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A-B, MillerCoors Rethink Their Sub-Premium Lineups

March 17, 2014

MillerCoors and Anheuser-Busch are both seeking to shore up their sub-premium beer businesses, which have been losing volume steadily over the past several years.

MillerCoors, which has cut back such low-end brands as Southpaw Lite and Red Dog in the past year, will begin national television ad support again for its Keystone Light and Miller High Life labels in March. The company had discontinued TV advertising for both brands more than two years ago, except for some scattered regional TV spots for High Life last year. High Life suffered a 12% volume drop in the U.S. last year, while Keystone Light fell by 6%, according to Impact Databank.

“The economy segment has been a real struggle,” acknowledged MillerCoors chief marketing officer Andrew England in an interview. “We had stopped doing national media for these two brands because we felt we could get a better return investing those media dollars elsewhere. But we now find that we have to keep reminding consumers what is special about these brands.”

England wouldn’t disclose the budget for the TV campaign this year, but did say that “our marketing spend overall in 2014 is budgeted to be considerably ahead of 2013 levels.” He added that there is no plan for print ad support currently for Keystone or Miller Light.

Meanwhile, A-B this month is rolling out its new sub-premium brand, Busch Signature Copper Lager, in test across a dozen states in the midwest. Copper is at 5.7% abv—unusual for a sub-premium label—and its full-bodied, malty flavor is evocative of more expensive craft products. The introduction comes after the Busch label’s volume fell by 7% in 2013. Stablemate Busch Light was flat.

Nathan Scudieri, director of value brands at A-B, noted that sub-premium consumers are typically the most loyal of all beer drinkers. Even so, he said, “We’ve seen value-brand consumers trade up recently to experiment with higher-alcohol and more aromatic flavors. We felt we had to come up with a value choice with more alcohol and a caramel malt that imparts a sweeter and fuller body in the mouthfeel. We think we’ve got a winner.”

Scudieri said Copper Lager would be produced only at the company’s St. Louis flagship plant for now. A decision on a roll-out to more states will be made later, he added.

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