Miller Brewing Celebrates 150th Anniversary

Like many other beer companies, Miller Brewing's history began in Germany where company founder Frederick J. Miller learned the trade and later immigrated to the United States in 1854, according to Miller Time: A History of Miller Brewing Company, a new book by local Milwaukee author John Gurda.

Miller eventually made his way to Milwaukee, and in 1855 bought and reopened the shuttered Plank Road Brewery. He was attracted to Milwaukee in part because of its heavy German population, which provided a natural customer base, since beer at the time was still considered an ethnic beverage, according to Gurda's book.

After 150 years in the business and countless Miller Times, the company has come a long way: It is the nation's second-largest brewer, selling 39 million barrels of beer a year; it employs 6,200 people (of which 1,700 are in Milwaukee); and it has 430 wholesale distributors that ship its beer all over the world.

As the company commemorates its 150th anniversary, company executives point with pride to the brewer's growth and innovation, especially during the 1970s, when Miller virtually invented low-calorie beer, a segment that now dominates the brewing industry, according to a special report in the Milwaukee Journal Sentinel.

In 1975, the company launched Miller Lite and accompanying television ads featuring former athletes arguing over whether Miller Lite was better because it "tastes great" or because it was "less filling," which were instant hits. Known as the Miller Lite All-Stars, the campaign ran until 1990, the Journal Sentinel reported.

Miller Brewing grew rapidly, and began closing the market share gap between itself and long-time industry leader Anheuser-Busch. By 1981, Miller bypassed such declining players as Schlitz and Pabst to become the nation's second-largest brewer. But by the early 1980s, the entire beer industry began experiencing a sales slowdown as the business matured.

While Miller Lite continued growing, the company's signature brand, High Life, was facing the dilemma of being a full-calorie beer in a world where more drinkers wanted low-calorie brews. Miller in 1986 launched Miller Genuine Draft, which quickly became its leading full-calorie brand, and High Life's price was cut to reflect its declining status.

Meanwhile, Anheuser-Busch in 1982 launched Bud Light. While it took over a decade for Bud Light to catch up to Miller Lite in sales, the new brand managed to stunt Miller Lite's rapid growth almost immediately, according to the book Beer Blast by Philip Van Munching.

By 1994, Miller's market share peaked at 22.7 percent, according to trade publication Beer Marketer's Insights. But then Miller entered a prolonged slump.

Full-calorie brands, such as High Life and Genuine Draft, fell out of favor. Miller Lite, having dropped the All-Stars, went through one forgettable ad campaign after another, and began losing ground to both Bud Light and Coors Light. An ill-fated launch in 1996 of a full-calorie brand, named simply Miller, was a costly, well-publicized failure. And other brands launched by Miller, such as Red Dog and Icehouse, stagnated after their initial success.

In 2002, Miller Brewing was acquired by South African Breweries Plc, a London-based global brewer that was later renamed SABMiller Plc. Less than a year later, Norman Adami, a South African Breweries executive, was named president and CEO of Miller and immediately began shaking things up with a streamlining of Miller's corporate structure and the launch of aggressive marketing campaigns that included taste tests pitting Miller Lite against Bud Light.

As a result, Miller Lite's sales began picking up in the summer of 2003. In 2004, Miller Lite's sales increased 10.5 percent, according to Beer Marketer's Insights. The nation's overall beer market increased just 0.6 percent last year. Meanwhile, Miller raised its market share for the first time in several years, and now claims 18.5 percent of U.S. beer sales, compared to Anheuser-Busch's 49.4 percent share, according to the Journal Sentinel.

As young customers today are attracted more to trendy spirits instead of beer, Adami is not daunted. Miller needs to continue the positive momentum of Miller Lite, which accounts for 40 percent of the company's sales and over half of its profits, he said. Other high priorities are Genuine Draft, High Life and Milwaukee's Best, Adami added. Along with the light and ice versions of those three brands, they account for more than 40 percent of Miller's sales. Industry observers have said it will be difficult to revive the full-calorie versions of those brands.

But beer drinkers are reconsidering their brands, according to a Adami, which presents a great opportunity for miller to take market share from Anheuser-Busch. "Miller is in the right place at the right time," Adami concluded.