Bud Light, once the #1 beer in America, saw a plunge in ratings after its controversial partnership with transgender influencer Dylan Mulvaney in March. The ensuing boycott from outraged customers led to declining sales, cratering stocks, and a marketing challenge the company still hasn’t overcome. Bars and grocery stores can’t even seem to give Bud Light away, leading many locations to drop it entirely. Yesterday, yet another nail was added to the coffin of the Anheuser-Busch subsidiary—this time by Costco.
The Costco business model is relatively simple: in exchange for a monthly membership fee, customers get access to bulk items at the lowest possible prices. The warehouse club’s no-frills approach means selections are often limited, but the items that are available will offer savings like nowhere else. However, this is only possible when those items are selling well. When customers start dropping a particular item, Costco has been known to drop it just as fast.
And lately, nothing has been dropping faster than Bud Light.
Subscribe to PBD’s YouTube channel today for every episode LIVE or On Demand!
Eagle-eyed Costco shoppers spotted a small asterisk in the corner of the price tags in multiple locations, and this tiny symbol doesn’t bode well for the struggling beer brand. Known in the Costco community as “the star of death,” an asterisked price tag tells store employees that the indicated item will not be restocked once it sells out.
Costco just got even better. https://t.co/DQjkzSpBrS
— Lauren Chen (@TheLaurenChen) July 13, 2023
But unlike other locations that are dropping Bud Light, Costco’s “death star” doesn’t seem to be a comment on the beverage maker’s politics. With the declining interest in Bud Light by the general public, Costco is left with no choice but to drop the beer entirely or else risk passing higher prices onto consumers. This appears to be strictly business on Costco’s end…though for Bud Light, it’s anything but.
“There’s a big social conversation going on right now,” said chief executive Brendan Whitworth. “It’s moved away from beer…Bud Light doesn’t belong in this divisive conversation.” But with nearly $27 billion in lost market cap, merely trying to pull out of the conversation won’t be enough to save them. According to former Anheuser-Busch executive Anson Frericks, the statement should’ve been: “Of course this was a mistake, we wouldn’t do this again because we’ve lost billions of dollars in market cap, our brands are down almost 30% and all of sudden we’re putting a lot of our suppliers at risk.”
But in the face of boycotts, stock devaluation, negative public sentiment, and a dreaded Costco Death Star, even that statement might be too little too late.
Add comment