Bud Light is at risk of losing store shelf space to competitors, warns former Anheuser-Busch executive

If Bud Light sales continue to lag, the brand risks losing shelf space at major retailers to competitors and “locking in” a lower market share, says a former Anheuser-Busch executive.

In recent weeks, Bud Light sales are down about a quarter from a year ago as the brand faces conservative backlash over an April marketing deal with transgender influencer Dylan Mulvaney.

Anson Frericks, the former US president of sales and distribution for St. Louis-based Anheuser-Busch, said retailers such as Walmart and Kroger typically “reset” their shelf space allocations in the spring and fall, based on sales data.

For the fall reset in September, “they generally take sales data from April, May, June, July, and based on that data in that time period, they will reallocate shelf space,” he told DailyMail.com in a phone interview Saturday.

If Bud Light sales continue to decline, “that shelf space will be allocated to Miller Lite, Coors Light, Yuengling and some of the other brands that have taken market share from them,” he said.

“Those brands are more likely to have longer-term success because they have more shelf space, more inventory, more back-stock, and more availability to consumers,” he argued.

“That then almost permanently enshrines this as the new standard for where their sales will be and what their share of the beer category will be,” Frericks predicted of the impact on Bud Light.

Frericks said the “vast majority” of beer sales, some 80 to 90 percent, are in traditional stores, as opposed to sales in bars and restaurants.

Frericks, who co-founded Strive Asset Management with longtime Republican presidential nominee Vivek Ramaswamy after leaving AB last year, has sharply criticized his former employer’s handling of Mulvaney’s backlash.

“Anheuser-Bush needs to come up with a strategy, it needs to make a statement about who their customers are and who they’re going to serve next, and now try to win those customers back in June and July because by the time it’s August, September, it’s too late,’ he said.

But Bump Williams, whose eponymous consulting firm analyzes the alcohol industry, expressed skepticism that Bud Light faced imminent reductions in shelf space at major retailers.

He noted that in 2023 sales numbers, Bud Light is still the top-selling beer in the country so far, though it has slipped below Modelo Especial in recent weeks.

“Bud Light MAY lose shelf space based on lost sales, but I would find it hard to believe that retailers would reduce the shelf space of the top-selling brand in the country today on a YTD basis,” Williams said in an email to DailyMail.com on Saturday.

“If we find out in late 2023 that Bud Light has dropped to the No. 2 selling brand, they will most likely keep their share of the space,” he added.

Anheuser-Bush did not immediately respond to a request for comment outside of normal business hours.

For the week ending May 20, Bud Light sales fell 25.7 percent from the same week a year ago, while closest rival Model Especial saw sales increase 9.2 percent, according to data compiled by the Williams company.

“While Bud Light is losing week after week, Modelo Especial is winning week after week and now Modelo is selling Bud Light on a national basis across all trade channels combined,” Bump Williams, who runs the consulting firm, told the New York Post.

“If this continues, Modelo will surpass Bud Light this year,” he added.

Modelo was the number two beer in the US last year, with sales of $3.8 billion, compared to $4.8 billion for Bud Light, according to data from Bump Williams.

Both Bud Light and Modelo are owned by AB InBev, Anheuser-Busch’s parent company.

But as part of an antitrust settlement, Modelo sales in the US are controlled by the rival Constellation Group and do not count as part of AB InBev’s global volumes.

The latest data points to a hardening of recent sales trends after the April 1 promotion of Bud Light with Mulvaney sparked anti-LGBTQ backlash and boycott threats.

During the four weeks through May 20, Bud Light sales were down 24.3 percent from last year, while Modelo sales grew 8 percent.

“That’s a monumental decline,” Williams told the Post. “Modelo has surpassed Bud Light for the first time since its launch in 1982.”

In a recent report, JPMorgan analysts said they expect AB InBev’s earnings before interest and taxes in the US to fall 26 percent this year, amid a 12 percent drop in volume and a 10 percent drop in revenue.

“We believe there is a segment of US consumers who will not be drinking Bud Light for the foreseeable future,” the note read.

Bud Light’s parent company said earlier this month that it will triple its marketing spending in the US this summer to boost ailing sales.

The controversy erupted on April 1, when Mulvaney posted a video on her Instagram page of her breaking open a Bud Light.

She showed off a custom can with her face on it that Bud Light sent her – one of the many business freebies she gets and promotes to her millions of followers.

Three days after Mulvaney’s post, Kid Rock posted a video of him shooting boxes of Bud Light, and country music stars John Rich and Travis Tritt publicly denounced the brand.

Within weeks, two marketing executives at Anheuser-Busch took a leave of absence. It is unclear whether they have returned to work yet.

After Anheuser-Busch attempted to distance itself from the Mulvaney promotion, Bud Light also faced backlash from the opposite direction, with pro-LGBTQ groups accusing the company of abandoning the transgender influencer.

Still, Michel Doukeris, CEO of Anheuser-Busch InBev, downplayed the impact of the setback, saying that US Bud Light sales declines in the first three weeks of April accounted for just 1 percent of InBev’s global volumes.

“We think we have the experience, the resources and the partners to manage this,” Doukeris said on a conference call with investors earlier this month.