Wednesday, July 9, 2008

The selling of 'the great American lager'

Pitcher This: The selling of 'the great American lager'


There's been lots of talk recently about the biggest beer deal in years: The offer by Belgium-based international brewing giant InBev to pay $46 billion for America's iconic beer-maker, Anheuser-Busch. Depending on who's talking, the offer is either a common-sense investment by one giant corporation in another, a low-ball effort by one company to pick up another on the cheap, or an affront to national dignity — a foreign corporation buying up an American household name.

It's talk of the last kind that seems to be the loudest, and the most based on emotion in place of fact.

It seems a lot of people care deeply about the legacy of the venerable St. Louis-based brewer, founded in the mid-1800s by German immigrants.

Sure enough, AB, as the company is known, produced or perfected many of the innovations that have made the modern brewing industry possible. When Eberhard Anheuser bought what became Anheuser-Busch in 1860, beer was a very much a regional, even local beverage. Brewers couldn't ship their product far because beer wouldn't keep for long trips. Anheuser's son-in-law, Adolphus Busch, helped introduce pasteurization and refrigerated railcars, both of which made it possible to ship the brewery's beer to new markets, according to an official company history.

When the company introduced its Budweiser brand in 1876, it used these new tools to make Bud the first nationally distributed beer, shipped far beyond St. Louis.

To help introduce the brand to these new markets, the company also innovated in marketing and advertising, putting the Budweiser name on posters of attractive young women — "Budweiser Girls" — holding bottles of the brew.

All of this helped AB to become the country's largest brewer, with Budweiser the best-selling brand nationwide by 1957, according to the company. It also helped to nearly end regional and local brewing, as mass-marketed national brands out-competed smaller producers.

Of course, Anheuser-Busch wasn't the only big fish in this pond. Miller and Coors enjoyed successes of their own, competing hard to become household beer names in their own right. Of course, not nearly as much hullabaloo was raised when in 2002 Miller was sold to South African Breweries, forming SABMiller, or in 2005 when Coors merged with the Canadian brewer Molson. Those companies now are cooperating in the United States as MillerCoors, to act as a stronger competitor to the giant Anheuser-Busch.

And the headlines weren't nearly as big in 2006 when AB bought the Rolling Rock brand from none other than InBev, shuttering the storied Latrobe, Pa., brewery where it had been made for generations to move production to its own plant in New Jersey. In short, AB is not a new player to this mega-brewer game. The company helped make the rules, and it should come as no surprise that they might wind up inside a bigger fish someday.

The good news is that even if the sale goes through, regional and local brewing in America is in the midst of a big comeback. The big brewers have been losing market share in recent years to smaller, upstart companies who've built their business on brewing something wholly different from Bud.

So rest easy, American beer will be alive and well, even if the company with the big bald eagle in its logo gets sold off to Belgium.