Michelob Soars in the Space Age
From 1951 through to 1977 Anheuser-Busch enjoyed almost interrupted sales increases, sales dominance, and good profitability. This table extract shows shares of national barrelage (all brands) for major producers in that period (The Brewing Industry: Staff Report of the Bureau of Economics, Federal Trade Commission, 1978, p. 22):
In 1961 Anheuser-Busch shipped 8,500,000 bbl, of which 7,100,000 were Budweiser, 1,100,000 Busch Bavarian, and 300,000 Michelob (Printers Ink, Vol. 278, 1962).
For Michelob, this was mostly draft beer, as bottling only started late in 1961 and the format was new. Hence the small shipment considering too Michelob was extra-priced and distributed selectively.
In 1968, all Anheuser-Busch brands shipped rose to 13,600,000 bbl (Marketing/Communications, 1967, p. 28).
By 1977, Anheuser-Busch is shipping 25,000,000 bbl of Budweiser, 6,400,000 of Michelob, and 3,400,000 of Busch (Beverage Industry, Vol. 74, 1983, p. 31).
As noted, in 1961, a pasteurized bottled version of Michelob was issued, meant for national distribution, and both it and the draft were lightened with rice adjunct.
A news ad of March 1962 in the Evening Star of Washington, D.C. (via Chronicling America) displayed the new bottle, a striking contemporary design. As signalled in the ad, the brand was still in limited distribution, but that would soon change.
The steady climb in Michelob sales was due to wide distribution of the bottled version and a determined advertising push (The Advertising Age Encyclopedia of Advertising (2002), ed. John McDonough and Karen Egolf, p. 77).
An interesting side-effect, noted by Victor and Carol Tremblay in The U.S. Brewing Industry: Data and Economic Analysis (2005), p. 107, is bottling and extended promotion of Michelob opened the door to greater import sales. They do not state it as such, but the implication is, the change of formulation made Michelob less appealing as an import substitute than earlier.
Still, Michelob remained virtually alone in the super-premium, or highest-priced domestic category. That would change somewhat when Miller introduced Lowenbrau in 1975 as a domestic brew, but Lowenbrau never made great inroads on Michelob’s market.
The span in question, 1950s to mid-70s, was one, too, that appreciated the full-calorie Michelob. Lightened it may have been, but it was not a “light” – Michelob Light was only introduced in 1978.
Perhaps due to the formula change, Michelob would seek newer demographics, or rather the reverse, more likely.
Before 1961 Michelob might be found in an Ivy League or other college setting, in seafood restaurants, the country club, and better hotels and bars. In general, an upmarket image prevailed, while the separate ethnic market continued, for a time.
Beer nerds also sought the beer – the general maven market.
But the advertising would seek markets beyond these. The ad above shows an element of the newer strategy: Washington politicians, drawn from all over the country, and world diplomats and their staff.
Part V follows.
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