Major cognac makers turn to Vietnam, Taiwan and Russia following success expanding into China; 2010 saw an 8.5% increase in worldwide cognac consumption, including a 34% increase in Asian volumes
September 29, 2011
– Following a two-year decline, 2010 saw an 8.5% upturn in cognac consumption, as Asian exports grew volumes more than 34%. Analysts believe exporting to a wider base will protect the category during future downturns, Reuters reported Sept. 23.
The No. 1 cognac maker Hennessy – owned 66% by luxury goods group LVMH and 34% by spirits maker Diageo – said Vietnam, Taiwan, Malaysia, Cambodia and Laos are coming into view after all eyes had been set on China. Hennessy's international director Andre de Bausset expressed the industry’s interest in expanding into several markets rather than relying on a single country, recalling industry-wide losses when Japan took a big hit in 1992.
Pernod Ricard’s Martell is turning its attention to Eastern Europe, particularly Russia and Ukraine, where the spirits maker has seen growth of over 10%. China is the company’s largest market, the publication reported.
Remy Martin, the world’s second-largest cognac maker, is also interested in Asian countries besides China, its top sales market. CEO Patrick Piana said Remy has its eyes on Vietnam, which is growing by double digits, India, where the company last year opened a subsidiary, and Singapore.
Courvoisier, whose entry to emerging markets has come later than the other major cognac houses, has witnessed growth of more than 20% in China and Russia. The company has also done well in Vietnam, where it has revived “the old French connection with the area," said president Patrice Pinet. Seventy percent of the company’s volume goes to the U.S. and UK.
The primary source of this article is Reuters, London, England, on Sept. 23, 2011.