AB InBev to boost marketing spend further as Budweiser and Stella sales continue to lag

Ab InBev will increase its marketing investment by “high single to low double digits” in 2016, as its core brands, including Budweiser and Stella Artois, missed estimates despite a ramped up ad spend on the brands during 2015.

While the brewer saw revenue of its grow by 6.6 percent in the fourth quarter to $4.31bn, that figure missed analyst’s estimates of 9.2 percent gain, according to Bloomberg figures. Budweiser continued to struggle in the US, where profits fell by 7 per cent, notwithstanding a 9.4 per cent increase in marketing for the full year 2015.

The figures highlight the need for the soon-to-be completed $100bn acquisition of rival brewer Sab Miller, through which Ab InBev will be able to tap in to new areas of growth in Africa and Latin America as beer drinkers in the US and Europe increasingly turn their attention to the craft beer movement.

Ab InBev has been trying to grow its position in the craft space across its global markets and in 2015 went on a craft beer bender, acquiring three breweries in the space of just five days last December, including the controversial takeover of UK-based Camden Town Brewery, which sparked a furore among fans and fellow independent brewer Brewdog.

To understand the changing behaviours of consumers Ab InBev said it has created a ‘Disruptive Growth’ team that the brewer said in a results release will “explore opportunities beyond the traditional areas of brands, brewing or marketing campaigns”, such as how technology can enhance packaging and consumer experience.

As part of this Ab InBev is already piloting craft e-commerce platforms to allow consumer to order beer for quick delivery in Mexico, Brazil and Canada, and revamped the packaging for Budweiser and Bud Light globally.

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