Anheuser-Busch Sale Casts Shadow on TV Spend
Sale of one of TV’s largest advertisers will eventually lead to review of its longstanding media-buying strategies.
By Robert Marich -- Broadcasting & Cable, 7/14/2008 9:29:00 AM
One of TV’s largest advertisers is being sold -- beer giant Anheuser-Busch -- which will eventually lead to a review of its longstanding media-buying strategies.
Publicly traded A-B agreed to sell itself for about $52 billion Monday to Belgium-based InBev, which is taking advantage of the weak dollar to buy an iconic U.S. brand.
While large shareholders have lined up in support of the deal, the sale is getting flack from politicians, especially from Missouri, where the St. Louis-based brewer of Budweiser is headquartered. And A-B is a big and highly regarded corporate charitable donor.
According to trade newspaper Advertising Age, A-B was the nation’s 22nd-largest national advertiser in 2007 with $1.35 billion in U.S. ad spending, of which $341 million was in TV. It is the top-ranked beverage marketer ahead of PepsiCo (No. 26), Coca-Cola (53) and SABMiller (86).
In media buys, A-B’s spending includes being the biggest Super Bowl advertiser from 1987-2006 with $250.8 million in outlays, according to an analysis from TNS Media Intelligence. That put Bud-related ads ahead of next-ranked PepsiCo, General Motors and Time Warner.
Elsewhere, A-B was also the third-largest advertiser in coverage of the NCAA college-basketball tournament from 2000-06 with $96 million in outlays, trailing only General Motors and AT&T, according to TNS.
Analysts predicted that fallout of InBev’s acquisition will include a reduction in beer-price wars that erupted from time-to-time between the two largest U.S. brewers, since InBev has a history of being more concerned about profitability and cost control than market share.
A-B holds an estimated 48.5% share of U.S. beer sales. Its main rival, Miller Brewing, accounts for a roughly 30% market share and is also foreign-controlled as a unit of London-based SABMiller.
InBev brews popular U.S. imports Stella Artois and Beck’s, and its other big brands overseas are Bass and Hoegaarden.
The company itself is a product of a 2004 merger of Interbrew of Belgium and AmBev of Brazil.
Monday’s deal -- the third-largest foreign takeover of a U.S. company -- is subject to normal regulatory clearances. The two companies have few geographic overlaps that would pose obvious antitrust obstacles.
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