Bud Light Seltzer Should Score With A Sports Asset Focused Campaign

BY ADAM GROSSMAN

Anheuser-Busch InBev (AB InBev) announced that it will launch Bud Light Seltzer in January of 2020. Vice President - Partnerships, Beer Culture & Community Nick Kelly highlighted the company’s commitment to using sports assets as key part of the initial campaign earlier this week. In addition to significant Super Bowl spend, Kelly states, “We’re flipping every switch we have to give Bud Light Seltzer the runway it needs to build awareness fast. We will leverage all our assets from January into April, including NBA, NHL and MLB. Every piece of TV-visible signage, including outfield wall signs, will be for Bud Light Seltzer.”

 A sports-based strategy has driven tangible success before for AB InBev. In a previous post, we highlighted research on Super Bowl ads that showed that Budweiser saw a statistically significant increase in sales in the week prior to the Super Bowl and generated $45 million in direct revenue from ads during the game. Budweiser also achieved a statistically significant increase in sales in the 8-weeks following the Super Bowl when it was the sole or primary advertiser.

Bud Light Seltzer should potentially achieve greater revenue lifts for both intuitive and non-intuitive reasons. Kelly states that one of the key goals of the campaigns is to “build awareness fast.” While achieving year-over-year revenue growth of 202%, hard seltzer products peaked this summer at 5% of beer market share. This helps to show that hard seltzer as category still has relatively small awareness with potential consumers. Even with this relatively low awareness, Bud Light Seltzer will be a late entrant to a category that already contains White Claw, Truly, Bon & Viv, and Natural Light (the later two are owned by AB InBev).

B6A’s research using our Media Analysis Platform and Corporate Asset Valuation Model (CAV) has found that television ads and tv-visible signage are particularly effective at driving brand awareness. Our CAV research has also shown lifts in brand awareness (in addition to brand sentiment) have a strong and statistically significant correlation with increases in the likelihood of revenue growth for the beverage category.

Generating lifts in brand awareness, however, is not the only reason that sports assets are a good fit for Bud Light Seltzer. While the hard seltzer category growth at this scale is new, the product itself has been around since at least the 1990s. One of the reasons that past products, such as Zima and Smirnoff Ice, did not achieve long-term success it that they “suffered from the stigma of being drinks that mostly women would prefer, rather than men.”

Once could argue that a female-focused “stigma”, even in the 1990s, should not be a key reason for a product not achieving success. Even that stigma, however, is now contradicted by the data. More specifically, White Claw states that its customers are “fairly” evenly split between women (53%) and men (47%). Our research (seen in a table below) shows that males may even make up a larger percentage of White Claw’s consumers in the future.

Even if gender did (or should) not have played a role in past failures of hard seltzer products, one reason for their current success is that hard seltzer typically contains lower calories and carbohydrates than beers and even many light beers. This is critical because as both male and female beer consumers are more concerned with nutrition generally and calorie and carbohydrate counts specifically than in years past.

This new focus on “calories and carbs” has been cited has one of the key reason for the decline of beer-specific sales. In addition, research has shown that higher income demographics spend more money on nutrition-based, healthier purchases making them a prime target demographic for hard seltzer products.

 Analysis from our Audience Inference Platform (AIP) demonstrates that AB InBev’s strategy should disproportionally reach male, high-income audience that can help Bud Light Seltzer’s growth. The AIP uses natural language processing (NLP) to read the posts of followers of specific accounts and compare what they are saying to to a large data set with known audience profiles to determine demographics. The table below shows the audience composition by percentage across six categories.  

The table above provides further support AB InBev’s strategy. Leveraging sports, particularly TV-based, assets will enable Bud Light to generate lifts in brand awareness while also disproportionately targeting demographics that should lead to new sales growth. Using technology and date to drive insights that show how corporate partners can maximize success with sponsorship / media spend should in this way be a key strategic tool for anyone working in the sports industry.