4. 1852 – George Schneider opened Bavarian
Brewery in St. Louis, IL
1860 – Schneider sold the brewery to William
D’Oench & Eberhard Anheuser
Ran brewery under E. Anheuser
D’Oench sold his half to Adolphus Busch
6. Innovators in all aspects of business
Transportation, bottling, &brewing
1870s - implemented a new brewing style from
the town of Budweis, Czech Republic
1876 – Release of Budwesier
7. 1879 – Named Anheuser-Busch Brewing Association
1880 – Anheuser passed away, Busch named president
Busch pushed for expansion in every aspect of business
1913 – Busch passed away, son named president
8. August Anheuser-Busch Sr. era
1920 - Prohibition hits the United States
Other opportunities?
9. 1957 – Named largest brewer in the United States
Family owned and operated until 2008
2008 – InBev purchased Anheuser-Busch for $52
billion
Anheuser-Busch is St. Louis
10. 2013 revenue of $43 billion, profits of $16.5 billion
Market Share
United States – 47%
Canada – 40%
Mexico – 58%
Brazil – 68% beer, 18% soft drink
Argentina – 78% beer, 21% soft drink
Belgium – 56%
11. Often imitated but never duplicated
Focus
Quality
Innovation
Marketing
Acquisitions
Compliments other business aspects to
allow for growth
12.
13. • New York Stock Exchange – BUD
• $43.2 billion in revenue
• $142 billion Total Assets
APPENDIX 1 (AB Inbev Segment Revenues)
Market
Revenue
(USD million)
Revenue
(% of Total)
Revenue
(USD million)
Revenue
(% of Total)
Revenue
(USD million)
Revenue
(% of Total)
North America 16,023 37.10% 16,028 40.30% 15,304 39.20%
Mexico 2,769 6.40% — — — —
Latin America North 10,877 25.20% 11,268 28.30% 11,350 29.10%
Latin America South 3,269 7.60% 3,209 8.10% 2,878 7.40%
Western Europe 3,620 8.40% 3,625 9.10% 3,945 10.10%
Central & Eastern Europe 1,445 3.30% 1,668 4.20% 1,755 4.50%
Asia Pacific 3,354 7.80% 2,690 6.80% 2,317 5.90%
Global Export & Holding Companies 1,839 4.20% 1,270 3.20% 1,496 3.80%
Total 43,195 100.00% 39,758 100% 39,046 100%
*AB InBev 2013 annual report pg. 34
2013 2012 2011
14. • “Stitching”
– 663,074,830 shares, which represented a 41.24%
voting interest
• 521 institutions own 58%
• 379 Funds own 2.86%
16. • ROA
• 11.6%
• Financed
• 1.56 debt to equity
• inventory turnover
• 5.96 times per year (61 days)
17. Industry Description
• Part of the brewing industry
• Varies in size
• 4 companies = 90% of industry
revenue
• Highly concentrated
• Increasing popularity of
craft beer
18. Rivalry Within Industry
(Medium)
• Plenty of companies; few with
significant global market share
• Compete for consumer tastes
• M&A’s to eliminate competition
and gain market share
• Growing craft beer market
• 10% growth
• 7% U.S market share
19. Supplier Bargaining Power
• Large companies have more
influence on price
• Large volumes purchased
• Market is saturated with
suppliers
• Easy to change supplier
• Small breweries have less
influence on price
• Smaller volumes
purchased but,
• May buy locally
• Lower shipping costs
• Close relationship
20. Threat of Substitutes (High)
• Wine, hard-liquor, soft drinks,
etc.
