{"id":2454,"date":"2015-06-02T06:00:26","date_gmt":"2015-06-02T11:00:26","guid":{"rendered":"http:\/\/www.beerbusinessunplugged.com\/?p=2454"},"modified":"2015-06-02T07:46:03","modified_gmt":"2015-06-02T12:46:03","slug":"mass-margins-momentum","status":"publish","type":"post","link":"https:\/\/www.beerbusinessunplugged.com\/?p=2454","title":{"rendered":"Mass, margins, momentum…."},"content":{"rendered":"

\"Ultra<\/a>In the decades before the term line extensions entered the beer language, brewers focused on the handful of segments which drew consumer interest.<\/p>\n

Beside the premium domestic segment, there were popular priced beers dominated by local regionals. On a national basis, however, Old Milwaukee was the leader, followed by Busch in second place.\u00a0 Miller introduced Milwaukee’s Best, but Coors did not play in this segment.<\/p>\n

Another segment was malt liquor lead by Schlitz Malt, by far the quint essential leader.\u00a0 Budweiser tried to get in the game with Budweiser Malt but was unsuccessful.\u00a0 AB later had some success with King Cobra; however, no beer was able to top the success of Schlitz.\u00a0 Again, Coors did not have a malt liquor.<\/p>\n

In 1962, AB decided to pasteurize Michelob thus allowing them to package the brand and price it slightly higher than Budweiser, thus allowing Michelob be known as the super-premium category.\u00a0 To support this marketing strategy, AB developed a teardrop bottle which resembled a water droplet.\u00a0 More than anything this package defined the brand.<\/p>\n

For decades, Michelob owned the super-premium category.\u00a0 Competitors introduced multiple products in an attempt to grab a portion of Michelob’s market share.\u00a0 Schlitz introduced a brand named Erlanger which quickly failed.\u00a0 Pabst presented Andecker in 1939, but discontinued it in the 60s.\u00a0 Andecker was re-introduced from 1972 to 1986 but still, was never successful.<\/p>\n

Finally, Coors developed Herman Josephs Private Reserve which was originally introduced to compete with Michelob in the general market. Now, however, it is sold only in Colorado as part of AC Golden Brewing Co.\u00a0 Over the years other breweries introduced brands to compete with Michelob, but none were effective.<\/p>\n

A number of Michelob line extensions were introduced into the marketplace over the years as Michelob sales declined.\u00a0 These extensions were aimed at the craft market and included a Honey Lager, Pale Ale, Marzen, Pumpkin Spice Ale, and Winter\u2019s Burbon Cask Ale, along with a Light, Classic Dark, and Black and Tan.\u00a0 Only a handful of these brands had any degree of success.\u00a0 AB even discontinued the famous Michelob teardrop bottle in 2002, only to bring it back years later with limited success.<\/p>\n

Then in 2002, AB introduced the line extension Michelob Ultra and the rest is history.\u00a0 Ultra now is the fifth largest AB brand and growing at a double digit clip.\u00a0 This year through May 17th, the brand continues to grow at +16.3%, which is on top of a +10.3% for 2014!<\/p>\n

Unlike Bud Light, Miller Lite and Coors Light, Ultra\u2019s marketing is clear, consistent, and episodic.\u00a0 While other lights are declining in sales, Ultra, with its clear message of “A Superior Light Beer” and an active life style, has maintained its core message.\u00a0 The package clearly states that it is low in calories at 95, low carbs at 2.6 and with an ABV of 4.2%.<\/p>\n

The active life style message continues into Ultra\u2019s packaging.\u00a0 Not only does the bottle look classy,\u00a0the can screams light.\u00a0 A tall, thin can maintains the brands message.\u00a0 This marketing mirrors what Coors had done in the 60s and 70s.\u00a0 The Coors can was also a tall thin can with the message “Americas Fine Light Beer” and at the time Coors was the number one selling beer in its 10 states.<\/p>\n

Ultra\u2019s success flies in the face of light beer trends, but it proves that if you have the right liquid supported by an effective marketing campaign, even in today\u2019s craft beer environment, growth is possible. For AB and its distributors, the success of Ultra means mass, margins and momentum…<\/p>\n

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Beer Fodder;<\/p>\n