Much like how in my first article, companies and brands you may have thought were mortal enemies and competitors, were actually owned by the same companies, alcohol follows a similar pattern. In my previous article, I spoke about how you may have seen Fanta, Sprite and Coca-Cola as rivals but in reality, they are all brands of the Coca-Cola Company. This is similar to the alcohol industry, where you may see beer and cider companies as rivals, but often they are both sold by the same company.
Diageo (UK)
Diageo was birthed in 1997 from the merger of Guinness Brewery and Grand Metropolitan. It currently owns over 200 brands, sold in more than 180 countries, making it one of the biggest alcohol companies in the world. It has well-known brands in Whiskey, Vodka, Tequila, Gin, Rum, Liquers, Beer and Wine, clearly demonstrating it has no loyalty to one type of alcoholic beverage. As a show of just how many well-known brands they have, here is an example. Three people walk into a bar on Christmas eve, one orders Rum getting a Captain Morgan, the other gets a Gin, ordering Gordons and the other orders Vodka, getting Smirnoff. They then order some Don Julio Tequila shots to get the night going, a few hours later, they want to start winding down the night with calmer drinks, so one of them orders a Guiness, the other a Baileys and the last friend a Johnnie Walker Scotch Whiskey, well they can all cheers to a good night and Diageo, as they are all brands of the company. Quite incredible just how many big names they have and that is not all! Some other well-known brands are Cîroc, Sheridan's, Pimm's, DeLeón, Casamigos, Tanqueray, Gilbey's and Aviation Gin. Diageo's revenue in 2021 was $19,153 billion and a net income of $2,799 billion (Page 142).
Heineken International (Dutch)
Heineken International's history goes back almost two centuries to 1864, when founder Gerard Adriaan Heineken took over the Haystack brewery in Amsterdam. Today their catalogue has grown into over 300 brands across more than 190 countries. Much like Diageo, Heineken International own many well-known brands, mainly across beer and cider. In cider they own three brands you see in every pub and shop (Depending what country you live), Bulmers, Old Mount and Strongbow. They also own Orchard Thieves and Stassen Cider. In beer they own huge names like, Heineken, Amstel, Sol, Kingfisher, Edelweiss, Lagunitas IPA, Desperados, Tiger and Birra Moretti. Their 2021 financial report displays a net revenue of $21,941 billion and a net income of $3,535 (Page 71).
AB InBev (US-Belgium)
AB InBev was formed following the merger of American brewer Anheuser-Busch and Belgian-Brazilian brewer InBev, which in turn is a merger of AmBev and Interbrew. AB InBev which although does not have as many big names in the UK or US, is still the biggest by far in revenue terms. Their 2021 revenue was $54.3 billion, more than double Diageo and Heineken (Page 7). Their internationally renowned brands include Budweiser, Corona, Stella Artois and Beck's. Other brands include South Korea's number 1 beer Cass, Brazils Brahma, Juplier, Belgiums number 1 beer, Modelo a popular Mexican Beer and many more. Due to the fact they are merger of three companies from different countries, they have many big brands spread across multiple countries.
Scandals
In 2007 Dutch Brewers Heineken, Grolsch and Bavaria were fined €273 million "for operating a cartel on the beer market in The Netherlands". InBev was also part of the cartel, however avoided getting fined, as it provided information about cartels operating around Europe, as well as this one. Similar to what I discussed in my first article, of how Unilever, P&G and others were price fixing as a corporate cartel, these brewers had a similar operation going on. Between at least 1996 and 1999, the brewers held multiple unofficial meetings, during which they coordinated prices and price increases of beer in the Netherlands. The Competition Commissioner Neelie Kroes stated "It is unacceptable that the major beer suppliers colluded to hike up prices and carve up the market between themselves. The highest management of these companies knew very well that their behaviour was illegal, but they went ahead anyway and tried to cover their tracks." This of course goes back to few companies, having too much market power and artificially over-charging, in a monopolistic fashion. A minority of giants nationally or internationally, can get together and collude to hike up prices, to both the distributor and the consumer. Anheuser-Busch InBev was fined $6 million by the Securities and Exchange Commission in America for using "third-party sales promoters to make improper payments to government officials in India to increase the sales and production of Anheuser-Busch InBev products in that country" and also trying to silence a whistleblower. Diageo's subsidiaries were also caught making payments to Indian, Thai and South Korean officials to "obtain lucrative sales and tax benefits" and was fined by the SEC $16 million.
Between just these 3 companies, they dominate the most popular brands in multiple countries. The companies are often sponsors of big events and unlike the tobacco industry are not restricted through advertisement. I have no issue with the consumption of alcohol, I am a more than regular weekend drinker and pub attendee myself, however, the constant advertisement around sport to make sure you don't forget to get another drink before, during and after the game is a little much. Heineken has been the sponsor of UEFA for years and continues to, sponsoring the champions league, the Euros and the World Cup. It also is a sponsor of Formula 1. The fact companies that own a huge market share, advertise and sponsor regularly, can be caught illegally price fixing and then still be allowed to operate in the same way is madness. Anyone else when charged with doing something highly illegal, goes to prison, is highly limited when trying to get a job and is shunned by society, instead with big companies, it is business as usual, and the individuals are not penalised, only the company in name, via fines. I hope this article again shines a light on just how many brands are shared between few companies and the power the giants have in influencing governments around the world and brushing off employee criminal behaviour, often in management, to only fines in the company's name.