What's Changed? Does Beer Advertising Affect Consumption in the United States?

Gary B. Wilcox
The University of Texas at Austin

Harsha Gangadharbatla
The University of Texas at Austin

INTRODUCTION

What has changed in the US beer market? Since 1970, there have been both significant marketplace and brand transformations. From the introduction in the mid-1970s of the light beer category to the recent increases in the imported beer category, the past three decades have seen light beer sales grow from a segmentation concept to 45% of the market, and imported beer market share increase from less than 1% in 1970 to over 13% in 2004.

Significant structural change has also taken place. In 1970, the year that Phillip Morris acquired Miller Brewing Company, Anheuser-Busch, Miller and Schlitz accounted for approximately 50% of the market. Today, Anheuser-Busch, Coors and Miller represent 80% of total production, with Anheuser-Busch alone now accounting for 50% of the market. From the mid-1970s to the mid-1980s, advertising expenditures increased over 400% to $762 million. By 2003, yearly measured media expenditures stood at over $1 billion.