Are beer brands stretching line extensions to breaking point?
Category commentator Stephen Beaumont is exhausted. All that counting has worn him out and, dear beer brand owner, it's all your fault.
Earlier this year, Heineken settled its long-running dispute with Tequila’s regulatory body over the use of the word ‘Tequila’ in connection with its Desperados brand. The move preserves what was just a single flavoured beer when the court challenge commenced - Today, the Desperados portfolio includes the original plus seven line extensions, including a non-alcoholic version.
At least the brand hasn’t got a hard seltzer in its family
Leaving aside for a minute the curiosity of a beer purported to be flavoured with Tequila having an alcohol-free version - non-alcoholic beer and spirit? - the undisclosed settlement had me wondering if more versions of the brand might soon start showing up, and whether or not that’s a good thing.
Of course, the Heineken-owned Desperados is hardly the only beer brand to offer multiple line extensions; in fact, they’re pretty low on the chart when it comes to actual numbers of SKUs. And, it needs be quickly added, at least the brand hasn’t got a hard seltzer in its family, although that could simply be because it's far stronger in Europe, where alcoholic sparkling water is still struggling to become established, than in seltzer-crazy North America.
On that note, it's pertinent here to recall the recent words of Molson Coors Beverage Co's US sales & distribution president, Kevin Doyle, who attributed the decline of beer-branded hard seltzers in the US to their association with the parent brand, contrasting them with the success of pure-play hard seltzers like White Claw, Truly, and his company’s own Vizzy.
While this view might not be quite the same as saying that beer brand line extensions are getting a bit out of control, it’s straying pretty close to that notion.
The family of brands expanded at a prodigious rate, adding extensions and losing extensions
In North America back in the day - ‘the day’ being only a few decades ago - brewers branded their beers with the name of the company and the name of the beer, so you had Miller Lite and Coors Banquet and, although rarely stated as such, Anheuser-Busch Budweiser. In Europe, where the understanding of beer styles was much more commonplace, it was often the brewer's name and style, so Hacker-Pschorr Hefeweizen or Heineken Lager.
While I can’t be certain of this, the moment that this state of affairs began to change seems to have been when A-B launched Bud Light, thus creating the Budweiser ‘family of brands’. Over the subsequent years, that family expanded at a prodigious rate, adding extensions, losing extensions and, ultimately, spinning off one of its members, Bud Light, into a family all of its own.
The original raison d‘etre of the brand has been all but lost
Where Budweiser was once self-crowned the ‘King of Beers’, there is little doubt that its offspring has become the ‘King of Line Extensions’. A quick scroll through the budlight.com website reveals just how large and diverse that family has become, with Bud Lights that are flavoured, Bud Lights that are strong, and of course, a whole host of Bud Lights that are seltzer.
So large has the Bud Light family grown, in fact, that the original raison d‘etre of the brand, a low-calorie, lower-alcohol beer, has been all but lost. I mean, what exactly is ‘light’ about Bud Light Platinum Seltzer, which packs an 8% abv and 170 calories into a 12oz can?
Which brings us to the blessing - and the curse - of line extensions. On the positive side, having as universally-recognised a name as Bud Light means you can attach it to almost anything and create instant brand awareness, as A-B InBev has done with its extensive array of Bud Light Seltzers.
On the other hand, however, such widespread use dilutes the original meaning of the brand name, to the point that ‘light’ can mean ‘strong’ and ‘flavoured with Tequila’ can mean ‘non-alcoholic’. In the short term, such dilution is probably not going to have any sort of major impact, but over the course of time, it can result in consumer confusion, which might include some wondering why they were buying the original of the brand in the first place.
None of which is to say that line extensions are by definition bad ideas – marketers and industry executives obviously believe them to be quite effective, or else we wouldn't be seeing so many. But, one has to believe there's a limit; a maximum number of spin-offs that can be spun before the brand loses all meaning. At the very least, it makes sense to confine the brand to the space it was originally intended to occupy.
After all, you don’t see Coca-Cola branding ginger ales with the Coke label, Google launching a line of kitchen appliances, or Nike branching out into formal wear.
There’s probably a good reason for that.