Does A-B Need More than Just Core?

Analyst says A-B needs a partner.

Bonnie Herzog, an analyst for Citigroup, today issued a report questioning whether Anheuser-Busch was doing enough to accelerate growth.

The report follows an investor presentation by A-B Chief Financial Officer W. Randolph Baker that laid out some marketing moves the brewer was making to accelerate growth of its core brands. Baker disclosed that so far during the fourth quarter core brands grew by 0.5 percent -- a showing that underwhelmed analysts.

From Herzog’s report:

"Overall, we believe that the company is taking the appropriate steps re-focusing efforts on driving growth through the core brands, but we are not convinced that these initiatives are enough to accelerate growth."

Herzog, who previously has said a deal between A-B and InBev is likely within two years, went on to say:

"We believe that A-B needs a more dramatic change such as a combination with a global player to compete more effectively with larger international brewers."

To see coverage of A-B's presentation, click here.

To see coverage of Herzog's prediction that A-B and InBev will do a deal, click here.

A-B Vows to Improve Core Brand Performance

Priority for 2008: Boost Bud Light

Anheuser-Busch on Thursday told analysts and investors it was committed to bettering the performance of Bud Light and its core brands in 2008.

The performance of A-B’s core brands has been a source of concern for analysts. So far in the fourth quarter, core brand sales-to-retailers are up 0.5 percent. In a note after the presentation, Morgan Stanley analyst William Pecoriello said the trend was “below our forecast.”

From the report:

"4Q STR trends are below our forecast, up 0.5% through last Sunday vs. our expectation of 1%."

Including new brands, such as InBev’s European portfolio, A-B STRs were up by 2.2 percent.

Bud Loses Share, Holds Distribution

Getting more marketing support.

How strong is the Budweiser brand?

So strong that even though it’s been losing share in supermarkets for well over two years it hasn’t suffered any meaningful loss of distribution, according to beer market analysis by Nielsen.

Indeed, despite Bud’s long-running decline, Bud was actually eking out distribution growth in supermarkets until September, according to Nielsen.

Indeed, while Bud’s 18- and 24-pack cans have accounted for nearly 46 percent of total losses over the latest 13 weeks, the 18-pack actually has gained distribution.

The big question for A-B -- which says it plans to ramp up marketing support for Bud behind the “Great American Lager” positioning -- is whether it can build on this in-store presence to regain share.

The numbers tell of the challenge. Bud’s volume share fell by 0.6 points during the four weeks ended November 17. Its dollar share slipped by 0.7 points.

During the period, Bud suffered share declines in 93.5 percent of all measured markets.

A-B Announces New Vodka

Playing on popularity of organic.

The St. Louis Post Dispatch today reported that Anheuser-Busch, which mocks cocktails in recent advertising for Bud Light, is test marketing an organic, Italian-made vodka called Purus.

From the story:

"The country's biggest brewer is selling a new organic wheat vodka in the Northeast's 'most exclusive' lounges and restaurants, as well as in wnine some specialty grocery and liquor stores."

Recall that Brew Blog reported about Purus in October.

The St. Louis Post-Dispatch Story can be seen here.

Brew Blog’s previous coverage can be seen here.

Beer Business Daily (subscription required) weighs in here.

A-B in Michelada Standoff

Claims “Mambo Michelada” infringes on Michelob trademark.

The Houston Chronicle on Friday had an interesting story about Anheuser-Busch’s four-year-old trademark dispute with a Houston-based Mexican restaurant chain.

The cause of the dispute?

A-B says Mambo Seafood’s “Mambo Michelada” -- described in the story as a combination of beer, lime juice, salt and the company’s spicy michelada mix -- sounds too much like Michelob.

From the story:

“Michelob owner Anheuser-Busch Cos. responded to that U.S. Patent and Trademark Office application, saying the Mambo Michelada will damage its name.

"'The term Mambo Michelada is confusingly similar to the brand name Michelob,'" said Frank Hellwig, one of Anheuser-Busch's attorneys - in the only comment the company provided for this article.

“Mambo attorney Daniel Schein, though, argues in court documents that Michelob is pronounced 'mick-a-lobe' and the Mambo Michelada is pronounced 'mom-bo mee-chee-la-da.' “

It’s interesting that since this dispute began, A-B has started marketing Bud and Bud Light Chelada -- which is modeled on the same Mexican beer cocktail that inspired the Mambo Michelada.

