(WTVO) — Wall Street analysts have downgraded the stock rating on Bud Light’s parent company after sales continue to freefall following the beer’s partnership with transgender influencer Dylan Mulvaney a month ago.
According to CBS News, sales of Bud Light have called 11% this year, and other Annheuser-Busch InBev brands, including Budweiser, Michelob Ultra, Busch Light, and Natural Light, are also down.
This led analytics firm HSBC to downgrade the company’s stock to “hold” on Thursday.
“The way this Bud Light crisis came about a month ago, management’s response to it and the loss of unprecedented volume and brand relevance raises many questions,” the analysts wrote, saying “the trend of declining beer volumes is worsening and may be down more than 25% in April,” while “US distributor relations appear to be at an all-time low.”
“It is unclear how ABI will reverse eroding U.S. volume and brand relevance, and fix distributors’ trust, without leadership changes,” analysts said.
Last month, the beer company sent cans of Bud Light featuring Mulvaney’s face to the influencer to celebrate a full year of “girlhood.” Mulvaney posted photos posing with the cans to Instagram with the hashtag #budlightpartner.
Three days after Mulvaney’s post, Kid Rock posted a video of himself shooting cases of Bud Light. Shares of InBev, the parent company of Anheuser-Busch, temporarily plunged.
The Bud Light-Mulvaney partnership quickly brought an onslaught of criticism from people who said they were angry about the company going “woke.”
Within weeks, two marketing executives at Anheuser-Busch took a leave of absence, including vice president of marketing, Alissa Heinerscheid, and her boss, Daniel Blake.
Anheuser-Busch InBev CEO Michel Doukeris this week downplayed the impact of the backlash, saying, “This was one can, one influencer, one post, and not a campaign.”
The company then launched a patriotic ad campaign, which could be seen as a pinned tweet on its Twitter account.
A Budweiser distributor in Missouri canceled events featuring the Budweiser Clydesdale horses, citing safety concerns.
A TikTok video posted on Wednesday shows Boston Red Sox fans at Fenway Park standing in line for refreshments at other concession stands while the Bud Light stand is deserted.
While working-class beer drinkers shun Bud Light for its perceived alignment with gender politics, it alienated left-wing activists who are angered that the company did not stand behind its transgender advocacy.
WGN reported that some Chicago bars announced Friday that they will not be stocking Bud Light because the company has not reaffirmed its support for the LGBTQ community in light of the controversy.
Bud Light’s partnership with Mulvaney is part of a recent trend of popular brands promoting transgender personalities in traditional women’s roles. According to CNN, companies like Pantene, Gillette, Citi, and Adidas have made headlines for hiring transgender spokespersons.
In March, chocolate company Hershey chose to market an image of a trans woman in celebration of International Women’s Day.
Critics say the brands are promoting a caricatured version of femininity.
Olympic medalist Caitlyn Jenner, a transgender woman, condemned Nike for partnering with Mulvaney to promote a line of sports bras, saying the brand was trying to “erase women” from sports. Other female sports stars have expressed similar concerns.
Marketing experts say it’s possible Bud Light’s experience will cause other brands to rethink using transgender people in their advertising. Joanna Schwartz, a professor at Georgia College and State University who teaches a course on LGBTQ+ marketing, said companies will still want to reach transgender consumers and their supporters, but might shift to social media and more targeted ads.
According to a 2021 Gallup poll, 21% of people in Generation Z identify as lesbian, gay, bisexual or transgender, compared to 3% of Baby Boomers. Gallup has also found that younger consumers are the most likely to want brands to promote diversity and take a stand on social issues.
The Associated Press contributed to this report.