Budweiser's "super-calculated" Super Bowl sidestep
For the first time in 37 years, the King of Beers will skip the Big Game. But what does that *mean,* exactly?
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You won’t see the Budweiser Clydesdales during tomorrow’s Super Bowl—not on your TV broadcast, at least. The King of Beers has opted against running an ad during tomorrow’s Super Bowl LV, marking the first time almost four decades that the brand will sit out the nation’s premier advertising event. Instead, it will donate several million dollars to nonprofits conducting coronavirus vaccine awareness and education campaigns.
You probably already know this, because mainstream media covered the absolute shit out of Budweiser’s decision. Your Fingers editor isn’t going to aggregate all the positive press hits here, but CNBC’s framing of the “no Bud ad” item is pretty characteristic: “Budweiser will sit out Super Bowl, funneling marketing dollars to boost vaccine awareness”.
Let’s get the obvious out of the way up front: this is a net good. Nearly a year into a deadly global pandemic that the U.S. government has handled with a mix of grotesque disregard, spectacular incompetence, and obscene corruption, anyone willing to help grease the wheels on this country’s chaotic, underperforming, inequitable vaccine rollout should be commended. No, promoting “awareness” is not the same as “inserting syringes full of COVID-19 antibodies in people’s arms.” But considering a December 2020 Pew Research poll found that 39% of Americans “probably would not get a coronavirus vaccine,” there’s clearly a need for more education and, yes, awareness about the importance of a vaccinated population.
So, I applaud Budweiser’s donation for what it is: a few million in the right direction.
And yet… it feels a little wrong to uncritically congratulate the flagship brand of the world’s largest beer company for a corporate-citizenship exercise that yielded a week of fawning PR, doesn’t it? If your answer is anything other than “you’re right Dave, it really does,” then you, my friend, are reading the wrong boozeletter, and I encourage your swift departure for safer harbors. The nearest exit may be behind you, please recycle your 3D glasses in the lobby, et cetera.
OK, now that all the credulous brand-humpers have left, let’s dig a little deeper into Budweiser’s no-ad call: how much they actually donated, what it actually means in context, and what signals it sends about the Americana brand’s domestic importance to the cost-conscious Brazilian brass at Anheuser-Busch InBev.
What, you didn’t think Fingers was going to let the King of Beers take a humanitarian victory lap without a little scrutiny, did you?! On we go.
Details on the donation
First thing’s first: the money. Budweiser says it will donate $1M to fund the nonprofit Covid-19 vaccine education efforts by the nonprofit Ad Council and the COVID Collaborative, a coalition of public health efforts. Per the Wall Street Journal, the company “will also produce multimillion-dollar vaccine awareness efforts throughout the year.” This contribution is being variously described in reports as a donation of Budweiser’s ad inventory (i.e., they donate airtime they already bought), and a reallocation of the cash it had budgeted for this year’s Super Bowl spot.
Are we going to see an Ad Council-created, Budweiser-backed vaccine spot during tomorrow’s game? Seems doubtful. ABI’s PR team did not respond to my questions about this or anything else, so I guess we’ll find out together tomorrow, reader!
Super Bowl ads cost… uh, more than $1M
According to Gannett torture victim/hotel doormat/somehow still-legitimate publication USA Today, the going rate for a 30-second national spot in this year’s Super Bowl is between $5.5-$5.6M. Assuming Budweiser was going to run a single, national, half-minute ad, that means that its donation to the Ad Council (either cash or in-kind) is less than 20% of what it probably would’ve have spent on airtime during tomorrow’s game. Huh!
