Move Over Bud Light, There's a New Top Selling Beer in America

Bud Light, after maintaining its status as America's top-selling beer for over two decades, has been relegated to the second position.

Modelo Especial, a lager originating from Mexico, ascended to the top spot in U.S. retail dollar sales in the period ending on June 3, as per the analysis of Nielsen data by Bump Williams Consulting. Modelo accounted for 8.4% of U.S. sales in grocery, convenience, and liquor stores, surpassing Bud Light which fell to 7.3%.

Notably, both these beers are under the same umbrella, with Grupo Modelo, the Mexican brewery behind Modelo Especial, being owned by Anheuser-Busch InBev – the parent company of Bud Light.

This event marks a significant juncture in Bud Light's steadily declining sales, which have been ongoing since early April. This downturn followed the brewing company's controversial decision to send a commemorative can to transgender influencer Dylan Mulvaney, leading to a pledged boycott from critics who were disgruntled by the move. Bud Light also faced criticism from Mulvaney’s followers, who believed the brand should have done more in her support.

Dave William, who is the Vice President of Analytics and Insights at Bump Williams, stated that despite its recent dip, Bud Light, which has held the best-selling U.S. beer title since 2001, could still secure this top spot for the year. He pointed out that Bud Light's year-to-date market share of 9% is still slightly ahead of Modelo's 8%, and its sales volumes remain higher.

However, Modelo seems to be in a favorable position, experiencing a consistent double-digit percentage growth in its dollar sales week on week. The introduction of a new light beer, Modelo Oro, in May has also contributed to raising brand awareness.

Although the retail figures don't account for sales in bars and restaurants, which are more challenging to monitor, Bud Light had significantly outperformed Modelo in these outlets before April. Nevertheless, David Steinman, Vice President and Executive Editor of Beer Marketer’s Insights, mentioned that Modelo's sales in bars and restaurants have been on a swift upward trend. It's suspected that Bud Light may have experienced a more severe decline in sales in these establishments compared to grocery outlets.

According to Dave Williams, Bud Light's U.S. retail sales experienced a dip of 24% in the week ending June 3, while sales of Modelo Especial saw a rise of 12%.

Scott Scanlon, an Executive Vice President at Circana, a consulting firm specializing in the alcohol market, pointed out that Mexican imports such as Modelo and Corona have consistently been the silver lining in the otherwise stagnated U.S. beer market for quite some time.

Scanlon noted that when Modelo was first introduced to the U.S. market in the 1990s, its primary target audience was Hispanic consumers. However, the brand expanded its consumer reach significantly after launching English-language advertisements in 2015. Particularly among younger demographics, Modelo has grown in popularity due to its richer flavor profile.

Modelo, Scanlon highlighted, is already the leading beer brand in markets like Los Angeles and Chicago. However, it still has significant potential for further expansion, especially on the East Coast.

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