The Houston Chronicle story can be seen here.

Living the High Life in C-Stores

Second-fastest growing brand in the channel.

Miller High Life was the second-fastest growing brand in convenience stores for the four weeks ended November 3, according to beer sales statistics from Nielsen.

Miller High Life, driven by advertising featuring the delivery guy played by Windell Middlebrooks, gained 0.4 points of case share and 0.2 points of dollar share during the period.

It’s the 11th straight month in which Miller High Life gained share. And Miller High Life’s growth was widespread, with 52 percent of all measured markets seeing an increase.

Miller High Life’s performance helped boost Miller Brewing Company’s case share and dollar share by 0.4 points. Miller Chill has a 0.2 share in the channel. Steel Reserve picked up 0.2 points.

Anheuser-Busch saw its case share slip by 0.6 points and its dollar share fall by 0.6 points. That’s despite strong performance by Bud Light, which gained 0.6 points of case share and 0.5 points of dollar share.

Coors Brewing Company gained 0.3 points of case share and 0.3 points of dollar share. Coors Light led the way, adding 0.2 points of case share and dollar share.

Budweiser Returns to Past, Again

Emphasizes “Great American Lager” positioning.

Anheuser-Busch appears poised to play up Budweiser’s heritage on labels.

New Bud label applications filed with the government feature a box headlined “The Great American Lager” and a picture of Adolphus Busch. The text reads:

“In 1876, Adolphus Busch set out to create a distinctly American style of lager, one with great taste and exceptional drinkability. Using hand-selected grains, a special blend of hops, and unique beechwood aging, he formulated the perfect balance of flavor and refreshment. Five generations of brewmasters later, Budweiser still sets the standard for quality and taste.”

Last week, Beer Marketer’s Insights and Beer Business Daily reported that A-B planned to position Bud as the “Great American Lager” and emphasize quality and brewing in marketing messages.

A-B has played up Bud's heritage before. Recall that a few years ago A-B resurrected retro Bud cans, the Smiling Charlie mascot and some vintage TV ads.

The label application can be seen here.

The label image can be seen here.

BMI’s home page is here.

BBD’s home page is here.

The Wall Street Journal discussed how A-B is tapping Bud's heritage here.

Variety Driving Craft Beer Growth

Supermarkets carrying 20 percent more craft items.

Craft beer has had a phenomenal year in supermarkets.

Indeed, craft share volume was up 0.8 percent during the four weeks ended November 10, according to beer sales statistics from Nielsen. Dollar share, meanwhile, was up 1.3 percent.

Part of the growth is driven by expanded distribution. The average supermarket carries 28 craft beer items, up from 23 a year ago. That’s a 22 percent jump.

That expanded presence -- and variety -- is helping fuel growth. The fragmentation of craft makes it easier for new brands to enter in many markets as the category keeps growing.

How fragmented is it? The top 25 craft brands represent 58.7 percent of total category volume. Meanwhile, the top 25 imports represent 87.2 percent of total import volume.

SABMiller to Acquire Grolsch

Deal valued at $1.2 billion.

SABMiller plc today announced it has entered into an agreement to acquire the nearly 400-year old Dutch brewer Royal Grolsch NV.

The deal is valued at $1.2 billion.

SABMiller sees opportunities to develop the brand in a number of regions around the globe. From the release:

"SABMiller sees significant potential across Africa and Latin America, where the premium segment is still in its infancy, and in the more developed markets of Central and Eastern Europe. South Africa represents a key opportunity and with the addition of Grolsch, SABMiller will have a particularly strong portfolio of highly differentiated premium brands in that market."

No changes to existing distribution arrangements in Australia, Canada, the United Kingdom or the United States are anticipated at this time. Anheuser-Busch last year acquired distribution rights for Grolsch in the U.S.

In a conference call following the announcement, however, SABMiller Chief Financial Officer Malcolm Wyman said SABMiller "would seek to enter into discussions with [A-B] after the deal is closed."

A-B this morning sent a memo to distributors about the deal. Beer Business Daily characterized the memo as saying it was "business as usual."

Mike’s Goes Mojito

New addition to its cocktail line.

Mark Anthony Group, the marketer of Mike’s Hard Lemonade, appears to be bolstering its line of “premium malt cocktails” with a new flavor: Mojito.