Take another step back, and that $1M gets even smaller. After all, as Boromir once famously told Elijah Wood, “one does not simply buy a Super Bowl spot.” Companies pony up tons of dough to reserve airtime during the game, and then spend millions more to produce the actual content that will run in that slot. Your Fingers editor is told (from someone who would know) that a Super Bowl ad with high-profile talent shot over two days with solid video FX would go for around $2M these days. (Last year, TheStreet reported a more conservative, still eye-poppingly expensive production estimate of $750,000 for a 30-second slot. But their source was the CEO of ScanMyPhotos.com, and after glancing at their website, I’d say that figure represents some pretty, ah, lo-fi production values.)
Plus, a big brand like Budweiser wouldn’t spend all that money just to produce one 30-second ad and throw it willy-nilly onto your teevee. For beer brands, Super Bowl spots are an important way to of create momentum that builds towards the all-important Memorial Day-to-Labor Day summer stretch, when beer sales are traditionally the highest. That means a Budweiser Super Bowl ad could’ve been the kickoff for an integrated campaign with complementary digital, print, streaming, and outdoor (billboard) strategies, social media tie-ins, events… you name it. All that costs more than $1M to orchestrate—a lot more.
“Using the conversation and the ecosystem”
It’s true that Budweiser isn’t going to run a Super Bowl ad this year about Budweiser. But that doesn’t mean it’s not going to run an ad, period. Shortly after announcing its plans to end the flagship brand’s Super Bowl ad streak at 37, the brand was out with a 90-second, digital-only spot touting its own decision. Titled “Bigger Picture,” the ad is an absolute tearjerker narrated by actor Rashida Jones that showcases American resilience and courage and so forth. It closes with a serious note about “redirecting its advertising dollars” and an optimistic sign-off: “See you at the game next year.”
The video was published to YouTube on January 25th and has already clocked 11.2M views on that platform alone, thanks in no small part to the fact that pretty much every outlet covering their decision (including this one!) linked to it. I mean this with all due admiration: it’s fucking scary how good ABI is at manipulating the media. But I’ll ask the obvious questions: how much did this ad about not running an ad cost to produce, and how much did the campaign cost to roll it out? (I asked ABI about this, and I’ll update this post if I hear back.) If the Budweiser’s goal here was truly to empower the Ad Council to increase vaccine education, then wouldn’t all that money have been better spent, uh… actually doing that?
“I think it was a super-calculated move,” said one former ABI marketing employee with deep experience in the beer industry, referring to Bud’s no-ad call. (Fingers is granting them anonymity to speak freely without jeopardizing professional relationships.) “Budweiser was the best brand to do it with, because so many consumers associate Bud with the entire company,” they continued. “Meanwhile they cash in on every seltzer brand (how many do they have now?!) still runnings ads, plus a regional Cutwater ad.”
What’s that? You thought that all these headlines meant ABI’s entire portfolio was skipping Super Bowl LV? No, no, no. Per a company release, six of its beer and seltzer brands will see Super Bowl air: national spots from Bud Light, Bud Light Seltzer Lemonade, Michelob Ultra, and Michelob Ultra Organic Seltzer, plus less-pricey-but-still-pricey regional ads for Stella Artois and Cutwater Spirits (a San Diego ready-to-drink cocktail brand ABI acquired in 2019.)
All told, ABI brands will occupy four minutes’-worth of national Super Bowl ads. I don’t have handy the cost of a 60-second spot (the length all ABI’s national ads will run tomorrow) but it seems reasonable to assume that double the airtime would cost more, right? Assumption aside, even an ultra-conservative back-of-the-napkin calculation using the 30-second price of Super Bowl air suggests ABI’s spent north of $22M for airtime ($5.5M/30-second spot x 4 brands) plus somewhere between $3-$8M on production. So erring on the side of very cheap, ABI’s Super Bowl LV advertising spend probably exceeded 20x the amount that it’s publicly earmarked for vaccine awareness campaigns so far.
But wait, there’s more! Before deciding not to run a Super Bowl LV spot, Budweiser had already produced an ad for it! Variety’s Brian Steinberg reported that “[e]xecutives had a Super Bowl spot ready to go late last year… but decided to pivot.” They already spent the money to produce a Budweiser ad! Add it to the cost sheet!
