Addiction for Profit: the Beer Wars

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There’s a dilemma when it comes to social acceptance of a sometimes bad behavior.

Some, or most, won’t have a problem with alcohol – who we call the “responsible” drinkers. But a percentage of those who drink will abuse alcohol; some become full-on alcoholics.

The dilemma is that by marketing to one segment and increasing sales, you necessarily increase sales to those who can’t handle the product. This is why we restrict advertising to kids.

But marketers, especially beer companies, want to reach that segment of the population, if not when they are too young to buy legally, at least as soon as they turn 21.

A recent article in Ad Age magazine highlights some of the strategies employed. It follows the money spent to see what adult beverage companies are focusing on.

“Why Beer Marketers Don’t Spend Much on Joe Six-Pack” reveals that higher profit margins on premium brands give companies an incentive to push their costlier products and present them as lifestyle choices.

Does that sound a bit odd? Beer companies would like the same defining quality other products enjoy. If they can convince consumers that the beer they imbibe is as important to self-identification as the phone they carry around or the clothes they wear, it’s a win.

What Does that Guy Drink?

Want to be like the most interesting man in the world? How about a James Bond clone? Perhaps you admire the free spirit of a pirate or the intestinal fortitude of a brewer who will recapture a keg of his product from a monstrous bird (and get the girl too)? None of this is by chance. While we can’t actually be the characters depicted, we can buy and drink the beer brand they do – and beer marketers know this. Or, as the Ad Age experts put it:

How has beer been able to get consumers to trade up in a sluggish economy? "It comes down to emotional engagement," Trevor Stirling, a beverages analyst at Sanford C. Bernstein, said. "Consumers are much more likely to "brand' themselves by what they drink, be it a quirky, heavily hopped IPA, or a "sophisticated' Stella; whereas Natty Light and Beast Light have, if anything, negative brand badging."

Joe Six-Pack buys cheap. That’s why you won’t see as many ads for basic beers and blue collar values. The real battle is to get younger drinkers to move up-market into higher priced beers, wine mixes and “exotic” alcoholic beverages.

Why Does It Matter?

According to the Century Council (one of a number of non-profits which track drinking statistics), “nearly 10 million youths, ages 12 to 20, in this country report they have consumed alcohol in the past 30 days. The rate of current alcohol consumption increases with increasing age… from 2% at age 12 to 21% at age 16, and 55% at age 20.”

Advertisers can’t wait until someone hits the magic age of 21 to gain “mind space.” And they don’t. Studies show that ads not only reach our youth, but have a direct effect on drinking behaviors. Just one study that appeared in the journal Addiction in 2005, came to this conclusion:

Researchers followed 3,111 students in South Dakota from seventh to ninth grade, and found that exposure to in-store beer displays in grade 7 predicted onset of drinking by grade 9, and exposure to magazine advertising for alcohol and to beer concessions at sports or music events predicted frequency of drinking in grade 9.

Doubt any of this? Ask some kids. Start at about 16 years-old and work your way down. Ask them to name any beer brands they know. When researchers did something similar they found that one in three 4th graders could name the beer brand when shown the animated character associated with the brand, without seeing the product itself.

Problem Drinkers

The response here may be: “So what? Beer and alcohol are legal products.”

That’s true. But they are also harmful products in the wrong hands. About half of all Americans drink (at least once a month). Of those, about 8 to 10 percent abuse alcohol (18 million). Increase the number of drinkers, and you increase the number of problem drinkers.

The key question is, Why do we want to encourage people to start drinking in the first place? Why is it necessary to get an 11-year-old to remember your beer brand?

Marketers say advertising isn’t about making people drink, but about getting people to drink one product over another; about influencing choice. But influencing choice is tied to awareness and promoting an admirable lifestyle (you’ll never see a beer ad with a guy puking in the gutter). There’s no way to avoid appealing to novice or underage drinkers.

The beer wars will continue. You can watch them play out on television, billboards and other media. Now you’ll spot the trick. You’ll see that what’s being sold isn’t a beer but a lifestyle. And the next time you spot a beer ad, ask yourself who else is seeing it – maybe it’s the kid sitting next to you on the couch.

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