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Advertising Age has a piece about how the beer industry's biggest companies, Anheuser-Busch InBev and MillerCoors, "are being battered by a new wave of competition from inside and outside the beer market and starting to lose their grip.

"On one side, newly aggressive liquor brands are stealing share, especially among the coveted young-adult demographic. As a result, beer has seen its piece of the total alcohol market fall to 48.8% last year from 56% of sales in 1999, according to the Distilled Spirits Council of the U.S. On another, craft brews, once a trendy badge for beer geeks, are now mainstream options for Joe Sixpack, a development that has contributed to eight of the top 10 U.S. beer brands losing share at stores in the 52 weeks ending Aug. 11, according to IRI."

The story goes on: "The situation is grim, but not irreversible. The two big brewers still control 74% of beer-shipment volume in the U.S. by Beer Marketer's Insights' calculations. And with their massive scale and marketing machines, the companies have experienced early success with new brands meant to take on liquor and smaller craft beers. But before the beer industry can regain its buzz, it's important to understand the six-pack of hurdles it has in front of it."

Among the most important of these challenges:

• Taste. The story suggests that while mainstream beer companies have focused on going lighter and broad-based, craft brewers have gained share by being more focused on specific tastes, offering a range of darker and more complex brews.

• Advertising. Beer companies have been known for great ads, but that has been less the case in recent years, when they have largely come up with ads that are "lackluster."

• Women. Beer companies generally have not targeted women, and have portrayed them in less than complimentary ways in advertising. To grow their brands, mainstream beer companies have to find a way to appeal to women.
KC's View:

I thought that it was ironic that almost at the same time as this piece appeared in AdAge, the Boston Globe was reporting on how the craft beer segment grew 15 percent during the fast half of 2013, while total US beer sales were down two percent ... and largely because of his success in the craft beer business, Jim Koch - founder of Boston Beer Co., manufacturer of Sam Adams - has become a billionaire. (Not that he seems to care about the money very much.)

Also ironic that Bloomberg Businessweek has a story about how Walmart is so intent on becoming the nation's biggest beer retailer that "it has been selling Budweiser, Coors and other brews almost at cost in at least some stores ... part of a plan to double alcohol sales by 2016 and seize a larger slice of a U.S. beer market worth about $45 billion."

(Is it a symbol of a larger strategic problem at Walmart that it is spending a lot of money seeking to dominate a segment in decline?)

To me, it comes down to highest common denominator marketing vs. lowest common denominator marketing. The companies doing the former seem to be growing, while the mainstream beer companies, which sort of reflexively do the latter because that's what big companies do, are suffering.

And just one more time ... it is worth looking at the recent ad for Guinness, which is highest common denominator marketing at its best. Check it out at right.