From Soap Suds to Beer Suds How Anheuser-Busch became the largest brewer in the world By Sanford Wexler U.S. subsidiary, has worked at the company for over 30 years. One out of two beers sold in the While Busch III is no longer chief U.S. is brewed by Anheuser-Busch of executive, as chairman of the board he s e v i h St. Louis. The family-run company remains heavily active in continuing to c r A e t traces its origins to the 1860s, but build and grow the world’s largest a r o p r o 2002 marks the first time in the com- brewer that produces over 100 million C h c s pany’s 142-year history that its presi- barrels of beer annually and has $12.9 u B - r e s dent and chief executive will be a non- billion in yearly sales. “My job is u e h n family member. This past July, August my hobby, my hobby is my job,” A e h t f “Auggie” Busch III, 65, who became Busch III once said. “I happen to o y s e t chief executive in 1975 and is the like it an awful lot, and I thrive on it. r u o C great grandson of the company’s I love competition.” Top: Budweiser pocketknife, silver, founder, Adolphus Busch, was suc- ca. 1890 – 1900. ceeded by Patrick T. Stokes, 59. Adolphus Busch Bottom: Budweiser “Bud Girl” Stokes, who was previously president The year 2002 also marks the 150th wallhanging, 1970s. of Anheuser-Busch Inc., the brewer’s anniversary of the founding of the Financial History ~ Winter 200230 www.financialhistory.org St. Louis brewery where one of Amer- Civil War, Busch joined his father-in- Busch was far from satisfied with ica’s greatest business success stories law’s brewery as a salesman. The highly the beer that his brewery was turning began. The Bavarian Brewery, which ambitious and enterprising young out. He reportedly called it “dot eventually became the Anheuser - Busch would transform the local St. schlop.” Busch was always on the Busch brewery, was established Louis brewery into a thriving national lookout for ways to brew a better tast- in 1852 in St. Louis. brewery. By 1869, ing beer. In fact, studying the brewing In 1860, Eberhard Busch had sold industry was his favorite pastime. Anheuser, a prosper- his brewery supply ous St. Louis soap business and had and candle manufac- bought out the The Birth of Budweiser turer, invested in the interest of Anhe- Around 1875, Busch teamed up with a bankrupt brewery. user’s partner. St. Louis wine and liquor importer, The brewery was Busch was now a Carl Conrad, who “discovered” a renamed the E. full partner with smooth, light tasting beer that was Anheuser & Co. his father-in-law. produced at a Bohemian brewery in Bavarian Brewery. the town of Budweis, then part of Shortly after taking Germany and now in the Czech over the failing brew- Republic. (Today, the town is called ery, Anheuser was Ceske-Budejovice). In collaboration introduced to Adol- with Conrad, Busch developed the phus Busch, a 22- formula for a new beer that imitated year-old German the light beer that was brewed in the town of Budweis. What made this immigrant who ran s e v i h c brew so unique was its natural car- a brewery supply business. Anheuser r A e t a bonation, which was based upon an was one of his customers. r o p r Busch, the son of a wealthy o ancient European brewing process C h c s called kraeusening. The beer is fer- merchant and landowner, arrived in u B - r e s mented a second time just when it New Orleans in 1857 with little u e h n is beginning to age. This brewing money and without any home or A e h t f process results in a distinctive, frothy- employment. What he did have was o y s e t barrels and barrels of daring ambi- r headed pale golden beer. u o c s In 1876, the beer that would tion. He traveled up the Mississippi o t o h River and eventually settled in St. P become the world’s most popular Louis, where he found work as a Top: Adolphus Busch brand — Budweiser — was introduced. “mud clerk.” Busch inspected steam- Bottom: August A. Busch Jr. The name Budweiser was coined boat manifests and sampled cargo. by Busch because he felt that despite When his father died, Busch drew its Germanic sounding name, it could upon his inheritance to establish a For his time, Busch was undoubt- be easily pronounced by Americans, brewery supply company. He already edly an