The company earlier this month received a label certificate from the Treasury Department’s Alcohol and Tobacco Tax and Trade Bureau for the Mojito premium malt cocktail.

In an apparent effort to capitalize on the growth of spirits, Mike’s earlier this year began marketing cocktail-flavored flavored malt beverages in addition to its “Hard Lemonade” lineup. Mojito joins Crantini, Mike-arita, Lemon Drop and Screwdriver.

Like the other brands, Mojito comes in an 8-ounce bottles and should be served over ice, according to the label application. It has 8 percent alcohol by volume.

Mike’s is the latest FMB marketer to go Mojito. Anheuser-Busch launched Bacardi Silver Mojito earlier this year and quickly followed it with a pomegranate extension. A-B, which appears poised to introduce the brand on draft, has declared the brand to be a success.

Indeed, according to a report earlier this week by Beer Marketer's Insights, A-B told distributors that it expects Bacardi Mojito and some other new brands -- including Bud Chelada and Landshark Lager -- to generate more than 1 million barrels combined in 2008.

Meanwhile, Mike’s is the latest alcohol beverage marketer to jump on the pomegranate bandwagon. Earlier this month it received a label certificate for Mike’s Hard Pomegranate Lemonade.

The Mike's Mojito label application can be seen here.

A label image can be seen here.

The Mike's Hard Pomegranate Lemonade application can be seen here.

Coverage of A-B's distributor meeting can be seen here.

Miller STRs Up 1.4 Percent

Miller Lite sales up 2.1 percent on higher prices.

Miller Brewing Company posted a 1.4 percent increase in organic sales to retailers during the six months ended September 30 driven by strong performances from Miller Lite, Miller Chill and worthmore brands.

Domestic net revenue per barrel increased by 3.9 percent due to strong volume and pricing performance by Miller Lite, strong overall portfolio pricing and a migration of the brand portfolio to higher-margin, higher-growth brands.

Miller’s earnings before interest, taxes and amortization (EBITA) increased by 18.5 percent to $300 million, driven primarily by price increases and higher volumes. EBITA includes $16 million due to a retrospective cost adjustment with a can supplier.

Miller’s EBITA margin increased to 10.8% from 9.6%, as unit revenue improvements, favourable mix and the effect of the settlement offset increases in marketing and other costs.

Revenue increased by 6 percent to $2.78 billion.

Miller’s performance was disclosed Thursday in conjunction with SABMiller’s earnings.

"This has been a strong start to the year, demonstrating the strength of our brand portfolio and the health of our businesses,” SABMiller CEO Graham Mackay said in a release. “We have delivered another excellent performance in Europe, and a pleasing return to growth in North America, and our Asian businesses have continued their dramatic momentum with lager volume gains ahead of their respective markets. At the second anniversary of our Bavaria transaction, our volumes have grown strongly in Latin America and our investment plans remain on track."

Miller Lite returned to growth in the period, posting a 2.1 percent increase in sales to retail. At the same time, it increased the average case price by 2.1 percent.

Miller’s worthmore brands also showed strong growth. Peroni Nastro Azzurro’s STRs increased by more than 50 percent. The Leinenkugel’s franchise grew by 27 percent.

Miller Chill, meanwhile, is on track to exceed its first year retail volume target of 400,000 barrels.

Sparks volume grew by 10.8% on a proforma basis during its first full year in the Miller system.

Miller High Life also returned to growth, with STRs up 1.0%, driven in part by the popular delivery guy advertising starring Windell Middlebrooks. Average case prices were up 2.9 percent in supermarkets nationally.

Icehouse STRs were up by 2.0 percent.

Miller Genuine Draft performed in line with full calorie beers, with STRs down 9.3 percent.

Faced by strong competitive pressure from economy beers, the Milwaukee’s Best franchise saw STRs slip 4.0 percent.

Counting new brands, Miller’s STRS increased by 5.9% over the six months (1.4% on an organic basis), while reported domestic shipments increased by 6.7%.

“Miller will continue to increase brand investment to support its current volume momentum,” the company said in a release. “The business will continue to face input cost pressures.”

The SABMiller release can be seen here.

Widmer, Redhook Form No. 3 Craft Brewer

A-B affiliated crafts to combine in early 2008.

Two Anheuser-Busch-affiliated craft brewers are combining to create the country’s third-biggest craft brewer.

