Cognac: China Calls Time

03 January, 2014

Staged in New York, it celebrated Louis Royer’s Force 53 VSOP Cognac, one of the highest proof Cognacs on the US market, and a brand that has helped “to ignite” the overproof cocktail trend. “This year’s competition was particularly intense and I salute the winners for their ingenuity, finesse and genuine respect for Louis Royer ‘Force 53’ VSOP Cognac,” says Jérôme Royer, master selector, Louis Royer Cognac and a competition judge. “We are delighted that American bartenders have taken to Force 53 and are creating amazing cocktails with it that can be enjoyed year-round, as the competition clearly demonstrated.”

Marketing strategy

The Cognac house sees this competition as an important part of its marketing strategy and a way to communicate with both trade and consumer, and when it comes to communication Courvoisier is preparing to break new ground in Europe and beyond with its Here’s to Now multi-media campaign which is being rolled out initially in the UK where the brand is the number one. The campaign includes online and print advertising as well as integrated partnerships, and event sponsorships.

The aim of the push which, aside from Europe will also take in the Middle East and Africa, is to establish Courvoisier as a way of life and to get consumers to act spontaneously as print ads demonstrate with the copyline: “It might not be the right place, but it’s definitely the right time and what better time than now?”  

This is a tough call as, with its  luxury positioning, Cognac is traditionally associated as a “special occasion” drink in most markets – though happily this is not the case in Scandinavia, which is prime region for the producer Bache-Gabrielsen. 

  “Norwegians love Cognac and Cognac is part of their everyday life. Cognac is not a luxury product in Scandinavia, which is good as it is less subject to ups and downs,” says Herve Bache-Gabrielsen, general manager, sales and marketing. 

The company has the best of both worlds, as its limited-edition and vintage Cognac releases have had “very nice feedback” from its customers across Scandinavia. “These satisfy the demand from Cognac connoisseurs for more exclusive products.”

With Altia – the Finnish state-owned company – acquiring Larsen from Rémy Martin in June this year it will be interesting to see if competition increases across the region. But Bache-Gabrielsen is undaunted. “No doubt Altia has some ambitions for the Larsen brand in Scandinavia, but it will take some time to implement its operations,” he says. “They have a large volume of Cognac to source in order to be able to maintain the position of their brands, Renault, Larsen and Gronstedts, and some markets are quite price sensitive.”

 Outside Scandinavia Bache-Garbrielsen has “been able to maintain its turnover by a mix of activity” in emerging markets such as China and Russia. Asia now accounts for 18% of its turnover and there was “strong growth” in both China and Vietnam in 2012. This year to date the company has consolidated these gains but growth has been slower. However thanks to “a significant business deal” Bache-Gabrielsen is optimistic when it comes to the US. 

Clearly Cognac producers are bracing themselves for a significant downturn in China which will affect the higher qualities – a trend which is already evident. Having said that, this decline could well moderate prices when it comes to Cognac supply, which will enable companies such as Bache-Gabrielsen, to improve volumes over the next year. 

But producers who have put all their efforts into China’s egg basket will not have an easy ride – indeed some companies are predicting a significant fall-out. 





Comment

Joe Bates

Why craft brands are gaining traction

I’ve always maintained that the cards are stacked against craft spirits brands wanting to build a meaningful travel retail presence.

Click for more »

Events

Facebook

Twitter