DEE-ANN DURBIN, Associated Press
18 minutes ago
Cans of Modelo Especial beer are displayed at a supermarket in New York, Wednesday, June 14, 2023. After more than two decades as America’s best-selling beer, Bud Light has slipped into second place. Modelo Especial, a Mexican lager, overtook Bud Light in US dollar sales in the month ending June 3. (AP Photo/Peter Morgan)
After more than two decades as America’s best-selling beer, Bud Light has slipped into second place.
Modelo Especial, a Mexican lager, overtook Bud Light in U.S. dollar sales in the month ended June 3, according to Nielsen data analyzed by Bump Williams Consulting. Modelo controlled 8.4% of grocery, convenience and liquor store sales in the United States; Bud Light fell to 7.3%.
Grupo Modelo, the Mexican brewer, is owned by Anheuser-Busch InBev, the same parent company of Bud Light.
It’s a milestone in Bud Light’s months-long sales slump since early April, when critics angered by the brewer sending a commemorative box to transgender influencer Dylan Mulvaney vowed to boycott the brand. Bud Light has also faced backlash from Mulvaney’s fans, who believe the brand did not do enough to support her.
Dave William, Bump Williams’ vice president of analytics and insights, said Bud Light has been the top-selling U.S. beer since 2001 and could still retain that crown this year. He noted that Bud Light’s 9% year-to-date market share still outpaces Modelo’s, at 8%. And Bud Light’s sales volumes are higher.
But Modelo appears to have the edge, with dollar sales increasing by double-digit percentages each week. The launch of a new light beer, Modelo Oro, in May also increases awareness of the brand.
Sales at bars and restaurants, which are harder to track, are not included in the retail figures, and Bud Light far outpaced Modelo in those locations before April. But David Steinman, vice president and managing editor of Beer Marketer’s Insights, said Modelo’s bar and restaurant sales have grown rapidly, and it’s believed Bud Light took an even steeper sales hit in bars and restaurants than in grocery.
Bud Light’s U.S. retail sales fell 24% in the week ending June 3, while Modelo Especial sales rose 12%, according to Dave Williams.
Scott Scanlon, an executive vice president at consulting firm Circana, which tracks the alcohol market, said Mexican imports like Modelo and Corona have been the biggest bright spots in the otherwise stagnant U.S. beer market for years.
When Modelo was first sold in the United States in the 1990s, it was primarily marketed to Hispanic drinkers, Scanlon said. It launched English-language ads in 2015 and has grown its consumer base significantly since then. It’s especially popular with younger drinkers, who like the fuller flavor, Scanlon said.
Scanlon said Modelo is already the top seller in markets like Los Angeles and Chicago, but it could still see a lot of growth going forward on the East Coast.
“Modelo was going to be the No. 1 beer brand. It was destiny because the growth numbers we see and have seen are astounding,” Scanlon said. “The only question was time.”
Scanlon said the pandemic accelerated Modelo’s U.S. sales, as it sees more of its sales from retail stores than from bars and restaurants. And Bud Light’s misstep accelerated its rise even further.
Constellation Brands, a Rochester, New York-based company licensed to sell Modelo in the U.S. since 2013 as part of a deal with antitrust regulators after InBev bought Grupo Modelo, said Wednesday it has nearly doubled its marketing spending on Modelo during the past five years and continues to see a “growth runway” in the US, but Bud Light will try to counter that.
Last month, InBev said it would triple its marketing spend in the US this summer, focusing on sports and music festivals. Bud Light also continues to be a high-profile sponsor of LGBTQ+ Pride events.
“For the year, Bud Light remains the number one brand in the United States nationally in volume and dollar sales,” an Anheuser-Busch spokesperson said Wednesday.