Market Beerbath: A Short Story

Bud Light fans are pissed. And I don't mean piss drunk.

Up until Monday I didn’t even know who Dylan Mulvaney was. Why do I know who this person is now? My dad mentioned the Bud Light debacle and explained the story to me in passing. Before we even go down the “know your audience” critique, let’s ask some simple questions; why is this happening? Why do I now know who Dylan Mulvaney is? Why do so many people seem so upset about this? We’ll get back to that in a moment. If you’re unfamiliar with the story, just Google GOOG 0.00%↑ it.

TLDR: Bud Light partnered with a trans influencer to market the product and now the company’s base is upset about it.

Know Your Audience

I’m going to come right out and say I don’t care for Bud Light as a product. I never have. I never will. In fact, I don’t drink Anheuser-Busch InBev BUD 0.00%↑ products as far as I know. “As far as I know” is important distinction to make because Bud Light’s parent company has literally hundreds of beer brands globally and several of the most popular brands domestically. Look at this portfolio, it’s impressive from a sales standpoint:

The beer drinking market has spoken and I’m apparently the crazy one for drinking the offerings from Molson Coors TAP 0.00%↑ more often. Whatever.

• Miller Lite tastes better than Bud Light

• MGD and Coors Banquet both taste better than Budweiser

• Michelob Ultra tastes like nothing

• And Blue Moon is better than Shock Top

Don’t at me… most of this is jest, I promise. Everyone’s taste buds are different and I literally couldn’t care less what you drink. Just because Bud Light tastes like stale, wet bread to me it doesn’t mean you shouldn’t drink it if you somehow enjoy that swill. Want to know my honest opinion? All of this stuff sucks compared to The Boston Beer Company SAM 0.00%↑ anyway.

You know what I drink when I need a cheap sixer? Yuengling. That’s the real ‘Merica beer.

Anyway…

I’ll re-ask my question from the beginning of this musing.

Why Is This Happening?

Here’s the thing, all of these companies have dozens of domestic brands and products. I love getting a Sam Adams variety pack at Costco COST 0.00%↑ but Boston Beer Company doesn't need me to drink Truly - the popular hard seltzer brand that is owned by the same company. They already have my money.

I'm not a marketing expert. But I don't know that jeopardizing a loyal client base that represents an enormous share of the alcohol market TAM to appeal to a community that is very small comparatively makes good financial sense. Almost certainly not in the middle of an abundantly obvious culture war. I suppose if you're down with the Davos syndicate, pushing buttons intentionally could be a possibility:

Whether it’s all part of some ridiculous WEF initiative to get us all arguing or not, the deal between Bud Light and Mulvaney is estimated to be worth about $50k. That could turn out to be an expensive mistake if Bud Light sales get hit hard in Q2. The market is already giving indications:

In the last few days, over $4 billion has been wiped off of Anheuser-Busch InBev’s market capitalization. This is while the broader market has been up and Molson Coors has outperformed.

Oops.

Disclaimer: I’m not an investment advisor. I am long TAP.