LGBTQ beer ads are old hat — despite new troubles for Bud Light

After more than 20 years at the top of the beer charts, Bud Light retail sales in the United States have taken a dive at the same time the brand is facing criticism over featuring a social media star who is transgender in an advertisement.

"This is sort of uncharted waters for a brand like that when it comes to seven weeks of sharp declines of that magnitude,' said Dave Williams, vice-president of analytics for Bump Williams Consulting, which focuses on the alcoholic beverage industry.

The brand has faced negative reaction in the United States since an early April video where transgender TikTok star Dylan Mulvaney promoted the brand and held up personalized commemorative cans featuring her face. Some politicians and celebrities in the United States reacted angrily to beer brand featuring a transgender spokesperson.

While it's impossible to directly connect Bud Light's drop in sales to a single Instagram video highlighting a trans spokesperson, Williams said that since April, sales have been declining for Bud Light while other brands have gained traction. The data are not publicly available.

Williams's firm analyzed data from Nielsen IQ and found dollar sales of Bud Light at U.S. retail outlets had dropped by more than 24 per cent in the week ending June 3, compared to the year before. Mexican lager Modelo Especial took over the top spot from Bud Light.

"I certainly see a correlation between, you know, some of the backlash that we saw online … with the recent accelerated declines in sales," said Williams.

Williams and other industry watchers are characterizing the fall in sales as likely tied to a conservative backlash — and ensuing fallout — over the inclusion of LGBTQ groups in an advertisement, even though beer companies have leveraged gay, lesbian, bisexual and gender-diverse communities in marketing for years.

Bud Light wasn't 'prepared' for backlash: marketer

The backlash — and the resulting drop in sales — may have caught Bud Light and its parent company AB InBev off guard, according to a Toronto-based marketer.

"Bud Light has always supported and actually comes after queer consumers," explained Scott Knox, founder of industry group Pride in Advertising and Marketing, who said that after the backlash to a trans spokesperson erupted online, Bud Light's response was "lukewarm" and didn't appear decisive, for either heterosexual or LGBTQ audiences.

"What that signaled was they weren't prepared and they weren't ready to deal with any potential backlash because it was a trans performer, " said Knox.

The company's response has not directly addressed or apologized for the video. But one of the executives responsible has taken a leave of absence, and the company issued a press release where it said "we never intended to be part of a discussion that divides people."

LGBTQ advocates at the U.S. based Human Rights Campaign called the company's responses "shameful."

To marketers such as Knox, Bud Light should have taken a more firm stance after the backlash started.

While a portion of its customer base was demonstrating anger in online videos, some of which featured celebrities shooting Bud Light with firearms, another portion of the customer base may have been upset at Bud Light taking a muted stance.

"When you do speak to any diverse community, you have to be ready to do it, and if there's a backlash, you double down. Otherwise you end up annoying both sides … those who are part of that [diverse] community and those are part of the wider general and in this case, heterosexual community," he told CBC News.

Beer companies 'pouring rainbows' for years

Alcohol manufacturers have been marketing beer to LGBTQ communities directly for years, with event sponsorships at Pride festivals across North America, and ads featuring gay, lesbian, bisexual and gender-nonconforming people.

For Syrus Marcus Ware, who teaches courses on gender and visual culture, this is a natural reflection of LGBTQ people being part of both the community and economy.

"Having a beer company directly market to queer and trans people says, hey, hold on, we actually recognize that you exist, that you're part of our community, we want some of your dollars, but also, you know, you exist," said Ware, who is an associate professor at McMaster University.

According to Ware, ads that do not feature gender- or sexually diverse communities are exclusive, rather than being a marketing catch-all.

"The problem with the idea of neutrality is that we're essentially saying that straight is neutral, that non-queer and non-trans people are neutral," said Ware.

"I think we need to shift that and change that. Queer and trans people, straight people, we all are part of this community and this ecosystem."

Some companies may be a bit reticent to put themselves forward in support of queer and trans communities going forward. That's concerning for me.

– Syrus Marcus Ware, McMaster University

Knox is on a similar page. Marketing to gender and sexually diverse communities isn't new, and from a financial perspective can — and does — pay off.

"Look, all beer is queer, and it has been for over 10 years. Brands have been pouring rainbows out from pumps, cans in supermarkets, and bars across the world because the dollars from the queer community are there and on the table," said Knox.

What's next for Bud Light?

Bud Light's parent company also owns Labatt Breweries of Canada, which responded to inquiries from CBC News about future plans with an emailed statement saying it remains committed to partnerships "forged over decades" across many commnunities, including LGBTQ groups.

"We continue to sponsor local Pride events as we have for years," wrote the company.

While sales have been dropping in the past weeks, industry analysts like Dave Williams point out that Bud Light has been at the top of the game for years and may be able to recover if the controversy passes given the brand's size and reach.

Bud Light also remains on top for the year to date, with more than half of 2023 to go.

"They're the king for a reason, right? They've got the volume behind them," said Williams, who added that the current culture war over trans inclusion in a beer ad is harmful to the industry.

"I don't think it's great for beer as a whole. Because beer in my mind is supposed to be a social beverage," he said.

Ware is worried the Bud Light controversy will cast a chill over inclusive representation in the future.

"Some companies may be a bit reticent to put themselves forward in support of queer and trans communities going forward. That's concerning for me," he said.

However, Knox said the industry's branding may not move away from rainbows entirely.

For example, a Molson Canadian ad that ran for part of the Stanley Cup playoffs featured a drag queen, though the ad only ran in Canada and not the United States. In a statement Molson said, "beer, wine and spirits companies like ours have supported Pride for decades" and will continue to do so "for decades to come."

As for Bud Light, Knox speculated the company will try to find a way to keep all consumers happy when it comes to Pride marketing.

"What that means is they will do the basics … which is glitter and rainbows and maybe an occasional drag queen."