Is Corona Beer facing loss because of name confusion with coronavirus? Fact Check
Messages online claim that the owners of Corona, the lager brand, have reported a significant loss in profits due to people confusing it with the 2019 coronavirus outbreak.
FALSE
An example of such a claim is below.
The fact that Corona Beer is experiencing profit loss shows you that there is a problem with the IQ level of the general population.
It is true that the owners of the Corona brand, Anheuser-Busch In Bev (ABInBev), have reported a £132 ($170) million loss of earnings over the last two months amid the outbreak of the 2019 coronavirus. However it is unlikely down to the fact that customers were confusing it with the coronavirus itself.
Firstly, AB-InBev are a large drink and brewing company that own a number of different and popular drinks brands. This includes Budweiser, Stella Artois, Becks and Leffe, as well as Corona. The $170 million in loss of earnings has not been directly attributed to the Corona brand in particular, rather a loss of earnings largely across the entire range of products it owns.
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And secondly, the reason why this loss of earnings has occurred – while certainly related to the coronavirus outbreak – isn’t likely due to any confusion in similar sounding names. It is simply because the coronavirus outbreak has led to a significant drop in alcohol sales across the board, as increasingly large amounts of people – especially in China and other countries in Asia – are not socialising in public places as they normally would.
This detrimental effect has been worsened considering the coronavirus outbreak has occurred during the Chinese New Year time period; a period that is usually profitably for alcohol companies.
AB-InBev told reporters –
The outbreak has led to a significant decline in demand in China in both on-premise and in-home channels. Additionally, demand during the Chinese New Year was lower than in previous years as it coincided with the beginning of this outbreak.
Additionally, AB-InBev CEO Carlos Brito told reporters –
Our business is all about going to restaurants, to nightlife, going out with friends, it’s really about to go back to normal, we’re preparing for the surge when things return to normal.
To confirm this point, AB-InBev are not the only drinks company to report a substantial loss of earnings over the period of the coronavirus outbreak. The company Diageo – owner of brands including Smirnoff, Johnnie Walker and Baileys – estimates a £200 ($260) million loss of earnings over the same period.
It appears likely this confusion has been exacerbated by the fact that many media outlets have singled out the Corona Beer brand in particular when reporting on this story because of the name similarity, despite the losses not being specific to this brand of lager.
Of course it is entirely plausible that a handful of people out there may not be aware that the coronavirus and Corona Beer are entirely unconnected. However, there is no evidence to suggest any loss of sales by AB-Inbev is specific to their Corona brand in particular, and the parent company’s loss of earnings is generally in line with other reported losses from other multinational drinks companies. As such, we rank the claim that Corona Beer is facing a loss of earnings because customers are confusing it with the coronavirus as false.
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