April 29, 2009 / 7:18 PM / 9 years ago

AB InBev to cut Olympic TV ad spending in half: source

CHICAGO/NEW YORK (Reuters) - Anheuser-Busch InBev is not likely to remain the exclusive beer advertiser during NBC’s broadcasts of the next two Olympic Games, cutting ad spending and opening the door for rivals to get air time, a source familiar with talks between the companies said on Wednesday.

Anheuser-Busch has told General Electric Co’s NBC that unlike in past years, the brewer will spend only about half as much on advertising packages during the upcoming 2010 Vancouver Winter Olympic Games and 2012 Summer Games in London, said the source, who asked not to be identified.

Meanwhile, rival MillerCoors, the U.S. unit of SABMiller Plc and Molson Coors, is now trying to get into some ad slots during the Olympics, the source added.

Anheuser-Busch historically has been the biggest U.S. corporate sponsor in the sports world and is still eager to promote itself through sports, including its role as the official beer sponsor of the FIFA World Cup soccer tournaments in South Africa in 2010 and in Brazil in 2014.

The beer sector has been more resilient than other industries and its support is critical to the global sports industry because growth is slowing in most other sectors.

Anheuser-Busch InBev officials said they would not discuss the ongoing talks with NBC.

“We are in negotiations, with no final decision made at this time,” Dave Peacock, president of Anheuser-Busch Cos Inc, said in a statement.

“Anheuser-Busch Inc continues to invest in sports sponsorships, which includes a four-year renewal of the United States Olympic Committee and its teams through 2012,” he added.

NBC officials declined to comment, while MillerCoors officials could not be reached. The arrangement was first reported in the Wall Street Journal.

Anheuser-Busch emphasized its World Cup sponsorship again when discussing its plans on Wednesday. Last week, company executives told Reuters that the World Cup would play a critical role in the brewer’s marketing next year.

“The World Cup is going to be a large platform of ours,” Dan McHugh, Anheuser-Busch’s vice president of media, sponsorship and activation, said on April 22.

“We’ve got a major, major opportunity with the World Cup in 2010 across the globe from a marketing perspective and we’re going to take advantage of that,” he added.

While Anheuser-Busch InBev does not disclose its advertising budget, TNS Media Intelligence estimated it spent $53.3 million last year on TV ads around the Beijing Olympics.

The brewer increased its spending on U.S. advertising 17 percent last year to an estimated $612.5 million, of which $350 million was spent on sports-related TV ads, according to TNS.

“It’s a big number, let’s say that,” Keith Levy, Anheuser-Busch’s vice president of marketing, said when asked whether company spending on World Cup marketing would match the Olympics.

“You’d have to put it on par with the Olympics in some countries, probably above, in terms of fan passion,” he added. “Clearly, in my mind, it’s one of the premier global sports properties.”

McHugh also said then that the brewer’s budget for sports properties would be slightly higher this year, while Levy said the overall marketing budget, excluding last year’s Olympic spending, would be slightly off or almost even with 2008.

Editing by Maureen Bavdek

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