Molson Coors is betting on a resurgence in cheap beer as inflationary concerns weigh on consumers and demand for craft options decline.
So-called "value beers" like Pabst Blue Ribbon and Molson Coors' Keystone Light were once a mainstay at college parties and other gatherings, though these budget brands were hit hard by the COVID-19 pandemic and the expansion of craft options.
Now, as the craft beer bubble pops and budgetary concerns are top of mind for consumers, big brewers are hoping to reach younger drinkers with a renewed focus on value.
Molson Coors is revamping its value portfolio as part of its 2030 strategy, which is led by Miller High Life and Keystone Ice.
After discontinuing Keystone Ice in 2021, Molson Coors is set to revive the higher-alcohol beer brand in August while expanding flavor options with the introduction of Keystone Apple. The company also revived a light variety of Miller High Life — which is currently available in more than 20 states — with plans to expand further.
“We know there’s a lot of pressure on consumers these days, so delivering a great price point will be imperative,” Chris Steele, senior director of marketing for the value portfolio, said in an interview.
Younger consumers have gravitated toward drinks with fun flavors and higher alcohol content to get the most bang for their buck, with brands like BuzzBallz and BeatBox becoming the new drink of choice.
With alcohol consumption declining and hitting the beer sector especially hard, Molson Coors is betting that value and fresh innovation could bring younger consumers back to the category. To reach young drinkers, the brewer is advertising more on TikTok and revamping packaging on the Miller High Life can.
CEO Rahul Goyal, who stepped into the top role last fall, said in February that these brands can be a strategic lever during a time of consumer price sensitivity. The company is reinvesting in its brands, though Goyal acknowledged it remains a “long-term journey.”
The investment in value beer also comes as Molson Coors works to strengthen its portfolio by expanding its non-beer options. But at the core, both strategies are focused on tapping into more consumer occasions, with value beer meeting them at a dive bar or a summer barbecue, according to Steele.
Molson Coors is working to strengthen both of the value segment’s biggest brands nationwide, but it’s playing into local preferences. The value segment additionally includes smaller regional brands, including Steel Reserve and Hamms. Miller High Life is popular in the East, whereas Keystone has a stronger presence in the West, Steele said.
“Having a great beer at a great price never really goes out of style,” Steele said. “It’s not a trendy thing, it’s just an everyday solid way to run the business.”
While meeting the needs of price-conscious beer drinkers is certainly a priority, Molson Coors’ broader objective is meeting consumer needs for every occasion, and affordable beer plays into that.
“We concentrate a lot more on just making sure that we’re providing a great product for the occasions on which they need it,” Steele said.
