Bud Light - The Poster Boy For Brand Mismanagement

Well, Bud Light has become the poster boy for brand mismanagement from multiple perspectives. So let me, let me lay it out for you because the discussions that have risen and the narrative that's risen around Bud Light is probably a good lesson for every CEO in every sector of the economy.

Number one, it highlights the power of social media. This issue went viral in 48 hours, yeah? And most often, when an issue goes viral like that, it burns out in another 48 hours. But that's not what happened here. The story and narrative changed to sales, and people that did not like the message, regardless of where you stand on these social issues or gender narrative or whatever, they took it out by basically boycotting the product immediately.

They switched preference to other brands that did not make them get involved in this issue. Other viral videos go on social media, like Kid Rock shooting Bud Light cans and people dumping Bud Light, and all, and so that just adds to it, right? Well, it's because that narrative became very powerful and people piled on.

Now, if you're trying to manage that and trying to learn something from it, and I certainly talked to all my CEOs about this, because here we are talking about it in its second month. Yeah, this is a nightmare from hell for the brand and the sales don't... they haven't... some brands in the Anheuser-Busch have had declines getting lesser, but Bud Light's still down big. This is worse than New Coke, old Coke, and it's becoming its own story for the ages.

I'll be teaching this one at Harvard, there's no question about it because you have to ask yourself, in crisis management, what do you do? Because if you go to the other side and try and balance the gender narrative, you're going to get a whole new onslaught of people, yeah, that don't like that.

And there have been bars that have banned all Anheuser-Busch products because Bud Light tried to distance itself from Dylan Mulvaney and what happened. So the lesson learned and what everybody should think about in every consumer product category, when you take polarized positions on any narrative, you are going to alienate 50% of your consumer 100% of the time.

So if you're willing to do something very controversial because you think it's going to go viral in a positive way, you need to analyze the downside in a negative way as well. In consumer goods and services, Republicans drink beer, Democrats drink beer; some believe in gender neutrality, some don't, but they all consume your product.

So if you know that with certainty and you have billions of dollars of capitalization at stake, why would you go down that road in the first place? And so if I were a board member there saying, show me who's responsible for this? Because at the end of the day, when you go into new territory, consumer goods or services like changing the flavor, as Coke found out decades ago, you need to own that as the CEO.

If you're the man or woman running this thing, you need to own it 100% because you can't blame it on a brand manager; you can't blame it on an advertising agency. You own it. And so now what's happened within Corporate America, and I can assure you this has been a conversation in every boardroom, is who's running the brand here?

Who's deciding what networks we post on? Who is actually doing our social media? Who is actually calling the shots on the content? Because never before has the control of content, after those frames leave and get posted, you don't have control of it anymore. The rest of the world decides what they want to do with it, and you've given plenty of examples of it, how it gets reposted and used to promote other people's narratives.

Yeah, and so that brand got decimated, and at the end of the day, I'm sorry to say this, but the CEO, it's their fault. So what? Okay, let's say I'm Bud Light. I'm on Shark Tank. I need money and, and you get... I give you, uh, Mr. Wonderful, give us 20%, I'll give you a 20% stake, help us. What would you do? How would you fix this? Can you fix this?

Well, as in, you know, I look at the decimation of the brand within a portfolio of brands. I mean, Bud Light used to be the go-to college beer, the Colorado pure water story, all that stuff; it got decimated here. It's no longer that beer; it's a beer with a sordid past.

And so you have to think about what do you do with that? How do you creatively dig yourself out of that hole? How do you re-establish that brand? And I'm not sure there's a clear path right now; everybody involved in that brand is begging for the media to stop. And here you are with me talking about it again months later, yeah?

And it's not the only conversation I've had. And so when I now talk about branding and managing brands, and I teach young cohorts, mostly graduating engineers, which is where I focus, this is the case. This is the one that you're actually living today.

And so for me, what I would, if I had to try and, you know, think about how would you manage out of this hole, the first step is stabilization. The first step is to stabilize the decline; stop it from declining. That's not easy to do, though. No, it's not.

But you can't think about gaining share yet; you just have to stop the narrative and cauterize the wound and then go from there. You know, there's lots of metrics, and we do this in our own businesses; you can actually monitor by the hour on every platform what is occurring, okay?

And so you have to find... If I were doing this, I would have that analysis in front of me saying where are the green shoots in this story? Where are we getting some support? Where are our users talking about their childhood growing up with Bud Light? You know, Bud Light as a favorable choice on a caloric basis, on a nutritional basis, whatever it is.

Where are the green shoots? Where do we spend there? Because Bud Light is a light beer. There is demand for light beers, particularly amongst beer-drinking men over 40. I mean, you got to go there and find those green shoots. And you know, clearly, when you're in crisis mode and the heads are going to roll, it's just too much capitalized loss.

It's just too much! Influencers are part of the deal now, right? Brands need influencers; they use them on all different ways—TikTok or whatever—but you're using people; you don't know exactly what they're gonna do, right? You hope they do something good for you, but it's a danger, isn't it?

It is. So I have a pretty big advisory business, and I work with a lot of financial services companies, insurance companies, tax companies where they hire me to be a paid spokesperson. So let me give you my perspective of my role in these.

