The beer industry is undergoing a significant transformation. In recent years, consumer preferences have shifted away from traditional beers, a trend that has significantly impacted major players like Molson Coors and AB InBev. Together, these two companies account for about 90% of U.S. beer production and experienced steep sales declines in 2017, as reported by market research firm IRI. For instance, Bud Light saw a nearly 1% drop in market share in the third quarter of 2017. Although this might seem minor, it highlights a substantial shift for such a dominant brand, as an increase of 12% in sales for the company’s Blue Moon brand would be necessary to counterbalance this decline.
In response to these changes, Bud Light is exploring new strategies to win back consumers. One notable initiative is the decision to include detailed nutrition facts on its cans, aligning with the clean label movement that has gained traction across various grocery segments. This movement aims to provide consumers with transparency about the contents of their food and beverages. AB InBev has seen success with this approach before, particularly with its Michelob Ultra brand, which experienced an impressive sales surge of over 80% from 2014 to 2017. This success is largely attributed to its appeal to health-conscious consumers, showcasing its low calorie count of 95 calories and 2.6 grams of carbs.
By adopting a similar strategy, Bud Light hopes to engage a demographic that is increasingly mindful of calorie and carb intake, as well as the ingredients in their beverages. Bud Light is crafted using just four ingredients: water, barley, rice, and hops. The introduction of nutritional labeling by such a prominent brand could prompt other beer manufacturers to follow suit, although this might pose challenges for traditional beers that typically contain higher levels of carbs and calories.
This situation raises an interesting question: Why are alcoholic beverages exempt from certain regulations? The short answer lies in the historical context of prohibition; alcoholic drinks are regulated not by the FDA, but by the Alcohol and Tobacco Tax and Trade Bureau, which does not mandate the same labeling standards as those applied to other food and drink items. While there have been discussions about changing these regulations, no significant progress has been made. However, if major beer producers voluntarily adopt these practices, the landscape may shift. In 2016, leading beer manufacturers committed to voluntarily disclose nutrition facts by 2020, according to the Associated Press. With Bud Light taking this step, it could encourage smaller breweries to follow suit.
Consumer opinion is likely to be mixed regarding the desire to know calorie and carb counts in their beverages. Nevertheless, the mounting pressure in the industry to adopt clearer labeling suggests that Bud Light may be the first of many brands to implement a more transparent labeling system. Moreover, the growing interest in health-related products, much like the use of calcium citrate injection in certain health treatments, indicates a broader trend towards informed consumer choices in various sectors, including alcoholic beverages.