Redhook Ale Brewery and Widmer Brothers Brewing Company yesterday announced they will combine to form an entity called the Craft Brewers Alliance.

The deal, in which Redhook is paying about $50 million in stock for Widmer, has been expected for some time. The two Pacific Northwest brewers disclosed last January that they might merege.

A-B – which has significant minority interests in both brewers – was not driving the talks, the brewers said at the time.

Redhook and Widmer currently have a marketing and sales joint venture called the Craft Brands Alliance. That entity, in turn, has a distribution agreement with A-B. Recall that last year Redhook complained the Alliance was not doing a good job of selling its brands in the West.

Paul Shipman, CEO of Redhook, told the Seattle Post Intelligencer that the combination should allow the bigger craft brewer to better handle rising input costs. From the story:

"Craft brewers still face challenges, including soaring prices for barley malt and hops. In the third quarter, Redhook reported a loss of $289,000, or 3 cents a share, compared with a profit of $364,000, or 4 cents a share, in the year-ago period; sales rose 15 percent to $11.1 million. Shipman believes a larger, unified company will be in a better position to deal with that problem."

The Seattle Times reported that the new company would have annual shipments of about 600,000 barrels. This would make it the third-biggest craft brewer, after Sierra Nevada brewing Company.

From a Q&A Redhook filed in conjunction with the merger announcement:

"We expect that the CBA portfolio including Widmer, Redhook and our alliance brands of Kona and Goose Island will make the combined company the second or third largest craft brewer in the US."

Widmer shipped 269,000 barrels in 2006 and Redhook moved 168,000 that year, for a total of 467,000 barrels, according to figures from Beer Marketer’s Insights.

That total just edged New Belgium Brewing Company, maker of Fat Tire, which had 438,000 barrels shipped.

The Jacob Leinenkugel Brewing Company, which is owned by Miller Brewing Company, shipped 370,000 barrels that year.

The deal is expected to close in the first quarter of 2008.

The press release announcing the deal can be seen here.

The Seattle Times coverage can be seen here.

The Seattle Post-Intelligencer coverage can be seen here.

The blog Brookston Beer Bulletin discusses the deal here.

Sparks Recognized As Hot Brand

Named to Ad Age’s Marketing 50.

Advertising Age this week named Sparks as one of 2007’s “Marketing 50.”

It’s an honor the magazine gives to brands that distinguish themselves through innovative marketing and commercial success.

In the case of Sparks, Ad Age pointed out that Miller Brewing Company faced a challenge in marketing a brand that had underground cachet.

Ad Age recognized Miller’s ability and flexibility in crafting a marketing strategy that was right for the brand.

From the story:

"Miller has leaned heavily on brand ambassadors (known as "Sparkitechts"), ads in counterculture magazines and unorthodox sponsorships such as a relationship with national air-guitar champion William Ocean. The upstart brand grew sales 40% in 2006 and is reportedly on pace to sell 4 million cases this year. 'We've tried hard not to Millerize it,' says Randy Ransom, the 45-year-old chief marketing officer. 'We've been doing mass marketing a long time, and this taught us a different way.'"

Ad Age also named Heineken Premium Light to this year's list.

The story can be seen here.

A-B: We’re “Not Winning Battles at Retail”

A-B execs vow action at distributor meeting.

Anheuser-Busch executives promised distributors changes to marketing and sales at its recent regional meetings, reports Beer Marketer’s Insights.

The story quotes A-B’s new top sales executive:

"New sales veep Evan Athanas called this a "watershed moment for our company," noting that despite superior manpower and resources, AB "not winning battles at retail. That's unacceptable." That's why AB needed to change its sales structure for first time since 94 with big emphasis on delayering, decentralizing and speeding up decision-making. "It's our time," he said."

BMI also reported that new top marketing executive Dave Peacock said “there was an issue in pull marketing” and “not enough air cover,” BMI reported. Fixes include ramped up investment behind Budweiser and Bud Light (a $70 million bump, BMI reports) and focus on fewer brands.

A-B also will stop showing “Super Bowl ads in August,” Peacock said, according to BMI.

New ads tout the “superior drinkability” of Bud Light, according to BMI. A-B plans to position Bud as the “great American style lager” with ads emphasizing the brewing process. And Michelob gets a new slogan for a $30 million campaign that apparently tries to capitalize on the growth of craft beer: “crafting a better beer.”

