco & Firearms.

A-B's product, which is called Bud Ice in the latest spots from DDB Needham Worldwide, Chicago, has an alcohol level similar to normal beer.

A-B complained to the BATF about Miller advertising the percentage of alcohol in TV spots, and about cards Miller distributors had passed out comparing the strength of its ice beers to other brews. Most ice beers have 5.5% alcohol, compared with about 5% for regular brands.

"I don't think the alcohol [content] game will play out in the long term," said August A. Busch IV, VP-brand management. "It could give the industry a real black eye."

Mr. Busch said the number of competitors is helping to fuel category volume growth.

"We were first in the market place and we didn't expect as many competitors," he said. "If everybody stays in the game, it will grow further."

A-B last week completed its national rollout of Ice Draft Light.

Other brewers including G. Heileman Brewing Co., S&P Corp. (Pabst and Pearl Brewing) and Genesee Brewing Co. (Genesee Ice) have also been pushing ice beers.

Most Popular
In this article: