By Will Novosedlik

This story originally appeared in the Winter 2021 issue of strategy. 

Over the years, North Americans have shunned carb-heavy suds in favour of more interesting alternatives in the wine, spirits and ready-to-drink categories. In fact, in 2019, according to Beer Canada, domestic beer sales declined by 3.9% year-over-year, with per capita consumption down 4.6%.

Despite the beer industry’s steady decline (and not to mention an economic-crushing pandemic), Labatt appears to have had a banner year, in large part thanks to Todd Allen, who recently became the global VP of marketing for Budweiser.

In 2020, Allen – who spent the last four years leading Labatt’s brands in Canada – helped grow market share by 1.2%, earned media by 125% and brand power by 4%. How did he and the marketing team do it? By putting the consumer at the heart of everything they do; building brands with purpose; innovating both in terms of products and experience; and being culturally relevant.

“We don’t see ourselves as a beer company but as a total alcohol beverage company,” says Allen. “We’ve been playing in the ‘beyond beer’ category for quite some time with Palm Bay and Mike’s Hard Lemonade [which have a lower calorie, sugar and carb count], but in recent years it’s really taken off due to two unstoppable trends, one being health and wellness, and the other being convenience.”

This past summer, Labatt went to market with new products including the Bud Light Strawberry Lemonade and Mike’s Hard Blue Freeze (rated the #1 beer innovation of the year and the #1 RTD innovation, respectively, by Beer Canada). There was also the rollout of Babe, now the #1 selling canned wine at the LCBO.

To figure out what people want, Labatt relies on brand guidance tracking through Kantar every month to ethnographic deep dives and qualitative sessions with consumers. On top of that, Allen’s team works with AI tech partners such as Twitter, Sparks & Honey, and Crimson Hexagon (now Brandwatch) to scrape the digital ecosystem and understand consumer trends, turning the data into insights and recommendations for the business going forward.

Then there’s purpose. Labatt has been focusing on social issues, as well as sustainability through energy reduction, water access and plastic waste removal – via brands like Budweiser (which uses 100% renewable electricity to brew all of its beer); Corona (which removes plastic waste from rivers, lakes, waterways and oceans); Stella Artois (with its longstanding relationship with Water.org); and Bud Light (which recently shone a light on gender diversity in the music industry.)

As for innovation, Allen set up two tiers: the first is for experimental products or services that are more complex and speculative, and which he hired a dedicated team to nurture and grow. “We call this our ‘venture ops’,” explains Allen. “It’s designed to help us get real-time consumer feedback through minimum viable products and services in a controlled, structured pilot environment.” The second level takes a more incremental approach to innovation that is focused on improvements to existing product rather than the creation of entirely new ones.

The fourth pillar is cultural relevance. To achieve that, Allen relies on weekly think tanks with everyone across the marketing spectrum. “We need our teams sitting together, from social listeners and community managers to our data and analytics team to our creative and production teams and our brand marketers,” says Allen. “We run an internal weekly newsroom where we get together to analyze what’s being talked about around Canada and what’s trending so we can organize ourselves around both planned and unplanned cultural moments.” As a result, earned media on digital content is up 200% and organic share of conversations is up 100%.

Allen also has DraftlineYYZ, the company’s in-house agency that creates content for social and digital platforms across the full brand portfolio. It does that by being 100% digital- and mobile-first, and through direct relationships with Facebook, Twitter, Google, Spotify, Pinterest and Instagram. “We work with them to understand fit for format, creativity and audience segmentation,” says Allen. “As a result, we’ve made drastic changes to our media mix. It’s now 70% digital to 30% traditional, allowing us to use personalization and keep the content as relevant as possible.”

Labatt’s ability to connect with consumers was on full display in 2020. For example, when Budweiser ran an ad during the SuperBowl, in partnership with Uber, it reprised its iconic “Whazzup?” ad from 2007 – where a group of friends exchange the ‘whazzzzzaaaaap?’ greeting (which itself became a part of culture at the time) over their phones while watching the game and drinking a Bud. For the updated 2020 version, the conversation happens between various smart devices, like a Roomba and an Alexa, technologies that didn’t exist back in 2007.

One of the marks of a solid strategic foundation is how well it stands up in an economic crisis. By working closely with agency partners Anomaly, Me&Ideas, FCB, Salt XC, Vizeum and Veritas, Allen responded to the pandemic with initiatives that were clearly built around consumer needs and recognized the difficulties of the past year.

When COVID-19 hit in mid-March, just like everyone else, Allen and his team had to throw out the playbook and start over. With homes becoming the new hub for consumers’ social activity, the company focused on providing entertainment to help them get through the lockdown. The Budweiser Stage at Home – in partnership with CityTV and LiveNation – featured the artists who were originally scheduled to perform at the outdoor Budweiser Stage in a series of live concerts on TV and online. As one of the first socially distanced concerts to come out of the quarantine, the Bubweiser Stage at Home was a #1 trending topic on Twitter every Saturday night.

Then there was Open Mike’s Comedy, which used YouTube to bring to the stage some of the world’s best stand-up comics. At the time of the series launch in July, Allen told strategy that alcohol consumption occasions had shifted when people were mandated to stay at home. “Ultimately, to become relevant with your brand in these challenging times, you’ve got to adapt to where the consumer occasions – and their media-viewing habits – are,” said Allen. The series was a success, driving over four million views with an average watch time of 3.6 minutes.

Having its ear to the ground also led Labatt to be among the first companies to respond to the health, economic and social impacts of the pandemic. In the first wave, Labatt produced 100,000 hand sanitizers in support of Food Banks Canada, frontline workers and partners in the restaurant and bar industry. The program was a part of Labatt’s new CSR program called “Ideas for Good,” which also led to the launch of Budweiser One Team and a $500,000 donation to the Canadian Red Cross this year.

Stella Artois threw its support behind the restaurant industry in a platform called “Rally for Restaurants,” which encouraged Canadians to purchase gift cards from more than 1,000 restaurants and bars. So far, the brand has helped inject more than $800,000 back into the foodservice industry, with consumers purchasing more than 15,000 gift cards from the site.

And when Labatt wanted to restore public trust for the restaurant industry, it created the “POST (People Outside Safely Together) Promise” with the Retail Council of Canada, the Canadian Federation of Independent Business and Restaurants Canada. The promise is a declaration that businesses can make through signage, demonstrating five steps they’re taking to keep customers safe: social distancing, sanitization, self-isolation, disinfection and respiratory etiquette, such as covering one’s mouth when coughing.

According to the most recent Spencer Stuart Annual CMO survey, the average tenure of a marketing executive is 41 months. Allen, who’s been with Labatt for almost eight years, is easily defying those odds. He and his team have created a solid foundation for the kind of purposeful innovation, customer focus and cultural relevance needed to play the long game. “We’re drawing on Labatt’s 170-year history as a brand and we are trying to build a company that will last another 170 years.”