Budweiser New Us Chief Faces A Slumping Market For Classic Beer Brands

Posted: Nov 14, 2017



AB InBev announced Monday that Michel Doukeris would replace current North America Zone President and Anheuser-Bush CEO, Joao Castro Neves.

Doukeris, a 21-year-veteran who currently serves as chief sales officer, grew Budweiser in China and spearheaded AB InBev's efforts to make the company's portfolio more premium.

Sales in the U.S. have slumped, as consumers drink more craft and imported beer and wine and spirits. Staples like Budweiser and Bud Light have struggled, while Mexican beers like Corona have thrived.

Michel Doukeris is taking over as CEO of Anheuser-Busch, AB InBev's North American unit, and he's tasked with growing U.S. sales, a problem that has vexed the global brewer.

AB InBev announced Monday that Doukeris would replace current North America Zone President and Anheuser-Bush CEO, Joao Castro Neves. The company said 22-year-veteran Neves would leave to pursue other interests.

Sales in the U.S. have slumped, as consumers drink more craft and imported beer as well as wine and spirits. Staples like Budweiser and Bud Light have struggled, while Mexican beers like Corona have thrived.

Doukeris, a 21-year-veteran who currently serves as chief sales officer, grew Budweiser in China and spearheaded AB InBev's efforts to make the company's portfolio more premium. Unlike Neves and previous CEO Luiz Edmond, his background is in sales, not finance, and that's a key shift for a company that has relied on cost-cutting and mergers and acquisitions, said Jefferies analyst Ed Mundy.

"They're masters at integration and cost cutting, but they're at the end of the road with (mergers and acquisitions)," Mundy said. "There are few other roads they could go down, so this business needs to focus much more on organic growth and that hasn't been a core of the ABI skillset."

Growing Bud Light and Budweiser will be two of Doukeris' most obvious challenges. Bud Light's sales have slid 5.8 percent this year, and Budweiser's have skid 6.7 percent, according to Nielsen data compiled by Beer Marketer's Insights. That's down from losses of 3 percent and 2.5 percent last year.

But that probably won't be Doukeris' only focus. Mundy pointed to Michelob Ultra, which has become an important piece of the company's portfolio. Sales have risen 21.9 percent this year and 22.8 percent last year, according to Nielsen data compiled by Beer Marketer's Insights.

Michelob Ultra is nearing 10 percent of Anheuser-Busch's total volume in the U.S., though Bud Light and Bud combined still represent about 50 percent, according to Beer Marketer's Insights. Because of that breakdown, Doukeris will likely focus on both stemming declines in Bud and Bud Light while also growing Michelob Ultra, Mundy said.

At the very last, he said, the shakeup shows AB InBev's commitment to topline growth in the U.S. The company made a point of stating that in its press release announcing the change.

AB InBev CEO Carlos Brito said, in a statement, "The US is our most important market and we recognize the need to continue to focus on driving topline growth across our portfolio...(Doukeris) is the ideal person to lead North America at this time, together with an emerging group of leaders being elevated in the company."

Anheuser-Busch also announced a slate of personnel changes, including Northeast Region leader and former PepsiCo veteran Brendan Whitworth being named vice president of sales. He will replace Alex Medicis. All changes are slated to be effective Jan. 1.

Shares of AB InBev fell 0.4 percent on Monday. They've gained 11.7 percent this year.


By Angelica LaVito
November 13, 2017
Source: CNBC.com 

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