Brand Origins: Budweiser
2018 has really proven to be Budweiser’s year. Not only did America’s most famous beer enter into new markets, it was also the official sponsor to the 2018 FIFA World Cup. Like Levi and Nike, Budweiser is one of those brands that through various channels of media, has entered into the collective conscience.
I remember as a kid, if I was watching a movie made in the 1970s, 80s or 90s, anyone in the movie wearing a pair of jeans would be wearing a pair of Levi’s. When it came to what was on their feet and if it was informal, then Nike almost always was the sneaker of choice. If Nike and Levi’s were responsible for adorning the stars of movies in clothing and apparel, then it was almost always Budweiser that was the beer of choice. To this day, if you’re watching a well-produced Hollywood production and a drink is to be ordered at the bar, odds are it’s going to be a Budweiser.
Musicians have sung about Budweiser. Famed rocker Sheryl Crow in her 1993 hit song, “All I Wanna Do,” strung chords to the following lyrics:
I like a good beer buzz early in the morning. And Billy likes to peels the labels from his bottles of Bud.
It’s not the best message out there, but it speaks volumes about the brand’s entrenchment. I do think that Budweiser has improved upon the taste of their beer. Although if I think about it, it might just be the age of my beer pallet. I tried it in my early 20s and was not at all impressed. Recently I gave it another go, with all this world cup buzz and I must admit, I was very impressed. I was taken with Budweiser for two reasons – taste and price. The beer is incredibly affordable and it tastes great, thereby applying two classic concepts of American capitalism – good price, good value. One could even go as far to say that Budweiser offers high quality at a cheap price.
So, before you become convinced that Budweiser is greasing my palm, which I wish they were, let us take a closer look America’s most popular beer and how they’ve gotten this far in a little segment I’d like to call: Brand Origins.
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Budweiser: Where it All Started
If you visit the official Budweiser website, you’ll get a nicely packaged and sanitised version of events, starting with the company’s inception in the late 19th century. This story highlights the founders, their early days and their innovations. Put another way, this story is the one Disney is likely to make. The basics of the story can however be adhered to: an immigrant comes to the land of opportunity, he knows how to make beer, he joins forces with someone who has the cash but not the skill and together they birth Budweiser.
One of the biggest innovations that Budweiser boasts about is the process of pasteurization, a process they claim to have started doing before milk companies. In addition to this cleansing process which made the beer fit for long trips, the company also manufactured their own line of refrigerated rail cars to move their beer into the rest of the country.
Prohibition was a really big deal in the United States and the powers that be implemented it at a time when they felt it was most required. America had endured The Great Depression, the economy was in a slump and unemployment was at an all-time high. The last thing the nation needed was access to alcohol. Budweiser survived the prohibition years by selling yeast and thus the company and 2000 of its employees were kept afloat. In addition to the sale of yeast, Budweiser strived through diversification. It made ice cream, soft drinks and a non-alcoholic cereal beverages.
Growth & Domination
The period after World War II was one of incredible growth, expansion and domination for the Budweiser brand. A huge network of breweries was established and annual sales of 3 million barrels went to 34 million. Along with such growth came diversification in the form of entertainment, real estate, industrial products and by 1957 Anheuser-Busch (Budweiser’s company name) became the leading American brewer. The success of the Budweiser brand rested firmly on the shoulder of its owners, the Busch family, who ran it in succession. In fact, the company remained in the family from inception until the year 2008 when it joined forces with InBev to become Anheuser-Busch InBev.
The consolidation of power is a common occurrence in the world of commerce. The belief is that the more you acquire and control, the more profit you can deliver to your interests, the more you can make and a larger segment of the world you can cover. Coca-Cola is one prime example of consolidation. For a large part of the company’s history, it produced the syrup to make Coca-Cola and it sold the syrup to independent bottling companies. The bottling companies, often run by families had forged long-standing friendships with Coca-Cola, but as the years marched on Coke saw the need to exercise more control over its product. Slowly the company began to phase out its reliance on the bottlers by buying them out and by constructing its own bottling firms. Today Coke manufactures its drink from start to finish and achieves its goal of no profit-sharing.
In the world of beer, consolidation has also occurred, although not quite in the Coca-Cola way. Mergers of epic proportions have occurred instead to see mega corporations owning and distributing almost every single beer you drink. The most prominent ones are Anheuser-Bush, now Anheuser-Bush InBev. InBev, a Belgium Brewing company, itself a formation of Interbrew and Brazil’s Ambev, is a massive beer conglomerate who bought Budweiser and it that’s not already more than enough to concentrate on, they acquired SABMiller for $104 billion. Let that sink in for a little bit. Disney paid George Lucas $4 billion to buy Lucasfilm and all affiliated properties; Anheuser-Bush InBev paid $104 billion! SABMiller itself is a South African brewing company that acquired Miller Brewing. It all seems somewhat incestuous.
Anyway, the point I’m attempting to make here is that it’s just really a handful of companies that make all the beer we know, love and drink. Budweiser, under the InBev label pushes out Bud Light, Bud Ice, Bud Light Lime, Stella Artois, Beck’s and at least 20 other well-known alcoholic beverages. It occupies 45% of the US market.
Beer’s a tough game. There are many microbreweries that have popped up to segment themselves into the market in the form of kraft beer, but their profits pale, excuse the pun, in comparison to those of the big boys. I’m not crazy about kraft beer myself and for a number of reasons. I find it to be overpriced and attached to a specific social standing. Put another way, it’s pretentious. Give me a Bud and I’ll be just fine. In fact, make that two.