A-B also said it is eyeing more than 1 million barrels in volume from new brands next year, including Bud Chelada, Landshark lager and Bacardi Mojito.

The BMI home page can be seen here.

Miller Chill Heads to Australia

Beer to be exported from U.S.

Miller Brewing Company is exporting Miller Chill to Australia, the Wall Street Journal reported today.

The new brand -- a light beer brewed with a hint of lime and salt -- hit the Down Under today.

From the story:

"SABMiller selected Australia as Chill's first international market because of similarities between the Australian and U.S. markets, [Miller spokesman Julian Green] said. SABMiller has about half of a percent of total volume in Australia, according to Mr. Green. The company will import Miller Chill from the U.S., rather than having it brewed in Australia. The average price of a six-pack will be 13 Australian dollars ($11.87)."

Miller Chill, which was launched in test this past spring and went national in the early summer, has surpassed sales targets for the year and has achieved positive cash flow, the story said, citing Miller sources.

Miller Chill has surpassed Heineken Premium Light, Michelob Light and Modelo Especial in dollar share in supermarkets.

The Wall Street Journal story (subscription required) can be seen here.

Sopranos Wine?

Family business goes in new direction.

Fans of the recently departed HBO series The Sopranos can now ponder the show’s finale over a glass of wine named after the fictional crime family.

Duggan’s Distillers Products Corporation has received a number of label approval certificates from the Treasury Department’s Alcohol and Tobacco Tax and Trade Bureau for a line of Sopranos wines.

So far Duggan’s has received certificates for three Chiantis, two Pino Grigios and a Pinot Noir.

The labels bill the wines as being imported by the “Vesuvio Wine Company” – an allusion to an Italian restaurant that was a frequent setting for the show.

A label application can be seen here.

An image label can be seen here.

InBev’s U.S. Shipments Dip

Big brewer has tough quarter.

InBev’s European brands – which include Stella Artois, Beck’s and Bass – showed a decline in shipments to the U.S. during the third quarter, the world’s biggest brewer by volume reported on Thursday.

InBev, which struck an importing and marketing alliance last year with Anheuser-Busch, in an earnings release said:

"Although shipments of our European import brands into the US to Anheuser-Busch (“A-B”) were lower during the third quarter, depletions, while still slightly negative yoy, improved compared to the previous two quarters, led by Stella Artois."

Speaking of its overall North American performance (InBev owns Canada’s Labatt), InBev said:

"Tight cost management in North America helped drive margins higher in a challenging environment."

InBev shares slid 10 percent as the company failed to meet analysts’ estimates. InBev fell victim to general industry weakness in western Europe, as Stella Artois and Beck’s posted lackluster results in the UK and Germany, respectively.

An analyst said the weak showing could hurt InBev’s ability to potentially do a deal with Anheuser-Busch, the subject of much speculation in recent months.

From a story in Bloomberg:

``This set of results does not help the possible negotiating position of InBev,'' given Anheuser's stronger recent results, Gerard Rijk, an analyst at ING Wholesale Banking, said in a note today. He said he's likely to lower his forecasts.

The InBev release can be seen here.

Bloomberg's coverage can be seen here.

Are the Beer Wars Back?

A-B keeps up the heat.

“Are the beer wars back?’ asks the headline of an Associated Press story.

Could be, as Anheuser-Busch continues to lash out at Miller Brewing Company over a Miller Lite commercial that playfully uses A-B’s dalmatian mascot.

A-B on Wednesday ran in the Milwaukee Journal-Sentinel the same “Keep up the bad work, Miller Beer” advertisement that appeared in Tuesday’s editions of the USA Today and St. Louis Post-Dispatch. Brew Blog reported on that yesterday.

But, as the AP story noted, Miller “isn’t backing down.” Miller today ran in ad in the USA Today to drive Miller Lite’s “Good Call” message. The ad shows the back of two Miller trucks that carry the message that Miller Lite has more taste and fewer carbs than Bud Light.

“The facts speak for themselves,” the ad says.

The AP story goes on:

“Miller President and CEO Tom Long said in a note to distributors Tuesday that the company will have more showings of the ad this weekend during football games on several networks.

"’The 'able challenger' is alive and well, and if A-B thought the Miller system would lose its competitive edge in the months to come, they don't know us or you very well,’ Long wrote.”

