Beer Ads Join Campaign Brew-Haha

Summer beer ads usually focus on babes, beaches and barbecues. But as the U.S. celebrates its independence, the latest beer war has entered unusual territory: patriotism.

In a recent series of commercials, Miller Brewing Co. (search) proclaimed itself the "President of Beers" — a direct jab at Budweiser's "King of Beers" slogan.

Anheuser-Busch (BUD) struck back with a mudslinging mule who challenged Miller as un-American since Miller's parent company was once named South African Breweries.

And that's just the beginning of the fireworks.

Each company produced a string of commercials that took patriotic potshots at each other.

In one ad, a Miller spokesman debates a mute Clydesdale. The spokesman ridicules the "King of Beers" monarchy and tells consumers to be democratic and vote for Miller as president.

That struck a cord with A-B.

"They were attacking icons they shouldn't have been attacking," said Bob Lachky, VP of brand management at A-B.

A-B then rallied its beer distributors, asking them to "unleash the dawgs" on Miller.

Distributors responded by stealthily putting "Queen of Carbs" stickers on Miller products.

The conflict then spilled over to the courts, with Miller suing St. Louis-based A-B for "false, unfair and illegal" marketing activities. There were even charges that A-B was promoting homophobia with its "Queen of Carbs" stance.

Some aspects of that suit have been dropped, while others are still pending.

"[Miller] said, 'We're just having fun," said Lachky. "Then the minute we started to have fun, they ran to court screaming for help."

As the multimillion dollar marketing battle continues, experts say the fight is starting to look more like a childish playground spat than a barroom brawl.

"It's gotten juvenile," said Brian Sudano, a Beverage Marketing Corp. (search) consultant.

But even though the humor is sophomoric, experts say it's helping Miller to get an edge.

"For the first time, Miller's not being beaten up by their competitor," said Tom Pirko of the consultancy Bevmark.

Miller Lite's (search) sales had been falling for a decade but got a boost after the competitive ads began. Shipments of the brand increased 12 to 14 percent for September through March, according to the newsletter Beer Marketer's Insights.

But A-B doesn't look like it'll be dethroned any time soon. The St. Louis-based brewer remains the category leader, controlling half of the U.S. beer market.

Miller, owned by London-based SABMiller (search), has 18 percent of the marketplace. As for the rest of the summer, Miller is keeping on the offensive. New ads claim that consumers prefer the taste of Miller's Lite and Genuine Draft brands to A-B's Bud Light and Budweiser brews.

A-B says they're not going to directly respond to those new ads.

Instead, Budweiser ads will focus on the general topic of "freshness." But the competitiveness still remains behind the scenes at A-B.

"Why answer to somebody who is inferior in quality and taste?" Lachky said. "We've got a freshness advantage that's kicking their fanny in the marketplace. They're not going to win."