NEW YORK: US brewing giants SABMiller and Molson Coors are to merge their domestic operations to compete more effectively with number one rival Anheuser-Busch.
MillerCoors, as the venture will be named, hopes its combined marketing strength will attract better media and sports sponsorship deals. It will also be able to cut costs in areas such as consumer research.
Brands such as Miller, Pilsner Urquell, Coors Lite and Molson Dry will benefit from marketing dollar increases, pledges Tom Long, currently Miller ceo, but who will take on the role of president and commercial director of the joint enterprise.
He says: ""We want to put more dollars to driving consumer choice and offering them what they want. If that means raising our advertising and spending against our brands to get that done, we have to get that done."
AB, with its Budweiser brand, controls nearly half the US beer market, a position it has maintained through aggressive marketing. Last year it spent £511.6 million (€361.9m; £250m) on advertising in the US, according to TNS Media Intelligence.
Miller currently has around 19% of the US market and spent $240.9m last year on ads; while Molson Coors claims the number three market share of around 11% and an adspend of $187.4m during 2006.
It is unclear whether the merger will result in consolidation of marketing agencies.
Data sourced from Wall Street Journal Online; additional content by WARC staff