First of all, never be a spokesperson for a brand you don't actually consume or use—that you don't personally use—because that's the only way you'll understand the DNA of the brand. So companies need to know when they're hiring an influencer, they're hiring a user. Yeah, prove to me that you use my product.

You know, when I think about companies like StartEngine that do equity crowdfunding, I'm just naming off some of my paid spokesperson's role. I'm not only am I a paid spokesperson, I'm an investor in the company because I use the platform. I think about WonderTrust, which is an employee retention credit program. I use that platform for all of my companies to go get their credits.

Because right now, banks aren't lending, so we get up to $26,000 per employee, and I'm all over the networks now promoting wondertrust.com. If you don't have your ERC, that's where we go to get it. I think about Tax Hive Financial Services we're talking about here. I use all of these products in my portfolio or personally, so that's number one.

When you're hiring a paid spokesperson, why and how do they know your brand? Do they use it? Number one. Number two, are they able to read the room? In other words, I understand the consumer of the, you know, employee retention credit; it's a small business owner with five to five hundred employees.

I know who they are; there's millions of them in America. I know what matters to them. I make sure I don't go down some narrative that's irrelevant to my constituency. So when you go into gender narrative on a beer, which is primarily consumed by men, maybe you should have thought a little bit about that in reading that room.

Maybe you should say, "Well, does this really fit my consumer's psyche and narrative?" This is important. And then lastly, do you understand the responsibility you have as a paid spokesperson? You are basically being trusted by the board of that company to help them expand their business and reduce their customer acquisition costs.

You own that at six in the morning when you wake up and at eleven o'clock at night when you go to bed. How have you modified your life to be responsible? You can't get in a car and do something crazy; you can't expect to do something off-brand in the night or, you know, out in the evening and not think that that's not going to get back to you.

You are now effectively being watched 24/7 because they're spending millions of dollars putting you on television on social media and talking about you, and you have to live your life according to that metric. And that was the thing that I realized so much when I got into this business is how it forced me to change the way I lived.

You know, I love wine; I have a wine business; I sell hundreds of thousands of cases a year. But you can't drink too much of it. I can't drink too much of it, and I can never drink it and get in a car ever again. Not that I'm admitting I ever did, but that's something I can't take; I can't take drugs. I can't, you know, not that I want to, but it made me realize if I'm going to take this role and this responsibility.

And you know who told me this? My 29-year-old daughter. Really? Yeah, she said, "You know Dad, the one thing that you don't understand is you're so scrutinized now. I see you everywhere! Yeah, one bad move, and you're canceled." Everybody recognizes you pretty much, right? I mean, you use the word "you'll be canceled."

I said, "What are you talking about?" She said, "I'm not kidding! Just look at these feeds; look at how many hundreds of thousands of comments there are in this stuff, good, bad, and ugly, and they're watching you 24/7. The company will cut you right away." Yeah, and so for me, and then as time passes, and I've been doing this for years now, if you can gain the trust of a board of directors of a company that's in financial services, more come knocking.

But I've already modified my life in the way I work for the first deal. I have no choice. I don't know if I'm ever going to be the wild Mr. Wonderful I used to be; I just don't think I'm going to get to do that. But maybe I'm older anyways; a little less fun, but more money.

Well, yes, but I... I don't, you know, it's a great question when you're asking me because people say, "Do you do that for money?" No, no, I really enjoy the work; I really enjoy what I do, and I love the challenge of gaining market share and reducing customer acquisition costs for all of my companies I invest in.

And when people approach me and say, "Oh, we want you to be a paid spokesperson for our company," I say, "I don't own your company. I don't own any of your company. I'm not doing it unless I own a piece of the company so that I'm in the shareholders’ shoes and I understand their journey."

So like that, exactly like Shark Tank, you're always buying in, and so I'm actually investing in their company and they're paying me to be a paid spokesperson because I believe in their mandate and their mission. And I think that, in my view, that keeps you young. I really enjoy this work.

Alright, lastly, you talk about the financial services, how is the economy in your view? It's getting more difficult right now for companies to get investment, right? To get money to be able to get capital? It is, and I'll tell you why. In a nutshell, everything changed a few weeks ago in the collapse of Silicon Valley Bank, First Republic, and Signature.

All of a sudden, all the regional banks, the 4,500 of them, are not lending anymore, uh, as we speak. Congress is debating this; the members are talking about it—there's hearings about the collapse of Silicon Valley Bank. Hagerty put out a bill, the deposit bill. I met with him in Washington yesterday and his staff.

He's got a solution that simply says, "Okay, for the next 24 months, any bank account in a regional bank will guarantee it up to a hundred million dollars if it bears no interest." Now, who's going to put money in an account with no interest? Only payroll on Wednesdays. So, he's trying to protect payroll in regional banks. That makes sense to me, but it's not an imputed guarantee for everything.

And so that's not going to stop the consolidation of small banks. We have 4,500 now; I bet you within three years, four years, there'll only be 800 left. They're going to have to get together. That's what happened in England. That's what happened in Canada. That's what happened in Australia. That's what happened in Switzerland, Europe, France, Germany—all of these places much fewer banks with imputed guarantees. That's where we're going.

Mr. Wonderful, you can see him of course as always on Shark Tank and also he's chairman of O'Leary Ventures. Kevin O'Leary, thank you so much for being with us. You got it, thank you.