That tasty corporate-waste tidbit is attributed to Monica Rustgi, Budeweiser’s vice-president of marketing. She also told the WSJ’s Nat Ives:
“We’re still going to reach people during the Super Bowl… It’s just not going to be in the traditional sense. We’re still using the conversation and the ecosystem around the Super Bowl to send a message, but we’re also helping to be part of the solution so we can all enjoy an ice cold Bud sooner or later.
Not to pick on a marketer using marketing buzzwords in an article about marketing, but… do you know what that means? Because I don’t! Based on the company’s stated strategy this year, it’s “using the conversation and ecosystem around the Super Bowl” the way it always does: to promote its brands, including Budweiser, with massive ad campaigns and national airtime. The only difference from the previous 37 years is the token donation to the Ad Council and the Clydesdales’ absence on gameday. (And they won’t even be fully absent: Budweiser is teasing a social-media appearance from the horses on Sunday.) But maybe I’m misunderstanding Rustgi? ABI PR: please answer my email!
On Clydesdales and company culture
Back in 2008, as Belgian/Brazilian beverage behemoth InBev signaled its (eventually successful) hostile takeover on Anheuser-Busch, red-blooded American drinkers balked at the notion of Budweiser falling into foreign hands. Though its sales peaked in the late ‘80s (more on that below), it was still a point of enormous pride amongst the company’s U.S. brewery workers, salesforce, and distribution partners—not to mention virtually all of St. Louis, and most of the country’s drinking public, too.
At the time, then-presidential candidate Barack Obama called the takeover a “shame,” encouraging an American company, any American company, to rescue A-B from the Brazilians and InBev. The brewery—embodied by Budweiser, its flagship—was a potent-enough symbol of American pride that lamenting its corporate capture was simply good retail politics.
A dozen years later, the enemy at the gates isn’t now-CEO Carlos Brito with the carving knife. It’s the coronavirus pandemic. So rather than backlash for depriving U.S. viewers of their cherished cultural touchstone, ABI has mostly reaped goodwill online for axing this year’s Budweiser Super Bowl spot. The press swooned; social media users “liked.” To wit: Budweiser’s Facebook page is an orgy of people “thanking” the brand for “doing the right thing,” mixed in with a few anti-vaxxers and racists angry about the Black Lives Matter nod in the brand’s digital ad. (Hey, can’t please everybody!)
Within the company, though, our incognito pro guessed the cultural impact of skipping the spot was probably more drastic. “It’s sad for a heritage brand,” they said. “I think it hurts people in St. Louis and at the big [ABI] breweries around the US that brew it. Culture in New York [home to the company’s North American sales & marketing teams since 2014] isn’t tied to beer, it’s like any other CPG [consumer packaged goods] company there. And those are the people making decisions.”
To add insult to injury, the first year in 37 that Budweiser doesn’t have a Super Bowl spot is also the year Samuel Adams decided to send-up the brand’s enormous equines in an ad of their own. The Boston Beer Company brand has a 30-second ad, titled “Horses,” that will spoof the Bud icon to viewers in New York and Boston. (For reference, that regional spot will cost BBC a reported $770,000; the much-smaller company, which also makes Truly and Twisted Tea, told WSJ its entire Super Bowl campaign this year will cost $2.5M.)
The ad is part of Sam Adams’ insipid “Your Cousin from Boston” campaign, and showcases not the brand’s flagship but its Wicked Hazy IPA. You gotta figure it’s an extra twist of the knife for any company lifers discontent with ABI’s Super Bowl decision to watching the mighty Clydesdales pose with a knock-off green wagon to sell the trendy ale of the Busch family’s pesky one-time foe, rather than a crimson-red Bud carriage full of their beechwood-aged lager. How times have changed.
C-suite vs. sacred cow?
