The CMO Interview: Dave Peacock

Dave Peacock on Bud's New Owners and the Great American Lager

A-B's Top Marketing Exec Also Explains Why He's Not a Liquor Guy

By Published on .

What's new at Anheuser-Busch this year?

Oh, not much -- other than being bought by Belgian-Brazilian brewer InBev; seeing its two largest U.S. competitors merge; and accelerating its transition from an old-school purveyor of a few massive brands to a company with a full-scale portfolio that includes dozens of niche, import and specialty labels.
Anheuser-Busch VP-Marketing Dave Peacock
Anheuser-Busch VP-Marketing Dave Peacock

Despite all that, VP-Marketing Dave Peacock -- a 17-year A-B veteran who took the reins of A-B's $1.3 billion marketing machine last fall, having previously been the brewer's VP-operations -- helped steer the brewer to a successful summer selling season, thanks to the expectation-surpassing launch of Bud Light Lime and the brewer's increasing agility at balancing the demands of selling huge-volume brands such as Bud Light alongside crafts and imports.

Ad Age caught up with Mr. Peacock moments after his speech on -- what else? -- change at the recent National Beer Wholesalers Association convention in San Francisco.

Ad Age: How does having a competitor of significantly larger scale, as you now do in MillerCoors, complicate your job?

Mr. Peacock: It probably complicates their job more in the short term, because integrating portfolios, beyond all the stuff with the sales force and the wholesale level, if all of a sudden we were selling -- say we were selling Bud Light all these years and then we suddenly had Budweiser as a new product, marketing [two similarly positioned brands] would represent its challenges.

Ad Age: How would you handle the challenge of having Miller Lite and Coors Light in the same portfolio all of a sudden?

Mr. Peacock: Thank God I get to market Bud Light and Budweiser and Bud Light Lime and Bud American Ale. We have our own set of challenges. I'll let them figure out how to do it.

Ad Age: Well, that is a lot of Buds. Given the success of Bud Light Lime's launch, do you guys have a sense of how often you're going to be rolling out new extensions?

Mr. Peacock: We're not going to roll one out all the time so that all of the sudden there are 20 brands in the Bud Light family. You literally have to let the consumer lead you and guide you through the research we do. We're trying to understand where the gaps are in what's available to consumers and whether we can fill it in a way that's relevant within that megabrand position. Eventually you get to a point where you've probably filled a lot of the gaps that make sense for your megabrands. For instance, a Bud Light Shock Top-type product would never fly.

Ad Age: So you could do an ale but not a Belgian white with Bud?

Mr. Peacock: I don't know. We want to launch fewer products than we did two or three years ago, but we want to have greater confidence in their success. Bud Light Lime is an example. It's basically an eight- or nine-step process of innovation. But we rolled it out, as you know, with a significant investment starting in the Final Four because we had all the confidence in the world it would be successful. And that confidence came from the research we did with the consumer.

Ad Age: What about Bud Light, your biggest brand? You've had a few agencies doing a bit of a rethink on it in the past of couple months. Where are you with that now?

Mr. Peacock: There's going to be new work coming out in October [primarily from DDB, Chicago] with a $50 million investment behind it. We're going to start talking a lot more about product benefit. That's something we heard a lot from the consumers, and the word that came back from them was "drinkability." Basically what that is is consumers telling us that we're kind of the perfect balance among the major light beers -- not too watered down but also not as harsh or heavy with an aftertaste, so the brand is really drinkable. But we're going to do it in a Bud Light way, with a lot of humor. You don't want to change the personality of the brand at all.

Ad Age: Anything you can tell us about how you're going to do that?

Mr. Peacock: They just shot it, so I haven't seen it yet. ... But you know how this stuff gets made. Dan McHugh [Bud Light's senior marketing director] always says, "Sixes, eights, 10s." Look at the recent Budweiser work. The first ads with ["Daily Show" correspondent] Rob Riggle were OK. The message was good. Then we gravitated to a female, because we didn't want one spokesperson for the brand. We put some new music to it, we added some energy, which was better. Then the next round it was even better. As you know, with the creatives, once they sink their teeth into a campaign, the iterations almost always improve over time.

Ad Age: Looking at the InBev deal, one marketing challenge that's been discussed a lot is the prospect of Budweiser being under foreign ownership. It's the "Great American Lager" positioning, and you've sort of doubled down on that with the recent launch of Budweiser American Ale. Is it harder to be so overt with the American angle now that you're going to be foreign-owned?

Mr. Peacock: No. We've looked at some work that talks about "Born here, brewed here, enjoyed around the world." And I've had some consumers and even wholesalers come up to me and say, "Well, it's foreign-owned now." And I say, "You know, the best way to protect American jobs is to continue to buy Budweiser." It's going to continue to be brewed at the same breweries where it's been brewed before, with the same process as it's been brewed before. And the "Great American Lager" [positioning] does not change, because it is the great American lager.

Ad Age: During your speech to the NBWA, you talked about being "impressed as hell" with your new bosses. What have you seen from InBev since the deal happened that's been so impressive?

Mr. Peacock: They're very disciplined. They've got an aggressive, competitive orientation. And they're very pragmatic and look to simplify complex issues. Above all, they're a learning culture. They have specific ideas on things, but they're open to changing.

Ad Age: Is there something specific where you've persuaded them to change their minds in the brief time you've been dealing with them directly?

Mr. Peacock: I don't want to get into specifics, but there are certain areas in some of the integration planning where they're seeing some of the ways we do things and looking at maybe adopting forms of those. And then, clearly, we've seen a lot of what they do and have been very impressed about how they run a business and the discipline that they apply to a business.

Ad Age: You have been dabbling more in spirits, picking up a number of boutique brands. But in your speech to the NBWA, you called wine and liquor "the enemy." You said specifically that you could not be "outromanced by wine" or "outfunned by liquor." Those didn't sound like the words of someone who wants to play in that space.

Mr. Peacock: We started looking at liquor and wine a long time ago because of the emerging macro trends [of wine and liquor gaining share from beer]. And we really did believe we owed it to our shareholders to do this [because of consumer trends increasingly favoring spirits]. We tested some things in liquor. But we started making the decision back in the first quarter of this year that we were probably going to disentangle that. It didn't work really well at the wholesale level. Those brands are marketed very differently than beer. The category is much more fragmented. And, frankly, we see upside in beer. We've seen beer have a little bit of a resurgence.

Ad Age: So you see a huge difference even from the upscale, hand-sold brands such as Stella?

Mr. Peacock: Yeah. It's a big enough difference, with all the state regulations, that other people are going to do it better, and other people are going to play in that game. The game we're in, one, I think we're winning, but, two, it's a healthy industry.
Most Popular
In this article: