Navigating the Beer Industry’s Crossroads: Balancing Erosion and Growth

By: Gabriela ‘Gaby’ Alcantara-Diaz, Founder, President of Semilla Multicultural, Inc.

In the realm of corporate America, the interplay between brand erosion and growth is an intricate dance that shapes the journey of iconic names like Budweiser and Bud Light. As we ponder the ever-evolving beer landscape, a powerful lesson surfaces — one that underscores the significance of embracing cultural trends for enduring, long-term growth. This perspective resonates deeply, especially for those of us devoted to multicultural communities.

Bud Light, an industry stalwart, confronted significant challenges over time, as brand erosion chipped away at its once unassailable position in the American market. This prompts a pivotal question: Could proactive endeavors in diversity, equity, and inclusion and multicultural marketing have fortified its stature? It’s worth contemplating whether a focus on wider appeal, transcending specific demographics, might have yielded more resilient growth in today’s landscape.

Giulio Lombardi, an analyst at Fitch Ratings, in 2019, inferred: The “monster deal allowed the king of beer to push into fast-growing markets in Africa and away from the U.S., where drinkers are switching to craft beer from mass-market beers like Bud Light and Budweiser. Their market share has been constantly eroding for the past 10 years in the United States” (CNN BUSINESS, “The Budweiser beer empire was built on debt. Now it’s racing to pay it off.”).

However, let’s embrace the panoramic view. While some ascribe market share declines to the brand’s current embrace of the LGBTQ community, it’s pivotal to acknowledge that Bud Light’s challenges emerged two decades prior to this issue. This nuanced perspective paints a richer picture of the intricate dynamics at play.

Central to the equation lies the delicate equilibrium between nurturing core consumer bonds and broadening market reach to novel audiences. Bud Light’s story embodies the skill of deciphering this intricate choreography, where brand erosion and growth coexist harmoniously. The essence of the lesson: Staying attuned to evolving values, through cultural trends, fuels the enduring vitality of a brand.

Broadening market research with diverse segments, however, can be tricky business. Especially given today’s culture wars, as Budweiser learned when it recently faced a conservative backlash over a campaign with transgender influencer Dylan Mulvaney. As multicultural marketer David Morse notes, “The good news is that younger consumers are themselves multicultural, not to mention that they have more accepting sensibilities. Successful marketers are the ones that recognize the changing sensibilities in America.”

Ultimately, the intricate interplay between brand erosion and growth resides in the discovery of new drinking occasions and new consumers, all while respecting and venerating both under a singular, unified brand essence. This, indeed, is the symphony where the heart of corporate accomplishment resonates — the symphony of embracing change without forsaking the very essence that defines a brand.

Cultivating meaningful brand growth hinges on embracing evolving sensibilities, respecting diverse perspectives, and weaving these threads into the intricate fabric of a brand’s journey.