It’s important to remember that the ultimate goal of comparative advertising -- good comparative advertising, at least -- is to differentiate your product.

A-B should know: It used comparative advertising to drive Bud Light sales back in the 1980s with its “Make it a Bud Light” advertising.

That campaign worked -- and so has comparative advertising for Miller Lite that touts its carb, calorie and taste attributes.

Comparative advertising, such as the “blue and whites,” has been a key part of Miller’s ad mix ever since the brewer made the “hard right turn” to focus on the beer.

And during the six months ended September 30, essentially the period since Miller took the turn, Miller Lite sales to retailers have increased by 2.1 percent.

It’s worth asking whether that trend, and not the playful use of an A-B icon, is what prompted A-B’s response.

So will the beer wars continue? Advertising Age yesterday reported that A-B CEO August Busch IV told distributors that the “Bad work” ad was a one-off (possibly timed to the A-B distributor meeting?). But in the past A-B has gone on the attack after saying it wouldn’t.

Ultimately, it may all depend on whether Miller Lite’s growth trend raises concerns in St. Louis.

The AP story can be seen here.

The Ad Age story can be seen here.

Previous Brew Blog coverage can be seen here.

Dogfight

A-B swings back at Miller over dalmation ad.

Anheuser-Busch on Tuesday lashed out at Miller Brewing Company over a Miller Lite ad that playfully uses the Budweiser dalmation.

“Keep up the bad work, Miller Beer,” thundered a full-page ad in the USA Today. The ad goes on to say that the ad has prompted A-B to give a donation to animal rescue groups.

The ad -- in which a dalmation leaps from a Bud wagon into a Miller Lite delivery truck after reading the “more taste” and “fewer carbs” slogans -- marks the latest step in Miller’s hard-right turn back to advertising focused on product attributes. The commercial was created by Miller Lite agency BBH.

The A-B ad, decrying the Miller Lite commercial as “negative advertising,” continues: “Apparently, Miller Beer believes they have to say negative things about our brands to sell their beer.”

Actually, comparative advertising is a time-honored marketing strategy of No. 2 able challengers. Avis’ “We try harder” is probably the classic example.

And it’s worth recalling that Miller Lite sales increased when Miller first ran comparative ads in 2003 and 2004.

From a story in the online version of Ad Age:

"That fight seemed to benefit Miller, which gained market share in both years and didn't lose momentum until A-B slashed its long-held price premium in early 2005."

Back then A-B responded with harsh attacks, including denunciations of Miller’s “foreign ownership.” Then A-B publicly declared it wasn’t going to attack anymore -- though it did so again.

Indeed, A-B’s latest decision to blast back at Miller is somewhat surprising given that marketing execs there had previously told Ad Age they would not respond.

From an October 22 story:

"A-B marketing executives -- who greeted news of Miller's coming spoof of their icon with groans -- said repeatedly they will not let themselves be dragged into a similar battle again."

Indeed, a St. Louis Post-Dispatch story on Nov. 3 about Miller’s return to comparative advertising characterized the response of A-B’s top marketing exec as “muted.”

From the story:

"Regardless of any competitor's actions, we remain focused on raising the image of beer," David Peacock, vice president of marketing at A-B's domestic beer subsidiary, said in a statement. "In the interest of the entire industry, we remain committed to generating beer growth."

That said, at its distributor conference on Tuesday, A-B showed a modified version of the Miller Lite ad, according to a report in Ad Age. The twist: The dalmation defecates on a case of Miller Lite.

The St. Louis Post-Dispatch story can be seen here.

Today's Ad Age story can be seen here.

The Ad Age piece about the A-B's modified version can be seen here.

Coors’ Sales Strong, Margins Soft

Analyst says margins weaker than expected.

Coors Brewing Company, the U.S. arm of Molson Coors Brewing Company, on Tuesday reported strong third quarter sales as all three lead brands posted healthy growth.

But observers have pointed out that margins were relatively soft.

Coors reported a 6.9 percent increase in sales to retailers during the quarter. That was driven by “mid-single-digit growth” by Coors Light, “strong double-digit growth by Blue Moon,” and “low-double-digit growth” by Keystone Light, according to a Molson Coors earning release.

Indeed, long-declining Coors Banquet actually posted its second consecutive quarter of growth.

Commenting on the sales, Beer Marketer’s Insights wrote: “Coors US sales very nearly firing on all cylinders in 3d qtr. … Can’t remember that strong a volume qtr for any big 3 brewer in a very, very long time.”

