With CMO out amid sagging sales, AB InBev appears to be planning post-controversy comeback
Experts are shocked that Benoit Garbe’s resignation didn’t come sooner.
Bud Light sales have been crushed in recent months, with Modelo unseating the brand as America's favorite beer / Adobe Stock
Anheuser-Busch (AB) InBev announced last week that its US chief marketing officer Benoit Garbe is resigning from the company.
The decision, made in light of slumping sales, has come later than experts expected. It could, however, hint at the company’s intentions to stage a strategic turnaround following months of turmoil.
The beer behemoth has suffered reputational and financial damage since its botched response to conservative blowback over a Bud Light partnership with trans activist Dylan Mulvaney in April. The company’s US revenue was down 13.5% year-over-year, with sales to wholesalers and retailers both down by around 17%, according to an earnings report filed in October.
“The Bud Light debacle contributed to a nearly 30% decline in Anheuser-Busch InBev’s adjusted earnings – and deep discounts didn’t help,” says Robert Passikoff, founder and president of brand consultancy and research firm Brand Keys. “The only thing that’s surprising is that it took this long for CMO Benoit Garbe to resign. Apparently [Garbe is] embarking ‘on a new chapter in his career,’ which is not-so-subtle corporate code for ‘he was asked to leave.’”
The notion is echoed by other experts. “It’s surprising [that the resignation is] happening now, and not earlier in the initial response. This needed to have happened much earlier in the process,” says Dr Karen Freberg, a marketing expert and professor of strategic communications at University of Louisville.
Garbe is expected to leave the company at the end of the year, AB InBev said in a press release.
The move is especially surprising considering that other executives involved in the controversy were pushed out in the immediate aftermath of the Mulvaney controversy. Both Alissa Heinerscheid, vice-president of marketing for Bud Light and Daniel Blake, head of marketing for AB InBev’s mainstream brands, went on leave in late April. At the time, the organization said in a statement that the decision “will help us maintain focus on the things we do best: brewing great beer for all consumers, while always making a positive impact in our communities and on our country.” It has since been reported that both executives have officially left the company, though AB InBev has not confirmed the status of their employment.
In any case, it’s clear that AB InBev is still attempting to turn around its fortune – with Garbe’s departure signaling broader change. “[This] is a step for the brand to separate and close this chapter with the Bud Light crisis,” Freberg says.
The company’s lukewarm response to conservatives’ reactions to the Mulvaney partnership – a response that failed to defend Mulvaney or the decision to work with her – paired with a lack of urgency in remedying the situation, has put AB InBev on a back foot, Freberg says. “The company should have been proactive, responsive and clear on where they are going and what they will do in the future.”
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Other marketing and PR experts offer a more damning assessment of what went wrong. “I keep going back to what AB InBev CEO Michel Doukeris said during an earnings call last summer: that customers ‘want to enjoy their beer without a debate.’ Just so we’re clear, the so-called ‘debate’ Doukeris was talking about is whether or not trans people deserve to live,” says Andrew Graham, founder and head of strategy at Bread & Law, a New York-based PR firm. “I get that this isn’t on the list of things the brand wants to talk about, but it would have been extraordinarily low-hanging fruit for Bud Light to disavow hate speech in all of its forms before returning to the friendly confines of country music and professional sports.”
AB InBev’s decision to try to appease both anti-trans and progressive consumers in the aftermath of the backlash, Graham says, ultimately hurt its image and bottom line. “What drove Bud Light sales into the ground wasn’t an anti-trans hate campaign perpetuated by a handful of goons. What drove Bud Light sales into the ground was the company’s cowardly, tone-deaf response to it.”
Moving forward, Bud Light and AB InBev need to assess its customer base carefully and take a real stance on issues like trans rights, Graham says. “When a brand gets attacked by political radicals, political neutrality is no longer an option, and apologizing only makes their radicalism succeed,” he says. “A brand can’t both-sides its way out of that situation. And a brand can't spend decades touting its strength and history only to cower away in fear the moment that Ben Shapiro or Tucker Carlson says something critical about it.”
Restoring trust among consumers is sure to be an uphill battle for Bud Light and AB InBev.
Freberg, for her part, stresses the importance of approaching customers with “an honest, transparent and forward-thinking approach” – while taking accountability for what went wrong. “It’s key to acknowledge what happened, what’s next and how everyone – fans, customers, retailers, vendors, employees and brand – all are on the same page in wanting to move the brand forward together.”
In the meantime, Bud Light has lost its title as America’s favorite beer. In May, sales data indicated that Modelo had unseated the light beer; later data found that the Mexican beer was still outselling Bud by mid-August.
Brand Keys’ Passikoff says that, in essence, AB InBev “mishandled the controversy.” He adds: “It’s going to take forever to come back from this.”
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