• Price ceiling on beer
• Price-performance trade-off
• Willing to pay more for a
certain feature
21. Buyer Bargaining Power (Medium-
High)
• Three-tier distribution system
• Distributors are gateway to end-
user
• Have more control over price
• Prevent breweries from over-
charging customers
22. Threat of New Entrants (Low-
Medium)
• Microbreweries entering the
market everyday
• Limited shelve space
• Overshadowed
• Easy to enter the market, hard to
get established
23. • Continue to innovate; adjust to
consumer taste
• Line extensions, new liquids,
new marketing
• “Open Innovation” concept
• Maintain strong brand image
• Continue building a strong,
diverse brand portfolio
• Use strategic M&A’s to gain
new customer segments
24. National Beer Wholesalers Association
• Founded in 1938
• 3,300 licensed, independent beer distributors across the US
Employment
• 345,000 direct and indirect jobs
• 130,000 full time employees
National total value of production
• $54 billion per year
• $10.3 billion per year in federal, state and local taxes
• $11 billion per year in alcohol, excise and consumption taxes
25. Alcohol Regulation
• 21st Amendment - authority to the state to regulate the sale of
alcohol.
• The Three Tier System - provides transparency and traceability
Innovation & Technology Committee
• Global Data Synchronization, shared services, green solutions,
monitoring technologies and e-commerce.
LICENSED
DISTRIBUTOR
LICENSED
RETAILERS
Responsible
Consumers
of Legal
Drinking Age
BREWER OR
IMPORTER
26. Conservation Actions
• In their facilities, on the roads and in the marketplace.
• Saving money through environmental initiatives
Recycled Point-of-
Sale Material
Hybrid, Biodiesel &
Compressed Natural Gas Beer
Delivery Trucks
Solar Energy Powers
Warehouses
Energy efficient bulbs and
Motion sensors
27. Who are our customers?
What do we know about them?
34. Variety of Marketing Strategies to
Achieve Emotional Connection with
Consumers
Long & Prestigious History of Marketing
Excellence
35. Adolphus Busch was Master of
Advertising & Branding
Pioneered Coordinated, Multi-year Ad
Campaigns, Point of Sale Advertising &
Giveaways
Used Branded
Pocket Knives
instead of
Calling Cards
36. Epic Super Bowl Advertising Campaigns
Biggest Event in Sports & Advertising
$4 Million per 30 Seconds of Ad Time
2014 AB InBev spent $28 Million
5 of 16 Best Super Bowl Commercials of
all Time Belong to AB InBev Products
42. Strategy Based on 3 Socially Responsible Platforms
Responsible Consumption of Alcohol
Preservation of the Environment
Emergency Disaster Response
Invested $1.4 Billion since 1982
43. Responsible Consumption of Alcohol
First Campaign
Launched in 1982
2013 Blimp
Campaign
New Year’s Eve
Campaign
44. Responsible Consumption of Alcohol
Resources for Parents to Help Them Discuss
Underage Drinking with Children
45. Preservation of the Environment
Reduced Water Use in Breweries by 40% Last 5 Years
Average Recycling Rate of 99.6% at All Facilities
Utilize Alternative Energy Sources
60% of Fuel at Houston Brewery from Methane
Produced at Nearby Landfill
46. Emergency Disaster Response
MAY 2014
Joined
American Red
Cross’ Annual
Disaster
Giving
Program
$500,000 for Food,
Shelter, Health Services
$250,000 for Support of
Blood Services
47. Emergency Disaster Response
72 Million Cans of
Drinking Water
Donated to
People Impacted
by Natural &
Other Disasters
Since 1988
50. Experiential Marketing
Hottest New Trend in Marketing
Creativeguerillamarketing.com
Experiential 101: What is Experiential Marketing
“Helping Consumers Experience a Brand by
Engaging as Many Human Senses as
Possible to Create Customer Loyalty &
Influence Buying Decisions”
51. Experiential Marketing
Julia Mize, Vice President
Experiential Marketing
Anheuser-Busch InBev
Named VP in 2013
Newly Created Position
Revolutionize Experiential
Marketing Methods
2014 Award for Best
Production of an Event
(Consumer) for Bud Light
50/50/1
54. Experiential Marketing
March 2014
Ballpark Village in
Downtown St. Louis
26,000 Ft2 on 3 Levels
Restaurant, 11 Bars
Rooftop Deck
21’ Long Tap Wall—
Swipecard for Self-Serve
200 Beers on Tap
52 High Def TVs
55. Marketing Recommendations for Global Expansion
Clydesdales Will Most Likely Not Be as Effective
Sporting Events Such as Cricket
Socially Responsible Platforms Relevant to Market
Underage Drinking Not as Relevant in Latin
America (Legal Drinking Age of 18)
Disaster Response in Foreign Markets
Focus on the Environment in Foreign Markets
Open Breweries with Tours in Foreign Markets
Promote International Events with Bud Light Hotel
Partner with Other International Organizations
56. The world’s biggest beer consumers
• Asia-Pacific’s brewing industry
is worth $258 billion
• The beer market is growing
2 times more than the rest
of the world
• There are 57 million new
consumers each year.
