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A-B Launches Bud Select Nationally

Feb 28, 2005 - Escalating a fight for domestic market share with its chief rival, Anheuser-Busch Cos. Inc. last week launched nationally a low-carb, low-calorie cousin of top-selling Budweiser and Bud Light beers.

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The St. Louis-based brewer said Budweiser Select offers a "sophisticated drink option," crediting what it called the beer's darker color and crisp finish to spending twice as long as regular beers in the brewhouse.

Marketed under a tagline of "crisp taste with no aftertaste," Budweiser Select -- priced similarly to Budweiser and Bud Light -- has 3.1 grams of carbohydrates, 99 calories and 4.3 percent alcohol by volume per 12-ounce serving, the company said.

The latest brew hopes to tap some of the success enjoyed by the company's low-carb Michelob Ultra, which since its unveiling a few years ago has become a hit among diet-conscious drinkers, forcing other beermakers to respond with their own carb-friendly brews.

"Anheuser-Busch has been an innovator for more than 100 years, and we continue to deliver exciting new products to consumers that raise the sophistication of beer," said Don Meyer, Anheuser-Busch's chief of Budweiser Select marketing. "As the industry leader we work everyday to bring excitement, sophistication and more consumers to the beer category."

Anheuser-Busch introduced the beer in TV commercials during the Super Bowl, prompting rival Miller Brewing Co to pre-emptively mock the new brew as a sign of Anheuser-Busch's weakness in an increasingly crowded market.

In a statement issued late last month, Miller -- a division of London-based SABMiller PLC -- said news of Budweiser Select's arrival "confirms the long-running speculation that Anheuser-Busch would introduce a new lager designed to perform better than Bud Light in direct competition with Miller Lite, particularly on the aspects of color, taste and carb count."

Bob Mikulay, Miller's executive vice president for marketing, said Budweiser Select is a "clear admission that Anheuser-Busch knows it has real disadvantages with original Bud and Bud Light."

"America's beer drinkers are increasingly turning to Miller Lite, and that's forced Anheuser-Busch to bring out a new Bud," Mikulay said.

Miller said ACNielsen supermarket data shows that last year, Miller Lite sales grew by 11.9 percent while sales of Bud Light rose 1.7 percent and sales of Budweiser fell 7.5 percent. Part of the problem for both brewers: Wine and distilled spirits continue to gain bigger shares of the alcoholic beverage market.

In announcing its fourth-quarter earnings earlier this month, Anheuser-Busch said its domestic beer sales were flat at $3 billion, up slightly from $2.98 billion a year earlier. Domestic beer volume, 22.9 million barrels, declined 1.5 percent from a year ago.

The company's share of the domestic beer market slipped to 49.6 percent from 49.7 percent.

Anheuser-Busch executives told analysts this month that Budweiser Select was important in the company's hopes of boosting its volume of domestic beer shipments by at least one percent this year.

Anheuser-Busch said Budweiser Select would be brewed at seven of its dozen U.S. breweries.


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