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As heated as it is, the escalating battle between Miller and A-B in the U.S. is only one part of a much wider heavyweight fight for beer drinkers around the globe. For decades the beer business has been relatively fragmented, dominated by local tastes and brewers. In recent years, multinational players like Anheuser-Busch, SABMiller, Heineken and Interbrew have embarked on a wave of consolidation, buying up smaller brands in Eastern Europe, Latin America and Asia. In May, SABMiller and A-B briefly engaged in a bidding war for Harbin, the fourth largest brewery in China, which is now the fastest growing and biggest beer market in the world. Though SAB lost out to Anheuser's higher offer, Miller's parent still holds a 49% stake in China Resources Breweries, the country's second largest brewery.
If future growth lies in China, the U.S. market remains easily the most profitable. Even in the down-and-dirty beer business, the recent skirmishes between Miller and Bud have been notable for their aggressiveness. With more and more Atkins-conscious beer drinkers watching their waistlines and Anheuser's Michelob Ultra low-carb beer taking off, Miller launched ads in late 2003 pointing out that Miller Lite had half the carbs of Bud Light. Then, in April, Adami upped the ante with the humorous President of Beers campaign. Once it became clear that Miller's well-crafted messages were having an impact, Budweiser responded with a negative counterattack, challenging both Miller's heritage, by making an issue of its foreign ownership, and its manliness, by dismissing Miller Lite as the "queen of carbs." "That's a very macho accusation against a brand that has been giving them a royal shellacking," said Adami, a hard-swearing chain smoker, in a recent speech.
Only lately, however, has Adami started to find such charges funny. In May, Miller took the battle with Budweiser from the store shelves to a courtroom, seeking an injunction to stop Anheuser and its distributors from what it claimed were false and deceptive marketing practices, including the defacing of Miller products in stores with pro-Budweiser stickers. A federal court ordered Anheuser to pull liquor-store posters that said Miller is owned by South African Breweries--its parent, SABMiller, is now headquartered in London. But the judge allowed the continued airing of TV ads declaring that Miller is South African owned--and therefore ineligible, Budweiser's talking lizards informed viewers, to run for "president of beers." The legal offensive has since been dropped, but the bad blood persists. "They'll lead you to believe the ads are all part of their plan, but really it's desperate," says Michael Owens, A-B's new vice president of sales and marketing. "They've got all their juice on one brand--we're giving it back, in kind."