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BUD's Premiumization & Other Growth Strategies to Bolster Performance
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Anheuser-Busch InBev SA/NV (BUD - Free Report) , alias AB InBev, is poised for growth, driven by sustained consumer demand for its brand portfolio. The company's growth trajectory has been bolstered by accelerated digital transformation, pricing actions, revenue management initiatives and ongoing premiumization efforts.
BUD’s relentless execution, investment in brands and accelerated digital transformation have been bolstering sales growth. The expansion of the Beyond Beer portfolio, and investments in B2B platforms, e-commerce and digital marketing bode well.
Premiumization Strategy
The premiumization of the beer industry has been a key growth opportunity for AB InBev. The company is committed to offering premium beer variants that align with the consumer trend toward premiumization in the alcohol industry. The company has been investing in a diverse portfolio of global, international, craft and specialty premium brands across its markets, with its global brands leading the charge in premiumization.
Revenues in second-quarter 2024 benefited from its diversified global footprint and the continued momentum of its megabrands — Budweiser, Corona, Stella Artois, Corona and Michelob Ultra — which collectively advanced 3.3% year over year outside their home markets. This growth was led by a 5.6% rise in Corona outside its home markets.
BUD’s above-core portfolio has been performing well for a while now. Revenues for its above-core beer portfolio grew slightly in the second quarter of 2024, led by Corona, its global brands in South Africa, and the double-digit increase of Modelo in Mexico and Spaten in Brazil.
Within the premiumization strategy, BUD has been keen on expanding the Beyond Beer portfolio, and investments in B2B platforms, e-commerce and digital marketing. These efforts collectively position it for growth in the long term.
Other stocks in the Beverage-Alcohol industry poised for growth, driven by the premiumization trend, include The Boston Beer Company Inc. (SAM - Free Report) , Brown-Forman (BF.B - Free Report) and Constellation Brands Inc. (STZ - Free Report) .
Beyond Beer Initiative
AB InBev is steadfastly growing its Beyond Beer portfolio, including products like ready-to-drink beverages like Canned Wine and Canned Cocktails, Hard Seltzers, Cider and Flavored Malt Beverages. The Beyond Beer trend has been gaining popularity due to the rise in demand for low-alcoholic or non-alcoholic drinks.
The company remains focused on expanding its Beyond Beer portfolio, which has also been aiding the top line. The Beyond Beer portfolio contributed $375 million to the total revenues in second-quarter 2024. Growth in major brands like Brutal Fruit, Cutwater, Nutrl and Beats was offset by sluggishness in the malt-based seltzer industry in North America.
Digital Transformation
AB InBev has been investing in new capabilities for several years to better connect with customers and consumers. Its digital platform has been rapidly growing, leveraging technology, such as B2B sales and other e-commerce platforms, including BEES and Zé Delivery. It has been witnessing an acceleration in B2B platforms, e-commerce and digital marketing trends, aiding growth in the past few months.
The B2B digital platforms contributed about 70% to BUD’s revenues in the second quarter of 2024. The company noted that the monthly active user base of BEES reached 3.8 million users as of the end of second-quarter 2024. It captured $11.7 billion in gross merchandise value, up 20 % year over year. Its omni-channel, direct-to-consumer ecosystem of digital and physical products generated $140 million in revenues in the reported quarter.
Hurdles to Counter
AB InBev continues to witness elevated costs from commodity cost inflation and investments to support long-term growth. Higher supply-chain costs in some markets, investments in business and operating costs are other headwinds. SG&A expenses rose 2.3% on an organic basis in the second quarter.
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BUD's Premiumization & Other Growth Strategies to Bolster Performance
Anheuser-Busch InBev SA/NV (BUD - Free Report) , alias AB InBev, is poised for growth, driven by sustained consumer demand for its brand portfolio. The company's growth trajectory has been bolstered by accelerated digital transformation, pricing actions, revenue management initiatives and ongoing premiumization efforts.
BUD’s relentless execution, investment in brands and accelerated digital transformation have been bolstering sales growth. The expansion of the Beyond Beer portfolio, and investments in B2B platforms, e-commerce and digital marketing bode well.
Premiumization Strategy
The premiumization of the beer industry has been a key growth opportunity for AB InBev. The company is committed to offering premium beer variants that align with the consumer trend toward premiumization in the alcohol industry. The company has been investing in a diverse portfolio of global, international, craft and specialty premium brands across its markets, with its global brands leading the charge in premiumization.
Revenues in second-quarter 2024 benefited from its diversified global footprint and the continued momentum of its megabrands — Budweiser, Corona, Stella Artois, Corona and Michelob Ultra — which collectively advanced 3.3% year over year outside their home markets. This growth was led by a 5.6% rise in Corona outside its home markets.
BUD’s above-core portfolio has been performing well for a while now. Revenues for its above-core beer portfolio grew slightly in the second quarter of 2024, led by Corona, its global brands in South Africa, and the double-digit increase of Modelo in Mexico and Spaten in Brazil.
Within the premiumization strategy, BUD has been keen on expanding the Beyond Beer portfolio, and investments in B2B platforms, e-commerce and digital marketing. These efforts collectively position it for growth in the long term.
Other stocks in the Beverage-Alcohol industry poised for growth, driven by the premiumization trend, include The Boston Beer Company Inc. (SAM - Free Report) , Brown-Forman (BF.B - Free Report) and Constellation Brands Inc. (STZ - Free Report) .
Beyond Beer Initiative
AB InBev is steadfastly growing its Beyond Beer portfolio, including products like ready-to-drink beverages like Canned Wine and Canned Cocktails, Hard Seltzers, Cider and Flavored Malt Beverages. The Beyond Beer trend has been gaining popularity due to the rise in demand for low-alcoholic or non-alcoholic drinks.
The company remains focused on expanding its Beyond Beer portfolio, which has also been aiding the top line. The Beyond Beer portfolio contributed $375 million to the total revenues in second-quarter 2024. Growth in major brands like Brutal Fruit, Cutwater, Nutrl and Beats was offset by sluggishness in the malt-based seltzer industry in North America.
Digital Transformation
AB InBev has been investing in new capabilities for several years to better connect with customers and consumers. Its digital platform has been rapidly growing, leveraging technology, such as B2B sales and other e-commerce platforms, including BEES and Zé Delivery. It has been witnessing an acceleration in B2B platforms, e-commerce and digital marketing trends, aiding growth in the past few months.
The B2B digital platforms contributed about 70% to BUD’s revenues in the second quarter of 2024. The company noted that the monthly active user base of BEES reached 3.8 million users as of the end of second-quarter 2024. It captured $11.7 billion in gross merchandise value, up 20 % year over year. Its omni-channel, direct-to-consumer ecosystem of digital and physical products generated $140 million in revenues in the reported quarter.
Hurdles to Counter
AB InBev continues to witness elevated costs from commodity cost inflation and investments to support long-term growth. Higher supply-chain costs in some markets, investments in business and operating costs are other headwinds. SG&A expenses rose 2.3% on an organic basis in the second quarter.