Wednesday, April 16, 2014

Constellation Brands: The Wine, Spirits, and now Beer Giant

You may not know it by name but Constellation Brands, Inc. is a successful wine, beer, and spirits company that has grown quite largely in the recent years.  The company reported a whopping $4.9 billion in revenue for 2014, up 74% from the year before! Why such a strong spurt in growth? Well, specialists say it has much to do with Constellation's acquisition of Grupo Modelo, the maker of Corona and various other Mexican beers.

With brands such as Robert Mondavi, Clos Du Bois, Estancia, Arbor Mist, and Naked Grape, Constellation is definitely a high performer in the wine industry.   What also sets this company apart from other wine companies is the ownership of numerous spirit brands such as Svedka vodka, and Black Velvet whisky.  When Anheuser-Busch InBev tried to acquire Grupo Modelo earlier last year, it was revoked due to an anti-trust law and Constellation got ownership.  This means that Constellation is now able to produce and distribute Corona, Pacifico, and Modelo brands to US consumers. 

However, recently Constellation is getting some negative feedback about its popular beer Corona.  People think they are selling crappy beer with the glorified feeling of being on a nice sunny beach.  Although it is the 5th bestselling beer in America, beer experts tend to feel otherwise:
After 3,200 reviews at RateBeer.com, Corona has a grade of 1.69 out of 10. The Beer Advocate gives Corona an “awful” rating of 55 out of 100 and the following description: “faded aromas of sulphur, faint skunk, mild cooked veggies.”
Last holiday season Corona  "rolled out the same tired old ads" of a palm tree with holiday light. Are people getting sick of the "sand, sun, and lime wedge" image that Corona advertisements portray?
I think that the new ownership of these beer brands should come with a brand new advertising campaign. After all, beer is all about marketing. I do get that Constellation doesn't want to interfere with a campaign that is already profitable.  Perhaps they could jazz up another beer that they distribute, that is of better taste and quality.  It will be interesting to see the campaigns that Constellation sets out this year during the Super Bowl!

 

2 comments:

  1. The problem with this company for me is that they basically are an anti-brand. If I am purchasing alcohol and I notice that a product is under Constellation or some other super-brand like Gallo I will avoid the product and choose one produced by a less-well known company. It's pretty simple - these companies make crappy alcohol. Gallo or Constellation wine is to real wine what taco bell tacos are to real tacos.

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  2. I'm not really familiar with any of the big names in wine or beer industries. My probable guess would be because any alchohol beverage I purchase and it is the same for my coffee is the small batch, local producers. Well, the same goes for my food as well. I very very very much dislike, any big food companies, because the bigger and more mass produced they get the lower the quality of the product. I guess my taste for small, local and seasonal producers comes all the way back from where I grew up. Back home in Uzbekistan we know exactly where our food comes from, starting with salts, meats, chocolate and finishing with fresh produce and alcohol come from around the country and some parts of the ex-Soviet Union's countries. It gives you confidence, joy and satisafaction knowing how your food is being produced and where it comes from.

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