Why Heineken Stock Was so Frothy Today

Source Motley_fool

In the middle of the current work week, investors were eager to take a few swigs of brewery stock Heineken (OTC: HEINY). They were most likely encouraged by the company's announcement of a potentially very high-profile co-marketing deal with an upcoming blockbuster Hollywood film, as they pushed the company's stock 4% higher on Wednesday.

Pitt stop

Heineken announced that its Heineken 0.0 non-alcoholic beer is an official partner of F1: The Movie, a high-budget spectacular produced by Apple's film unit and distributed by Warner Bros. Discovery. The movie, starring Brad Pitt as a veteran Formula One driver, is slated for U.S. release on Friday, June 27.

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People seated at a table drinking beer.

Image source: Getty Images.

As part of the collaboration between brewer and movie, Heineken 0.0 will be prominently featured in a TV ad campaign; the spot released by the company showed co-star Damson Idris consuming the drink. Pitt appears in something of a supporting role in the ad. The beverage will also likely be product-placed within the film.

Heineken didn't hesitate to point out that its involvement with F1-themed material is part of a longer-tail strategy. In the press release touting the current partnership it said that it has been a sponsor of the elite motorsport since 2016.

Since F1: The Movie centers around extremely fast vehicles, it would be awkward to advertise the Netherlands-based company's foundational alcohol-packed beer. Instead, the company is tying into the racing world by stressing the merits of moderation.

The right Formula

To that end, Heineken quoted its global head of brand Nabil Nasser as saying that "This partnership isn't just about visibility -- it's about making alcohol-free choices feel natural, accepted and relevant in the moments that matter, especially in social settings."

It doesn't hurt that this is occurring with a film that stands a good chance of attracting a large and wide audience. Formula One is a universally followed sport, so it's a wise choice of marketing partner for an international brand like Heineken.

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Eric Volkman has positions in Apple. The Motley Fool has positions in and recommends Apple and Warner Bros. Discovery. The Motley Fool has a disclosure policy.

Disclaimer: For information purposes only. Past performance is not indicative of future results.
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