Budweiser, a brand of Anheuser-Busch, has allegedly lost around 6 to 3 billion in value since Bud Light’s controversial partnership with Dylan Mulvaney, a transgender activist and social influencer. Despite these claims, the stock price of Anheuser-Busch InBev (BUD) does not appear to reflect this decline, leaving many wondering why.
According to Beer Business Daily, some AB InBev distributors in the Heartland and South experienced volume declines in the holiday weekend due to the negative consumer reaction towards the Mulvaney campaign. This cautious approach from the distributors is crucial for Ball Corp. (BALL), which relies heavily on AB InBev as it made up 13% of Ball’s sales in 2022. In light of this issue, Ball is predicting flat-to-slightly down North American volumes in 2023, which could be further pressured if this issue persists.
Truist analyst Michael Roxland says that the negative consumer reaction towards the Mulvaney campaign is causing distributors to be increasingly cautious. He adds that this issue may affect Ball’s sales volume, and therefore, recommends a Hold rating on the shares with a $58 price target.
The alleged market share losses and distributor caution have raised concerns about the impact of controversial marketing campaigns on brand reputation and sales. This event serves as a reminder that brands must carefully consider their marketing strategies and the potential reactions of their customers before launching a campaign. It is crucial to seek the opinions and feedback of loyal customers to gauge how they would react to the campaign and avoid negative associations and backlash.
Bud Light and Dylan Mulvaney partnership has allegedly caused Budweiser to lose billions in market shares and AB InBev distributors to exercise caution. This event highlights the importance of considering the potential impact of a marketing campaign on brand reputation and sales, and consulting with loyal customers before launching a campaign. By doing so, brands can ensure that their marketing strategies are well-received by their target audience and avoid any negative consequences.