Anheuser-Busch adds two brands with punch

bud, beck's names boost allure

St. Louis Post-DispatchJanuary 19, 2013 

BIZ ANHEUSERBUSCH 8 SL

Beck's Sapphire beer will have 6 percent alcohol by volume, up a tick over the main brands.

CHRISTIAN GOODEN — MCT

Two new beers rolling off Anheuser-Busch's production lines in St. Louis carry brand names with a familiar ring.

Tapping into the power of the Budweiser and Beck's names, the company is offering variations that have higher-alcohol content: Budweiser Black Crown and Beck's Sapphire.

The brewer is betting that the flavor variations with higher alcohol content and new designs will boost the two brand families' allure among U.S. drinkers.

"We have American iconic brands and brands that have been part of the brewing tradition going back 800 years," said Paul Chibe, A-B's president of U.S. marketing. "That gives us a great opportunity to deliver on consumers' needs."

The two new beers have 6 percent alcohol by volume compared with 5 percent with the main brands, a new feature clearly aimed at the U.S. market. Even though Beck's is the world's most popular German beer brand, Sapphire will only be sold in the United States.

"The higher (alcohol content) provides a taste portfolio consumers are looking for, which we know from testing," Chibe said.

The higher-alcohol beers come on the heels of Bud Light Platinum, a 6 percent alcohol beer A-B introduced in January 2012 that quickly gained market share.

The launch of Budweiser Black Crown comes as Budweiser, while growing in foreign markets, continues to see domestic sales declines — dropping 7 percent in the United States in its third quarter.

Yet the play is not without risk. Offering another brand extension poses the threat that regular Budweiser could lose shelf space, further deteriorating sales, said Bump Williams, CEO of consulting firm BWC Co., an adviser to beer retailers and distributors.

"There's not a doubt in my mind that wholesalers will have Budweiser Black Crown everywhere overnight," he said. "My concern is: Where is that shelf space going to come from?"

A-B's newest products are part of the company's push to offer more options at higher price points, said Thomas Mullarkey, an equity analyst with Morningstar.

"It goes along with a long-standing trend of American consumers drinking more craft-type beers and higher-end beers," the analyst said. "They're catering toward the demographic that wants to try what they perceive to be higher-quality beers. It will fill a niche for people who want to experiment with their beer, but with a brand they're familiar with."

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