MONEY

Bud light sales, Dylan Mulvaney's beer ad and whether boycotts actually work

Bailey Schulz
USA TODAY

Anheuser-Busch parent company AB InBev is optimistic about its future, despite calls for a Bud Light boycott after a marketing partnership with transgender influencerDylan Mulvaney.

CEO Michel Doukeris noted Thursday that while Bud Light volume declined in the U.S. over the first three weeks of April after the uproar, the dip represented just 1% of overall global volumes for the period.  

“With respect to the current situation and the impact on Bud Light sales, it is too early to have a full view,” Doukeris said. But “in the context of our global business, we believe we have the experience, the resources and the partners to manage this." He added that the company's full-year growth outlook for earnings before interest, taxes, depreciation and amortization remains unchanged.

The comments raise the question: Just how effective are boycotts like the one Bud Light faces?

While boycotts can “definitely” have an influence on a company’s public image and reputation, there is less evidence that boycotts have a long-term effect on sales revenue, according to Brayden King, a professor of management and organizations at Northwestern University’s Kellogg School of Management.

“I would expect it to be very short-term,” he said. “Eventually, people are going to get tired of (a boycott) and move on to the next thing.”

Still, it’s possible the company sees a sales dip “for a long period of time,” according to Stephen Pruitt, a professor of economics and finance at the University of Missouri-Kansas City who co-wrote a 1986 paper that studied the share prices of firms at the center of 21 boycotts. 

“People sometimes have long memories, especially associated with something like this that’s so politically charged,” Pruitt said. “It'll be interesting to see how this one eventually does work out.”

Cans of Bud Light beer are seen, Thursday Jan. 10, 2019, in Washington.

AB InBev earnings

AB InBev reported earnings of 65 cents a share on $14.2 billion in total revenue, up 13% year over year. This surpassed analysts’ expectations of 59 cents a share on revenue of $14.1 billion.

The results take into account earnings from the first three months of the year, right before Mulvaney’s promotion was posted to Instagram on April 1.

The chief executive said on Thursday's earnings call that it’s too early to understand the duration and total impact of the boycott, but it has mostly affected Bud Light sales, with “some spillover effect” across other brands.

Doukeris said AB InBev is providing “direct financial support” to front-line teams working for the company and its wholesalers and will be tripling media spending for the Bud Light brand over the summer.  

Despite the dip, Doukeris said, the company is seeing signs of “some stabilization" in day-to-day sales data.

AB InBev is "fully committed to get our plans and our brands and portfolio to rebalance," Doukeris said. "We are investing to make this happen."

'It's really easy to switch brands'

King said Bud Light sales could be taking a hit in part because so many beer sales are made in public spaces like concerts or bars, where consumers may feel pressured by peers to avoid the products. 

And boycotts against brands like Bud Light are easy to take part in because the beer has so many competitors, Pruitt said.

“It's not like there are no substitutes for this product,” he said. 

Though experts say boycotts often fail in the long run, there are success stories.

Take the 1977 Nestle boycott over the company's marketing practices around infant formula in developing countries. It wasn't until 1984 that the boycott was suspended once Nestle agreed to comply with the World Health Organization's baby formula sales code.

Anheuser-Busch has made some changes since the boycott launched. The company said last month that two executives had taken a leave of absence after the backlash: Alissa Heinerscheid, who oversaw Bud Light marketing, and her boss, Daniel Blake, who was in charge of the marketing for Anheuser-Busch’s mainstream brands.

Doukeris also said Thursday that the company will have its marketing focus on sports and music.

Just how effective are boycotts?

The boycott mostly stems from conservative beer drinkers who feared the company was turning “woke,” although the brand has also received some pushback from the LGBTQ+ community. John Casey, a senior editor at the LGBTQ+ news outlet The Advocate, called for a boycott of Budweiser after he says a statement in April from Anheuser-Busch’s CEO failed to stand up against the hate directed at Mulvaney.

NEW YORK, NEW YORK - MARCH 03: Dylan Mulvaney speaks onstage at PFLAG National 50th Anniversary Gala at Marriott Marquis on March 03, 2023 in New York City.

Despite the blowback, AB InBev noted in its earnings report that it continues to grow the average percentage of customers purchasing its products.  

“The beer industry is very good at segmented marketing,” said Allyson Brantley, an associate professor of history at the University of La Verne and the author of “Brewing a Boycott. “So if they lose one segment of their market, even if it seems to be, in the mind of the public, the main market, they have lots of other markets and consumers that they have built relationships with.” 

It can be difficult to make a boycott eat into long-term sales. Chick-Fil-A is one example of this: The fast-food chain has more than doubled its annual sales since people started calling for a boycott to protest its donations to organizations opposed to same-sex marriage.  

Boycotts "can only be effective if they're well organized and have clear messaging,” Brantley said, adding that this is rarely present in social media-driven spurts of outrage. So far, she said, there hasn't been evidence of an organization stepping up to put out consistent messaging and demands to help drive the Bud Light boycott.

"It's very much a sort of knee-jerk reaction," she said. "If you're only boycotting one brand in the massive portfolio of AB InBev and you only do it for a while, it would be difficult for it to have a long-term impact."

It’s not clear whether the Bud Light boycott will have an effect on inclusive advertising at large.

Even though Doukeris’ comments seemed to distance the company from its partnership with Mulvaney – the CEO repeatedly emphasized that the influencer’s Instagram video was a single post and not a formal campaign – marketing experts say inclusive ads are good business and here to stay, according to The Associated Press.  

Is it worth boycotting?

So if many boycotts fail to have long-term effects, does that mean they’re not worth attempting?

Not necessarily, according to Brantley. 

“Consumer activism is powerful, and consumers can register political dissent in a variety of ways through their purchasing decisions,” she said. “If you're just doing something individually, yeah it’s probably not going to make a huge difference, but it might make a difference to you. And that's important too.”

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