Despite efforts to turn things around, Bud Light's double-sided boycott troubles may not be ending anytime soon.
The latest quarterly results from Bud Light parent company Anheuser-Busch InBev (BUD) show the backlash following the beer brand's partnership with transgender influencer Dylan Mulvaney in April continues to weigh on sales.
Unlike other boycotts that come and go, this one "really has a lot more staying power than I expected," Daniel Korschun, associate professor of marketing at Drexel University, told Yahoo Finance Live (video above).
"I think it is going to be going for months, if not years," Korschun added.
In the second quarter, US revenue dropped 10.5%, driven lower by the poor volume performance of Bud Light.
But that didn't stop Anheuser-Busch InBev CEO Michel Doukeris from striking an optimistic tone in the company's earnings call. Doukeris noted "an improvement" in market share from May to early July.
"It's a more stable scenario," he said.
As of the week of July 23, 2023, the company said its market share was down 5.26% year over year and was down 5.36% since the beginning of July. The Bud Light brand lost its top spot in the US beer market to Constellation Brands' (STZ) Modelo in early June.
According to Neil Reid, a professor at the University of Toledo, Anheuser-Busch InBev will have a hard time winning back the market share it lost to competitors like Molson Coors (TAP) and Constellation Brands.
"Beer drinkers are drinkers of habit," Reid told Yahoo Finance Live. "Those who made the switch from Bud Light to Coors Light are going to stick with Coors Light."
Bud Light looks to recapture customers
Bud Light volumes are still down significantly year over year, according to a note from Evercore ISI obtained by Yahoo Finance.
Volumes for the beer brand were down 29.3% for the week ending July 22, only slightly improved from the prior week's year-over-year decline of 29.7%. Anheuser-Busch InBev's other brands — including Michelob Ultra, Budweiser, Busch Light, and Natural Light — also saw slight improvements.
"That sequential Bud Light improvement was in line with [the] industry," highlighted Robert Ottenstein, senior managing director and partner at Evercore ISI.
Meanwhile, Anheuser-Busch is doubling down on marketing to win back its core audience.
Back in June, the beer giant announced the new campaign, called "That’s Who We Are." The first ad, dubbed "We Make the Beer," includes a 30-second and a 60-second spot that features more than 140 Anheuser-Busch employees, growers, wholesalers, and partners.
Rebates were also on the table to entice consumers, but Doukeris said that is typical for this time of year.
"This doesn't have anything to do with the Bud Light situation," he said. "[It] was planned and announced and shared with our wholesalers last year. ... There is not anything beyond that."
Bud Light also surveyed 170,000 consumers through a third-party research firm to figure out where the company stands since April.
According to Doukeris, customers said they want "beer without debate," the company to "focus on beer," and that it should concentrate on platforms such as the NFL, music, and Folds of Honor, which provides scholarships to military families.
"They kind of got out of their lane," Reid said. "They have to get back into their lane and focus on the fact this is a beer for everyone, stay out of politics, ... stick to sports and other types of advertising that we're familiar with."
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Brooke DiPalma is a reporter for Yahoo Finance. Follow her on Twitter at @BrookeDiPalma or email her at [email protected].
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