Wednesday, February 27, 2019
Major brewers and packaged good marketers in the US are facing a conundrum. Consumers are passing them by and buying other products off grocery shelves and from liquor stores. Sales of Budweiser, particularly, have stalled. Anheuser-Busch is working frantically to turn around. The company is being assaulted by thousands of craft breweries whose production is a fraction of what the A-B produces, but each one is a small slice into its sales and combined, a large cut. It's facing "brutal facts" and developing beverages that might meet the demand of today's millennials. The American consumer's tastes have changed, maybe for good, but A-B is configured to produce millions of gallons of high-quality beer a year. It can't easily switch off bottling lines without sustaining huge losses. The company is not nimble after decades of dominating beer sales. The same problem is facing Kraft-Heinz. Both companies have entered a marketing/PR hell, and it might take them years before they leave it, or like many retailers savaged by Amazon, they might just fade away.