Cognac makers ramp up U.S. efforts as China sips less

Mon Nov 23, 2015 2:52pm EST
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By Martinne Geller

COGNAC, France (Reuters) - France's centuries-old cognac houses are raising their bets on the U.S. market with new products and campaigns to broaden the drink's appeal beyond its African American stronghold.

The big four producers -- LVMH Moet Hennessy, Remy Cointreau, Pernod Ricard and Beam Suntory [BSI.UL] -- have turned more of their attention to the U.S. following a drop in sales in China after an anti-graft campaign.

On its home turf cognac is seen as the drink of choice for mature gentlemen but in the United States it is often enjoyed by status-conscious revelers inspired by blingy bottles and hip-hop name-dropping songs like Busta Rhymes' "Pass the Courvoisier."

Black culture's taste for cognac, which only comes from the area around the western French town of that name, dates back at least to the time when U.S. soldiers were visiting jazz-mad Paris bars during the world wars. Back home it was an alternative to American whiskey, often made in southern states with histories of slavery and racial segregation.

The African American community accounted for nearly two-thirds of all cognac drunk in the world's biggest market, say executives and analysts. Yet that's now changing.

Producers of the drink, made by distilling white wine and aging it in oak barrels for anywhere from two to dozens of years, now need to reach other groups to help fill the space left by China.

"We don't want cognac just to be for one category of person," Remy Martin Executive Director Augustin Depardon told Reuters during a visit to the Cognac region, where over 75,000 hectares of vineyards grow mostly Ugni Blanc grapes that become the building blocks of cognac.

Depardon said a new campaign featuring Hollywood actor Jeremy Renner, one of the stars of The Avengers, was aimed at a broader audience.   Continued...

Bottles and rare samples of Cognac are displayed in a tasting room at the Remy Martin headquarters in Cognac, southwestern France, November 6, 2015.  REUTERS/Regis Duvignau