Beer Marketer's Insights
AB Rev Per Bbl Up 3.8%; STRs Up 2.1%
August IV Is Named Prexy of Brewery
The baton is passed and August IV has arrived at the top as prexy of brewing co at age 38. August III named chairman of the board, reducing his role at age 65 as he said he would. And Pat Stokes, 59, named prexy/ceo of all Anheuser Busch Cos. That's gist of big mgt changes going into effect July 1 announced this morning at AB shareholder meeting. After 25 yrs as prexy/ceo, “it’s time for me to step aside,” August III told shareholders, adding that he is “happy, full of energy” and “young-at-heart.” Said board asked him to continue as chairman for 5 years. More in Beer Marketer’s INSIGHTS.
The Way We Were
Coors prexy Leo Kiely had good response when asked at last weeks’ conference call whether new Coors Light ads “resonating” with consumers just older than the 21-27 yr-old target: “All I’ll say is that thank God all men think that they’re 22 yr-olds. I don’t know how women think and I’ll never figure it out.” “Best test,” Leo added, was “incredibly positive” distrib reaction so far. Another Leo view: malternatives will be a "niche in the category,” but “it isn’t going to replace the sort of ‘rite of passage’ role of beer for young adult males.” Even in UK where ready-to-drinks bevs doin’ well for “younger crowd,” for 21-25 yr-old males, “beer is the game.”
Freddy Heineken’s daughter, Charlene de Carvalho, said last week that Heineken family saw itself as “past, present and future” of Heineken, “fully sharing my father’s commitment…. As a family, we share the aspirations and ambitions of this company,”she said, according to Financial Times. While analysts “view the family’s reluctance to dilute its controlling interest…as potentially restricting its ability to participate in global consolidation,” according to FT, ex-Heineken chairman Karel Vuursteen said it had other forms of “creative financing” it could use. Cited almost $1 bil cash and debt capacity of nearly $4 bil or a share issue. Karel even named Molson as potential takeover candidate, tho he added: “It is not for sale, but we can wait.” Meanwhile, interesting to note that top execs of world’s 2 most profitable brewers stepping down at nearly same time.
Miller/Coors guys could find themselves with 7+ by fall, noted Deutsche Bank analyst Marc Greenberg, following his attendance at same 4-state distrib conference (see above). Named 4 from Miller (with 3 different distillers), 2 from Diageo, 1 from Coors (Vibe). Didn’t even mention Mike’s and/or Zima. “Many Miller wholesalers noted the difficulty going to retail with so many products and worry about the…effect on Miller’s core brands,” he wrote, “which are now resuming favorable trends.” Marc also said: “Miller distributors are wary of a South African Breweries takeover.”
Blurring Lines and Clout in the House
There is “a likely reality” that the “beer, wine and spirits business is fast-folding into a larger drinks industry,” consultant Mark Rodman told 4-state distrib meeting last week (Pennsy, Md, Del and NJ) in provocative speech. Takin’ out his crystal ball, Mark said this points to “a reconfiguration of the entire beverage business to give suppliers more clout in a house. With more clout,” Mark continued, “comes the capacity to grab a greater share of the profit centers of the middle-tier…. What brand owners demand is more of the profit pool. Heaven knows they’re not going to get it from the power-buying retailers,” like Wal-Mart. Mark pointed to Diageo’s current push to get more exclusive distribs, and postulated that other distillers/vintners would align with beer cos (including AB) for larger, blended distribution networks.
Top Brands in Big Metro Mkts Last Yr
Ebony mag put out its list, which included Colin Powell, Condolezza Rice and yup, Maris atty Willie Gary, whom Ebony referred to as “one of the wealthiest and most successful attorneys in the country.” At time of verdict, Willie had talked of other distribs seeking his services; nothing has surfaced so far. At AB stockholder meeting last week, AB chairman August Busch III declined to comment on Maris trial because it’s “still in litigation.” Meanwhile, Jesse Jackson, whose son Yusef owns an AB distrib, is friendly with Willie. In fact, Willie served as his atty in suit filed by Jesse’s mistress, according to bestseller Shakedown.

