Brewing giant Anheuser-Busch is facing challenging times as it grapples with the aftermath of its controversial partnership with transgender influencer Dylan Mulvaney. The ill-fated collaboration has resulted in a loss of market value and a significant drop in sales, prompting the company to take drastic measures to streamline its operations and cut costs. As part of this effort, the company has announced plans to lay off around 2 percent of its US workforce, affecting approximately 380 employees.
Anheuser-Busch CEO Brendan Whitworth released a statement outlining the difficult decision, emphasizing that the restructuring is essential for the organization’s long-term success. The affected employees will receive severance pay, continued health insurance benefits for six months, and assistance in finding new job opportunities. Notably, frontline workers such as brewery and warehouse staff, drivers, and field sales representatives will be spared from the layoffs.
The root cause of the company’s troubles can be traced back to the partnership with Dylan Mulvaney, which sparked controversy among both conservative and liberal drinkers. The collaboration, which took place in April, led to a staggering $27 billion decline in market value and resulted in two top executives taking a leave of absence. The ill-fated marketing campaign also had a profound impact on the perception of Bud Light in the public eye, causing it to lose its position as one of the top ten beers in the US by dollar sales.
A YouGov poll conducted during the second quarter of 2023 revealed that Bud Light’s popularity suffered a significant blow, falling to 15th place among American consumers. While the proportion of Americans who ‘liked’ Bud Light remained stable, the approval ratings of rival beers surged, pushing it down the ranks. Guinness, Corona, and Heineken emerged as the top three most liked beers, with approval ratings of 58 percent, 53 percent, and 51 percent, respectively.
Meanwhile, Modelo, owned by Constellation Brands but distributed by Anheuser-Busch, experienced an 11 percent increase in sales during the second quarter of this year. This surge propelled Modelo to overtake Bud Light as the best-selling beer in the US, ending Bud Light’s reign of more than two decades.
The fallout from the partnership with Dylan Mulvaney highlights the delicate nature of navigating cultural and political issues in marketing campaigns. Anheuser-Busch faced backlash from both ends of the spectrum, leading to boycotts and alienating a significant portion of the market. As consumer preferences shift, it has become clear that America’s appetite for beer remains robust, but the landscape is evolving, and companies must adapt to stay relevant.
The road ahead for Anheuser-Busch will undoubtedly be challenging, but the company remains committed to its core mission of brewing great beer for everyone. As it seeks to weather the storm, the company’s restructuring efforts aim to ensure long-term viability and success while refocusing on its core strengths. The beer industry continues to evolve, and Anheuser-Busch is determined to navigate these changes strategically, restoring its reputation and retaining its place as a leading player in the market.