Corona, Corona Hard Seltzer, Constellation discussed on Business Wars Daily
From wondering I'm David Brown and this business wars daily on this Tuesday march tenth. Wow It's been a long few weeks as anxiety's been mounting over this corona virus no surprise that the viruses hit many businesses especially those with global supply chains in companies that sell rely on travel. But there's one company hit hard because of branding. Yes you guessed it that would be corona the maker of beer and hard seltzer. It's sales slowed tremendously because many Americans. It seems are confused about the association between the beer and the virus. Oh Com on. They are not the last couple of weeks. Misleading story went viral. It implied that Americans are so dumb. That many of us believe the beer can cause the virus that message spread by a certain less than honest public relations firm seemed to indicate that sixteen percent of us are confused about the relationship between corona the beer and corona the disease. That's killing people. It also implied that Krona's beer sales had fallen because of the virus. The story was so convincing that many major news outlets picked it up including CNN. The New York Post and vice among others not surprisingly twitter went Gaga over this story. None of it's true. Let's talk for a minute about the difference between correlation and causation. Shall we correlation means? Two things are happening Ed once but may have little to do with each other causation. Means well okay you get it. This is key to what happened. So a firm called Five W. P. R. published a poll of more than seven hundred Americans. That poll asked questions about the corona virus and about corona the brand one of the findings. According to this firm. Thirty eight percent of those polled said they would not by corona beer under any circumstances now as a writer for the Atlantic noted the PR firm then went on to state without proof. The reason these respondents won't buy corona is because of the virus not so in fact many or even all of those thirty eight percent may not have been corona drinkers to begin with as was reported in the Atlantic. They might not by corona regardless. But that's not how the PR firm chose to sell it in fact that firm trumpeted the so-called finding saying who would want to go into a bar right now in order corona well in in fact corona sales have fallen. That's in part because sales of many beer brands are down in China at a time. When beer sales usually climb we're talking about the lunar brew year a New Year Abn Bev which distributes corona outside of the US forecast day ten percent decline in sales in China because people are staying home. That's according to the fact. Checking website slopes so that particular sales declined does appear to be a corona virus effect. Just not related to the name of corona beer. What got much less play as a statement from Constellation brands which distributes corona inside the US in America Constellation said. Sales grew five percent in the four weeks that ended February sixteenth. That's double the sales trend for the last year. Snoops reported constellation clearly felt it was necessary to correct the wild misconceptions in a press. Release the firm stated that its customers quoting here understand. There's no link between the virus in our business. Exactly giving constellation brands even more headaches. However was the unfortunate coincidence between its long planned on brand marketing campaign for hard seltzer and the growth of corona virus. Constellation is spending forty million dollars on a marketing campaign to launch. Its New Corona Hard Seltzer in North America according to industry publication food dive. It's slogan coming ashore soon. The new campaign coincided with the first big warnings that corona virus was coming ashore to countries outside China including the US. Twitter of course reacted with many complaining. That coronas campaign was in bad taste. The hard seltzer market is booming however rival white clawed did one and a half billion dollars in hard seltzer sales last year according to CNBC and Constellation is sticking with its campaign but we bet that it's marketing folks have taken more.