Competitive Intelligence

Miller Lite vs. Coors & Bud: the Low-Carb Campaign & Lite's Sudden Sales Surge

Miller Lite's pushing its low-carb qualities, playing to the diet trends of the past few years, has it seeing a dramatic sales increase lately challenging Coors Light, which finished last year as the country's number two beer, to top brew Bud Light. Here's an excerpt from AdAge:

Sales for long declining Miller Brewing Inc. brand have risen in the past 13 weeks, since the brewer launched TV spots comparing its carbohydrate and calorie content to rival Adolph Coors Co. and Anheuser-Busch brands. Industry insiders credit the campaign for the boost.

"Bud Light and Coors Light are vulnerable and this is the first time we've been able to say that in years," crowed a southwestern Miller distributor.

Miller Lite's volume gain in both supermarkets and convenience stores outpaced both Bud Light and Coors Light for the 13 weeks ended Nov. 22, according to AC Nielsen data. Miller Lite rose 0.6 of a share point, while Bud Light's volume share was up half a point and Coors Light fell 0.2 share points. In convenience stores, Miller Lite's share was up 0.1 point, while Bud Light and Coors Light were flat.

More surprising, in both channels, Miller Lite drove total Miller sales up to lead the three breweries in share growth, while Coors was flat to down and Anheuser-Busch's share dropped 0.7 share points. That's a big turnaround, since Miller has declined since it relinquished the top beer spot in 1994 to Bud Light.

"It would be fair to say Miller has flip-flopped [brand positions] with Coors," said one multibrand distributor in the Central U.S.

Coors, however, isn't sitting still. Last week the brewer broke a new spot attempting to advance its own low-carb message. In the spot, Coors asserts the difference between its brand and Miller Lite is just 1.8 carbohydrate grams, which can be burned off doing a slow dance. The week before, Coors said it would launch a super-premium low-carb brand called Aspen Edge early next year.

"Some marketers are misleading consumers about carbohydrates," said a Coors spokeswoman. "Consumers ... are surprised to learn that Coors Light has only 5 grams of carbs for a 12 ounce serving."

Those close to Coors acknowledge that Miller is making a dent in their share. "Coors was down last year so this is not fair to attribute all of the softness on Coors Light to Miller but Miller has clearly exacerbated Coors problems," said an executive close to Coors.

Miller has been spending heavily to achieve the gain. The brewer has pushed out at least a dozen spots in as many weeks to promote Lite. "Spending is way up," said a Miller spokesman, to about equal "what Anhesuer-Busch spent last year at this time."

Ironically, observers credit Anheuser's Michelob Ultra for carving out the niche that is helping Miller Lite. "We were seeing 2% to 3% declines prior to Michelob Ultra and now we're seeing double digit growth," said the multibrand distributor.

"Every time Michelob Ultra runs an ad it helps Miller Lite," added the distributor.

Now, that's ironic - piggybacking Lite on top of rival Michelob's Ultra, that is - an unintended side-effect of the low-carb trend that launched Ultra into the brand stratosphere, despite the taste. It's even more interesting that Lite made no product adapatation to meet the trend, so it's a cheap repositioning from a product development perspective - in other words, they got lucky by having a beer with only 3.2 carbs to begin with. Here's another excerpt:

In addition, Miller Lite Dec. 5 broke a new branding spot called "Epidemic" from WPP Group's Y&R Advertising, Chicago, that ramps up the "uncompromised taste" position. In the spot, a guy sitting in bar drinking a competitive beer looks at it and says, "I can't taste my beer." Others chime in and run into street shouting "I can't taste my beer." The spot ends with three enjoying their beer, which turns out to be Miller Lite.

- Arik