Anheuser up, SABMiller down in US beer battle

By Chris Mercer

- Last updated on GMT

Related tags Beer Alcoholic beverage

Anheuser Busch managed to stop the rot on the troublesome American
beer market during the first half of 2006, but hopes of a
sector-wide recovery were dashed by a sales slip from rival

Anheuser Busch increased its US beer volumes by 3.4 per cent for the first six months of 2006. Sales to retailers also rose 1.8 per cent thanks to an improved performance from the Bud Light brand and the group's acquisition of Rolling Rock beer.

The improved performance from Anheuser will inject a rare shot of confidence into the US beer market, where big brewers have struggled to cope with falling demand over the last couple of years.

The news comes only a week after Dutch brewer Heineken reported better-than-expected sales of its Premium Light beer in the US, which is expected to help the group beat its initial profit predictions this year.

Analysts have tipped so-called 'light' beers for further growth in the US for more than a year, because of their appeal to calorie-conscious consumers.

Both Heineken and Anheuser were further buoyed by a new Gallup Poll which re-iterated beer as America's most popular alcoholic beverage. Anheuser said promotions such as the 'Here's To Beer' campaign had helped re-connect consumers with beer.

Hopes this week of a recovery across the US beer sector were short-lived, however.

Anheuser's main rival, SABMiller, announced Friday that sales of Miller to retailers were down 2.4 per cent over the second quarter compared to the same time last year. "Miller Lite brand volumes were level. The trading environment remains highly competitive,"​ the group said.

Still, pockets of growth do exist. Alongside the 'light' beers, there were signs that foreign beers had continued to do well, with Anheuser praising its new agreement to distribute Grolsch.

Imported brands and domestically produced 'craft' beers, made by smaller breweries, have led growth on the US beer market over the last 18 months. Craft beers increased volumes by nine per cent last year, according to the Brewers Association, despite total beer sector volumes shrinking 0.4 per cent.

Part of their appeal has been their ability to romanticise beer better than the industry giants like Anheusuer and SAB, according to Tom Vierhile, editor of Datamonitor's​ new product database, Productscan Online.

He told​ recently that the big brewers needed to focus on this more if they wanted to catch up with consumer trends.

"There all sorts of things you can talk about and do to come up with a product that has a perceived greater value,"​ he said, adding that ways to do this could be focusing on "how beer is brewed, sourcing grains from different parts of the world or even using different glasses for different beers"​.

Another option open to the big brewers would be to branch out into other alcoholic drinks categories.

Anheuser has suggested it may look at other alcoholic drinks markets, such as wine and spirits, if the beer sector continues to struggle.

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