Modelo Especial Surpasses Bud Light as Best-Selling Beer in the United States

Modelo Especial: The Best-Selling Beer in the United States

The Mexican beer brand, Modelo Especial, has dethroned Bud Light on June 3 to become the best-selling beer in the United States, ending Bud Light’s uninterrupted reign since 2001.

A Shift in Sales

Modelo Especial captured 8.4% of sales at grocery stores and liquor stores, while Bud Light fell to 7.3%.

The Decline of Bud Light

Many analysts have been examining the steady decline of Bud Light in an increasingly competitive and diverse market. Established brands are facing difficulties in attracting new generations of consumers while maintaining the loyalty of their existing customer base.

Anheuser-Busch InBev, the manufacturer of Bud Light, recently made a miscalculation by attempting to broaden its consumer base by hiring transgender influencer Dylan Mulvaney for a special Bud Light promotion on social media. This move sparked a backlash from conservative groups, leading to calls for a boycott of Bud Light consumption.

As a result, some stores have been forced to give away Bud Light beer to clear their warehouses, and the manufacturer has resorted to purchasing expired beer left unsold by wholesalers.

The Rise of Modelo Especial

However, the success of Modelo Especial cannot be solely attributed to the decline of Bud Light. Analysts believe that the Mexican brand’s consolidation in the large US market has been a gradual process over the years, driven by the beer’s excellent quality and the loyalty of Hispanic consumers.

“Modelo has been steadily rising for a long period now. While sales during holidays can boost numbers, they continue to perform well even after Cinco de Mayo,” said Dave Williams, vice president of analytics and information at consulting firm Bump Williams.

Scott Scanlon, executive vice president of the spirits division at consumer research firm Circana, noted that Modelo Especial initially targeted Hispanic drinkers when it first entered the US market in the 1990s. However, it has now gained popularity among a broader consumer base that values quality beers.

A Rich History

The story of Modelo Especial dates back to 1925 when a group of Mexican businessmen founded the Modelo Brewery in Tacuba, a neighborhood in Mexico City. The brewery quickly gained popularity and established itself as a producer of high-quality beer.

Interestingly, Americans first tried Modelo beer during the Prohibition era in the United States (1920-1934) when the sale and transportation of alcoholic beverages were prohibited. Americans would travel to Mexico to enjoy Mexican beers.

In the 1970s and 1980s, Modelo Especial’s reputation as a beer of great quality and flavor grew, leading to its expansion throughout Mexico.

In 1994, Grupo Modelo, the parent company of Cervecería Modelo, formed a strategic alliance with the American giant Anheuser-Busch, allowing Modelo Especial to enter international markets.

In 2013, Grupo Modelo reached an agreement with Anheuser-Busch InBev (AB InBev) for $20.1 billion, which required Grupo Modelo to sell its share in the US market to comply with antitrust laws.

As a result, Constellation Brands, one of the leading international beverage companies, acquired Grupo Modelo’s stake in the United States, including the rights to distribute Modelo Especial in the country.

In 2015, Modelo Especial made a strong entry into the Anglo-Saxon market with English-language advertisements, further expanding its consumer base.

In 2018, Modelo Especial became the official sponsor of the Ultimate Fighting Championship (UFC), gaining exposure through mixed martial arts competitions. The brand’s slogan, “made for those who have a fighting spirit,” resonated in American sports bars.

Loyal Consumers and Growing Market

Modelo’s success can also be attributed to its loyal consumer base, particularly Hispanic Americans, who remain devoted to their favorite beer. The US Hispanic population has grown significantly in recent decades, reaching 62.1 million people, or 18.7% of the total population.

Despite changes in international distribution and marketing rights, Grupo Modelo remains headquartered in Mexico City, and all factories producing Modelo Especial are located within Mexican territory.

Sources: Los Angeles Times, NY Post, The Washington Post, The New York Times, Model USA, NBC.

YOU MAY ALSO BE INTERESTED IN | ON VIDEO

Successful Latinas in the US beer market