About a year and a half ago, in May 2023, Mexico’s Modelo Especial became the most popular beer brand among U.S. consumers and has remained so ever since. It was not an unexpected ascension. Many experts had predicted that Modelo Especial would eventually surpass Bud Light in sales. What was surprising was that it happened when it did, as it required almost a perfect storm of contributory factors, from marketing savvy and shifting demographics to a competitor caught in the crosshairs of the culture wars.
The politics
Bud Light’s 22-year reign atop the U.S. beer market ended amid a storm of controversy. In March 2023, Bud Light was still clearly the most popular beer in the the countryU.S., with a market share of 10% compared to 7.7% for Modelo Especial. Then, in April, transgender influencer Dylan Mulvaney promoted Bud Light in an Instagram post, causing a few outraged conservatives to call for a boycott of the beer. When Bud Light subsequently failed to stand by Mulvaney — she later said she felt abandoned by the brand — liberals were outraged, too. It was a devastating one-two punch and by May Modelo Especial had overtaken Bud Light for the top spot.
View this post on Instagram
The culture war controversy badly damaged Bud Light — the brand’s losses in the wake of it were estimated to be well over a billion dollars — and undoubtedly helped Modelo Especial become the country’s most popular beer when it did. But it was going to happen anyway. “This was long a matter of, if not when. These trends have been building for a long time,” Bart Watson, chief economist for the Brewers Association told CNBC. “Modelo has been on a rise and Bud Light’s been on a decline as we’ve seen overall shifts in the beer market in the last 10 years.”
The demographics
Demographics are part of the reason for Modelo Especial’s rise. The Latino population in the U.S. has been steadily growing and now makes up a more significant part of the population than it did a decade ago: 19% in 2021 compared to 13% in 2013. Much of that 62 million-strong bloc is Mexican-American. In fact, according to statistics from the 2020 census, almost 36 million Americans have roots in Mexico (or as high as 40 million if you count the estimated four million unauthorized immigrants from the country). But even without factoring in the latter, Mexican Americans are now a robust 10.8% of the U.S. population — and many of them are of beer-drinking age.
In all but one U.S. state, White Americans make up the largest group of those aged 65 and older. Latinos, by contrast, are a rising force in the demographic categories beermakers covet most, accounting for 20.7% of those aged 35 to 44, 21.5% of those aged 25 to 34, and 23.6% of those 18 to 24. Even more importantly, perhaps, they make up 25.8% of potential future beer drinkers, those aged 5 to 17.
This demographic shift has proven especially favorable to Modelo Especial, helping to push it past Bud Light and another popular Mexican beer, Corona Extra, in popularity. “Corona is for an older, whiter audience,” notes Matthew Barry, insights manager for Euromonitor International, via NBC News. “Modelo Especial has been positioned, on purpose, for a younger, more diverse market.”
The Mexican beer boom
That’s not to say Corona Extra isn’t doing extremely well in the U.S. It has remained a brisk seller, along with Coronita Extra and Corona Familiar. Mexican beer brands Pacífico and Dos Equis are also firmly entrenched among the top 20 beers favored by U.S. consumers.
Sales of Mexican beers, in general, are booming. It’s perhaps not surprising when one considers what an overwhelming share they now hold of the export market. In the early 1990s, it was 17%. Today, it’s 80%. As The Washington Post points out: Mexico sells more than twice as much beer in the U.S. as any other suds-exporting nation. The Netherlands is a distant second.
Lest one thinks it’s only Mexican beers that are now flying off shelves, it should be noted that tequila and mezcal are also logging record sales, with the volume of the two combined increasing by a staggering 273% between 2003 and 2022.
Marketing savvy
The success of Modelo Especial is due to more than political controversies and shifting demographics. After all, the fastest-growing markets for the beer brand are now near the Canadian border, which are not exactly Hispanic hotbeds. For this, the credit should go to New York-based Constellation Brands, which by dint of a decade-old legal decision lucked into the opportunity of a lifetime.
When the Belgium-based AB InBev, already the owner of Anheuser-Busch, purchased Mexico’s Grupo Modelo for $20 billion in 2013, the U.S. Department of Justice decided it was too close to a beer monopoly for comfort and filed an antitrust suit. The upshot was that AB InBev maintained global rights to Grupo Modelo brands. However, the U.S. rights were instead divested to Constellation Brands, which has seen its company valuation surge from $8 billion to $45 billion in the 11 years since.
It has been well-earned. Constellation Brands has made all the right moves, with savvy marketing that has stressed Modelo Especial’s connection to authentic Mexican culture and ads touting its “fighting spirit.” Promotion via partnerships with several popular sports leagues — the UFC and NCAA College Football, notably — helped to establish it as the fastest-growing beer brand, and Constellation’s distribution has been up to the task of meeting increased demand as the company has invested in more Mexico-based brewing facilities.
Modelo Especial in Mexico
Ver esta publicación en Instagram
Modelo Especial is still exclusively brewed in Mexico, and yes, it’s the most popular beer in its home country, too – at least according to a Statista survey from November 2023 that showed it ahead of Victoria and Heineken (currently the world’s most valuable beer brand).
So as Modelo Especial quickly approaches its 100th birthday (it was first brewed in 1925) it’s now more popular than ever, and that popularity should only continue to grow.
Chris Sands is the Cabo San Lucas local expert for the USA Today travel website 10 Best, writer of Fodor’s Los Cabos travel guidebook and a contributor to numerous websites and publications, including Tasting Table, Marriott Bonvoy Traveler, Forbes Travel Guide, Porthole Cruise, Cabo Living and Mexico News Daily. His specialty is travel-related content and lifestyle features focused on food, wine and golf.