One more thing. Industry heads know that nothing was the same when A-B became ABI post-2008. The resulting leviathan quickly became notorious for penny-pinching at odds with the Busch family’s multi-generational noblesse oblige approach to running a beer business.
The Busch Gardens amusement park business quickly hit the auctioneer’s block; the company started paying suppliers net-120 instead of net-30; its new CEO eschewed corporate perks, even skipping the private jets to fly commercial. (Not always, though.) The company culture changed, and nothing was sacred. Except, maybe, for Budweiser itself.
Bud became ABI’s global flagship post-merger, but it had been in trouble since long before InBev took over. Its volume peaked in 1988 around 50M barrels, and it’s been sliding ever since. Bud Light overtook it as the most popular beer in the country in 2001; then came Coors Light and Miller Lite. In 2019, Budweiser shipped just 10.6M barrels. Yes, with ABI’s global footprint and expertise, Budweiser has gained some market share on foreign shores since the takeover, particularly in Asia and Latin America. But the fact is, like Bodhi in the 50-year storm, Bud’s not coming back.
“I wonder if ABI killed Budweiser… or if it would have died out anyway due to consumer habits changing,” mused the anonymous ABI alum. Probably the latter; maybe a bit of both. Who knows! Regardless, the King of Beers’ long-running stateside struggles cast curious light on corporate’s call to bail on the big game this year.
Here’s a take: what if ABI was looking for a reason, any reason, to pull the plug on Budweiser’s Super Bowl run, and the pandemic provided the perfect cover? For a c-suite so adept at delivering shareholder return via slashed budgets, the ailing King of Beers’ annual Super Bowl appearance may have been less a beloved big-game ritual than a pricey sacred cow. Better, the thinking might go, to spend American ad dollars showcasing brands Americans actually want to drink these days. In other words: why throw good Bud Light Seltzer money after bad Budweiser?
Fingers floated this theory to our one-time ABI insider. “Totally agree,” came their reply. “I only watch the Super Bowl because of the ads, and Budweiser is one of the ads I look forward to each year. But do I buy their beer? Rarely.”
The bottom shelf
Last call for anyone interested in applying for FREE BEER (writing) MONEY via the North American Guild of Beer Writers’ fourth-annual Diversity in Beer Writing grant. Grant winners are eligible for cash stipends up to $1,000 for “stories that can showcase diversity and inclusion – in all its forms and challenges – within beer.” Per NAGBW, female, BIPOC, LGBTQIA+, and people with disabilities are encouraged to apply. Good luck!
“None of us would have jobs, I’ll tell you that,” said Patrick Machel when I asked him how the union contract he and his coworkers signed with Anchor Brewing Co. in December 2019 had helped them out during the coronavirus pandemic. A year (ish) into their first three-year contract, I checked in with Machel and his three fellow shop stewards at the legendary San Francisco brewery about what’s working and what isn’t. The story is live on VinePair now, please read it, thank you. (In case you’re wondering, sources tell me that workers were not consulted in the recent rebranding effort, which was so poorly received that the brewery recently took to social media to defend it. Tough scene in Potrero Hill.)
My take on news that Uber will acquire Boston booze-delivery service Drizly for $1.1B? Sure, whatever, couldn’t be less shocked. Remember, Uber has not yet turned a profit, even though its Uber Eats business has been going absolutely berserk for the past 12 months thanks to… how you say… Le Pandémie? The House Kalanick Built sits on a foundation of consolidating its competition (it bought PostMates back in July 2020) and exploiting its labor (it spent $52M to propagandize the successful passage of California’s Prop. 22, which relegates gig work in the state to “a permanent underclass.”) So of course it’s going after the lucrative, if chaotic, alcohol-delivery space, betting that integrating Drizly into its ubiquitous, category-leading app will give it poll position as more states open the gates on booze via third-party delivery (3PD, in the jargon.) Drinking and driving shareholder returns, amirite?! Also:
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