That said, Coors’ margins -- and, in Canada, Molson’s -- came in below the expectations of UBS analyst Kaumil Gajrawala:

"Both regions however, posted weaker margins; Canada and the US were 50bps and 30bps below our expectations, respectively."

Coors’ shipments to wholesalers increased by 3.4 percent. BMI said this was below its (BMI’s) estimate.

Wrote BMI: “So even tho Coors kept costs in check, up just 1.7% per bbl, its income before taxes (and special items) had modest 8.4% increase to $80.5 million.”

In the Molson Coors earning release detailing the results, Molson Coors CEO Leo Kiely said: “In our two largest markets, the U.S. and Canada, we continued to gain market share on the strength of our strategic brands.”

At 11:58 a.m. eastern time, Molson Coors shares were down 2.10 percent, or $1.19, to $55.35.

The Molson Coors release can be seen here.

The BMI home page is here.

Are Big Imports Losing Cachet?

Small importer sees opportunity.

The latest issue of Brandweek takes note of the relatively soft performance of Corona Extra and Heineken and questions whether (as the headline says) “the party may be winding down for beer imports.”

The analysis points to a variety of possible explanations, including a price increase for Corona and the popularity of local crafts.

Another theory: The leading imports have become so big that they’ve lost the sense of specialness that drove their growth in the first place.

From the article:

"'It's remarkable that some of the imports are beginning to behave like the domestic brewers with their mass media campaigns and major investments in light beer,' said John Lennon, formerly president of Beck's North America.

"Now at the helm of International Beverage Holdings USA, New York, Lennon sees opportunity for smaller players like Chang beer—which IBH will promote through Thai restaurants in major markets—if the badge status of the dominant imports diminishes."

The story can be seen here.

Miller Chill Seasonality

Autumn performance mirrors other worthmore brands.

The seasonality of Miller Chill has been the topic of a lot of talk and writing in recent weeks. But much of that discussion misses an important piece of context.

It’s this: After Labor Day, beer category share in supermarkets shifts from worthmore beers (higher-priced beers such as imports, crafts and Miller Chill) to lower-priced brands. Occasions during this time – think tailgating – skew toward lower-priced segments.

Indeed, Corona Extra has experienced post-Labor Day share declines in supermarkets the past three years, according to beer sales statistics from Nielsen.

So a decline in Miller Chill -- which has surpassed Heineken Premium Light, Michelob Light and Modelo Especial in dollar share in supermarkets -- after Labor Day isn’t all that surprising.

Of course, worthmore beers bounce back -- and their share peaks -- over the winter holidays as shoppers splurge.

So the challenge for Miller Brewing Company is to make sure that it gets its share of that surge, which is the objective of a variety of marketing programs, including a new on-premise push, increased on-premise trial programs and new TV ads with steady support.

Brew Blog covered Miller's plans to step up Miller Chill support here.

Trader Joe’s Pushing into Mexican Beers

Receives label approvals for “Trader Jose” brands.

In another sign of the growing trend of Latinization, Trader Joe’s appears to be pushing into private label Mexican beers.

Over the course of the year, Trader Joe’s has filed label applications for “Trader Jose” branded beers.

Last month it received a label certificate from the Treasury Department's Alcohol and Tobacco Tax and Trade Bureau for Trader Jose Dark Premium Lager. Earlier in the year it received approvals for Trader Jose Premium lager.

For years Trader Joe’s has marketed a variety of private label beers, including a hefeweizen, Bohemian and Vienna lagers, bocks and Oktoberfests. Beers for the eastern half of the United States are brewed by Chicago’s Goose Island Brewing Company; the west is handled by Gordon Biersch Brewing Company in California.

The Trader Jose beers are made in Mexico.

Trader Joe’s move makes sense given the growing popularity of Mexican beers. Corona Extra was the country’s sixth biggest beer in 2006 and other leading Mexican imports, including Modelo Especial and the Femsa brands, are posting robust growth.

The leading domestic brewers are trying to capitalize on this trend as well. Miller Brewing Company launched Miller Chill, a chelada style beer, in recognition of the Latinization trend. And Anheuser-Busch is preparing a national rollout of its chelada product.

The label application for Trader Jose Dark Premium Lager can be seen here.

A label image can be seen here

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