• Premium segment is growing
2.5 times faster than the
overall industry.
Fast emerging economies
"Beer has a clearer correlation
with strong economic growth”
Nirgunan Tiruchelvam
(Consumer Research Analyst)
Globalization
Half of the world’s population
(around 3.8 billion people)
58. • Since 2011, AB InBev has acquired
important breweries in China
• The company’s growth in China is
mainly being driven by
Budweiser, Harbin and Sedrin
brands
• During 2012, AB InBev's beer
sales by volume in Asia Pacific
grew by 1.9% and revenues per
hectoliter increased by 10.6%
59. • Continue actively expanding its production capabilities in regions
across China and other countries in Asia-Pacific
Recommendations
• Continue specially focused on leveraging the increasing spending
power of consumers in Asia-Pacific by targeting the premium segment
• Consider to expand on other beer brands on this market.
60. • Mexico is the world’s 6th-largest beer producer and beer consumer.
• Mexicans drink an average of 62 liters of beer a year
• The beer market in Mexico is growing quickly
• The beer production increased 8% from 7.9 B liters in 2010 to 8.6 in 2012
• The beer market is expected to reach a value of $22.1 billion by 2017
61. • Expected increase in beer demand is primarily driven by factors like:
• robust population base in urban areas,
• strong gross domestic product growth, and
• rising middle-income group and consumer spending.
• Last year the company acquired Grupo Modelo, which is the largest
brewery in Mexico with 63% of the Mexican beer market
62. • Take advantage from the significant growth potential that Modelo
brands have all over the world
• Introduce AB InBev brands in Mexico through Modelo’s distribution
network
Recommendations
Hinweis der Redaktion
2.5 times larger then SAB who had 56 billion in assets
BUD has about 10 million more shares outstanding 1.61B vs 1.60
MillerSAB only had a 6.2% return on its assets
MillerSAB on the other hand has a 1.09 debt to equity ratio
AB InBev is able to cover 72.9% of its current liabilities with their current assets. MillerSAB only maintains a current ratio of 66.9%.
MillerSAB and an inventory turnover of 6.62 times per year.
- The 21st Amendment was ratified by the congress in 1933 and it creates absolute authority on the state to determine how to regulate the sell of alcohol.
- The state establish the state-based Three Tier System for alcohol distribution that still in place and effective today. The 1st Tier is the Brewer or the Importer, they sell only to Licensed distributors that are licensed by both the state and the federal government. Distributors sells only to licensed retailers. Licensed retailers sells only to responsible consumers of legal-drinking age.
- The system has worked successfully for 80 years across the US. It provides transparency and traceability, and that it’s critically important specially in this times when consumers are exposed to news dangerous products from counterfeit alcohol in other countries to contaminated beef, spinach, and tomatoes right here at the US.
- The American system of alcohol distribution works to ensure that only safe, unadulterated alcohol beverages get to retailers.
Source: https://www.youtube.com/watch?v=mNWxkZNmHGQ
- The NBWA has an Innovation & Technology Committee that is responsible for discussing trends in the beer distribution industry on different issues, such as: Global Data Synchronization, shared services, green and sustainable solutions, alcohol detection, monitoring technologies and e-commerce.
These technologies can save thousands of dollars a year in energy costs while saving the environment millions of kilowatts in unnecessary energy expenditures.
Since 2011, the company has acquired important breweries in China, expanding significantly its production capabilities in this region.