Financial services company HSBC formally downgraded Anheuser-Busch InBev stock to "hold" this week as a result of the ongoing blowback to the Bud Light brand's embrace of transgender activist Dylan Mulvaney that caused sales of the product to plummet — potentially upwards of 25 percent — in April.
First reported by CNBC, HSBC's Carlos Laboy — a managing director in the company's global beverage sector — didn't mince words about what's happened to Anheuser-Busch InBev (ABI) amid its "Bud Light crisis" as a result of its evidently shortsighted plunge into a culture war battle that alienated and angered customers, causing "deeper problems than ABI admits."
HSBC downgrades Anheuser-Busch InBev as it deals with a 'Bud Light crisis' https://t.co/4xd5R1YZpI— CNBC (@CNBC) May 10, 2023
Saying that ABI's attempts to get the "brand culture transformation right" are "mixed," Laboy explained that the "way this Bud Light crisis came about a month ago, management's response to it and the loss of unprecedented volume and brand relevance raises many questions."
Among those questions is a basic one: What were Bud Light and ABI thinking?
Laboy put it succinctly in his note following HSBC's decision to downgrade Anheuser-Busch stock: "Why did its U.S. leadership underestimate the risk of pushback given the recent experience of other firms? Is A-B hiring the best people to grow the brands and gauge risk?” he asked, although the answer seems to be a resounding "no." As Townhall reported, multiple executives were placed on leave as a result of the Mulvaney stunt.
"If Budweiser and Bud Light are iconic American ideas that have long brought consumers together, why did these marketers fail to invite new consumers without alienating the core base of the firm’s largest brand?" Laboy also asked.
That's a question for Bud Light's senior marketing executive (now on leave) Alissa Heinerscheid who called Bud Light "out of touch" and "fratty" on a podcast before teaming up with Mulvaney in a bizarre attempt to remake Bud Light's image that succeeded only in driving away much of its existing customer base.
There's Been a New Development in the Bud Light Saga— Townhall.com (@townhallcom) April 22, 2023
In the aftermath of its botched attempt at rebranding, Bud Light has tried pretty much anything — including giving away free beer — to win its customers back. So far, it doesn't seem to be working too well.
To be clear, this whole mess was because Bud Light decided it would be a good idea to celebrate Mulvaney — a biological male who identifies as a woman — and mark 365 days of him "being a girl" with a special can of its suds. Bud light initially stood by its decision as the internet began to turn on the company, then scrambled to distance itself claiming there was "no formal campaign" featuring Mulvaney.
Whether that's technically true or just more desperate damage control, Bud Light's customers saw all they needed to in order to decide the product was no longer for them. With HSBC's formal downgrade of its parent company's stock, it seems we're still discovering just how much damage Bud Light did to itself.