innovative beer promoter. As and therefore appeal to both Ameri- knew something about serving up he traveled from tavern to tavern, he cans and German immigrants. Bud- pints of beer, as he once worked left a “calling card” that gave cus- weiser soon became the beer of choice in a brewery that was partly owned tomers a memorable and long-lasting for beer drinkers who preferred the by his father. impression of his St. Louis brewery. It light brew to the heavier, sweet The young Busch fell in love was a small jackknife with the E. beers that were on the market. with one of Anheuser’s three unmar- Anheuser & Co. logo on the handle. Budweiser would ultimately become ried daughters. Adolphus Busch and At the end of the blade was a tiny pic- America’s first national beer. At the Lilly Anheuser were married in ture of Adolphus Busch that could turn of the century, some one million March of 1861. The ceremony was a only be seen by looking through barrels of Budweiser was being double marriage affair of which a peephole. produced each year. Busch’s brother, Ulrich, married “Our business,” Busch repeatedly When Eberhard Anheuser died in Lilly’s sister, Anna. told his father-in-law, “is not just 1880, Busch became president of the In 1864, following a stint as a cor- making beer. No. Making friends St. Louis brewery, now called the poral in the Union Army during the is our business.” Anheuser-Busch Brewing Association. www.financialhistory.org31 Financial History ~ Winter 2002 Nationwide Marketing Campaign Besides being the first brewer to suc- cessfully preserve and bottle beer, Busch was also the first to market beer on a grand scale. The nationwide, pro- s e v i motional campaign for Budweiser h c r A e included print and billboard advertis- t a r o p ing and a vast array of novelty items, r o C h such as Anheuser-Busch playing cards, c s u B - r bottle openers, corkscrews, calendars, e s u e h match boxes, pocket knives, post cards, n A e h t and various signs and posters. f o y s On barroom walls across the coun- e t r u o try, a poster of the attractive “Bud- C weiser Girls” became a familiar sight. The famous, panoramic reproduction of the 1876 Little Big Horn massacre, entitled “Custer’s Last Fight,” which Busch commissioned artist F. Otto Becker to paint, was hung on tavern walls from coast to coast. Distributed s s e e v v to over a million saloons, it became i i h h c c r r A A one of the most recognizable paintings e e t t a a r r o o p in the nation. p r r o o C C h To Busch, marketing of bottled h c c s s u u B B - - beer was what made his product r r e e s s u u e e h stand out from all of his competitors. h n n A A e e h h “It is the cream of our business,” he t t f f o o y y s once declared. s e e t t r r u u o o The vast brewing empire that Busch C C had created made him one of the Top: Sponsorship advertisement, “Ken Murray Show,” 1850s. Lower Left: Advertisment, “Life at it’s best,” ca. 1933. nation’s richest men. The young Ger- Lower Right: Advertisement, “Now…a new carton,” ca. 1936. man immigrant who arrived in the U.S. with only a few marks in his A few years later, Carl Conrad, who Budweiser to be bottled and distrib- pocket lived a lavish lifestyle. He had was Busch’s Budweiser partner and uted to beer drinkers way beyond the several homes, including an ornate, also the bottler and distributor for St. Louis area. Millions of people Gothic mansion in St. Louis, a country Anheuser-Busch, went bankrupt. throughout the country were soon estate, two palatial homes in Busch bought out Conrad’s interest popping open bottles of Budweiser. Pasadena, California, a hop farm in and acquired the trademark rights When artificial refrigeration was Cooperstown, New York, two villas in to the beer. introduced in the 1880s, Busch took Langenschwalbach, Germany, and full advantage of this technological also a private railroad car. When he Pasteurization breakthrough. Previously, the brewery died at the age of 75 in 1913, his & Refrigeration stored its inventory in small caves, wealth was estimated at some $60 where the beer was naturally cooled In the days before pasteurization, beer million. Adjusted for inflation, Busch’s for three to four months before it was usually only lasted for a few days.