Dive Brief:
- Molson Coors brands Coors Light, Miller Lite and Coors Banquet saw double-digital volume growth in the second quarter, according to an earnings statement.
- The company’s growth volumes were up 8.7% in the U.S. over the period. Molson Coors attributed the gains to changes in consumer purchasing behavior, mostly in the premium category, a sign that the marketer has continued to benefit from controversies impacting rival Anheuser-Busch InBev.
- Q2 produced the strongest net sales revenue since Molson and Coors merged in 2005, up 12.1% year-over-year. While executives nodded to InBev’s struggles, they attributed strengths in the business to a long-term transformation plan, including stronger consumer marketing like Coors Light’s “Made to Chill” brand platform that launched in 2019.
Dive Insight:
Molson Coors grew its core brands in Q2 as chief rival AB InBev continued to deal with the fallout from a Bud Light controversy stemming from a partnership with transgender influencer Dylan Mulvaney. Molson Coors’ underlying marketing, general and administrative expenses were up 4.1% YoY over the period as the firm increased media activity.
Executives nodded to the slide in Bud Light’s sales but argued that the long-term work they’ve put into revitalizing Molson Coors’ business, from both an operational and marketing standpoint, is what allowed them to properly seize the moment.
“If this had happened in 2019, we would surely not have seen the sales benefit that we did in 2023 or even been able to meet the demand,” said Molson Coors CEO Gavin Hattersley on a call with analysts.
Despite some gains, the overall earnings picture was mixed, with revenue coming in under analyst expectations. Hattersley took some time to boast, noting that Coors Light and Miller Lite combined now represent a share of industry dollars that is 50% larger than Bud Light and 30% larger than Modelo Especial. Modelo in Q2 became the top-selling beer in the U.S., unseating a position Bud Light held for over two decades.
Molson Coors plans to ramp up its marketing spending to preserve momentum. In the U.S., the company has historically under-indexed in the convenience store space. It will increase its shopper marketing dollars around c-stores for the second half, according to Hattersley. Molson Coors expects higher expenses in H2, primarily driven by marketing spend, which it plans to hike by roughly $100 million.
Molson Coors also raised its 2023 financial guidance and said it now expects a high single-digit increase in net sales for the full year.
