Jon Potter, Maison Courvoisier, Why Cognac’s Best Years Are Still Ahead

Cognac represents a $4 billion international market. In 2021 roughly 225 million bottles of Cognac had been offered worldwide. That quantity is anticipated to develop at a median of round 3.5% a 12 months by way of 2027.

100 fifteen million bottles had been offered within the US, 37.1 million bottles had been offered in Europe and 34 million bottles had been offered in China. These three markets signify round 82% of worldwide Cognac gross sales.

The US represents about 55% of the worldwide Cognac market by quantity and about 35% by income. Exports to the US are skewed closely towards cheaper VS and VSOP expressions. These two classes signify about 90% of US gross sales. Premium expressions signify the stability.

There are roughly 300 producers of Cognac. The 4 largest producers, Hennessy, Remy, Martell and Courvoisier, nevertheless, signify round 85% of the 8 million, 9-liter instances offered within the US in 2021. That quantity has doubled from simply 4 million, 9-liter instances 5 years in the past. 5 out of each 8 bottles of Cognac offered within the US are from Hennessey.

Cognac gross sales within the US have been rising quicker than the general brandy class. In line with information from the Distilled Spirits Council of the US (DISCUS), in 2016 Cognac represented round 38% of brandy gross sales within the US. By 2021, that quantity had grown to roughly 50% of all brandy gross sales. Throughout that interval brandy gross sales grew from 13 million to 16 million instances, which suggests nearly the complete enhance in gross sales was accounted for by will increase in Cognac shipments.

Worldwide gross sales of Cognac had been up a staggering 31%, by income, in 2021 and up 16% by quantity. This enhance adopted an 11.6% decline in Cognac exports in 2020, on account of pandemic-induced lockdowns of many bars and eating places.

In line with different spirits gross sales developments throughout 2020-2021, the will increase had been extra pronounced for premium and ultra-premium priced merchandise, whereas value-priced merchandise, the kind of Cognac more than likely to be offered at on-premise retailers, lagged.

Just lately, I sat down with Jon Potter, Managing Director of Maison Courvoisier, one of many “big-four” Cognac producers, to speak concerning the state of the Cognac market and, particularly, Courvoisier’s plans for the longer term. Jon has constructed a profitable international enterprise profession over the past 30 years, launching, rising and turning round manufacturers within the UK, Europe, Asia, Africa and North America.

JM: At the moment, you are trying to reposition the Courvoisier model. What’s it about your present market/model posture that you just need to change? How would you like the Courvoisier model to be perceived?

JP: Our model repositioning efforts are actually about rediscovering our timeless spirit. Courvoisier has been an iconic home for the most effective a part of 200 years, served throughout the royal courts of Europe and at legendary moments in historical past such because the opening of the Eiffel tower. The tales, characters, symbols, and naturally blends are excellent. Our renewed efforts are about utilizing these property, and the spirit of joie de vivre that runs by way of the home, to reclaim our place as a worldwide icon.

JM: The US is Cognac’s largest market, absorbing round 55% of Cognac’s exports. Solely round one in ten shoppers of alcohol, nevertheless, drink Cognac. Inside the US, gross sales, traditionally, have skewed closely towards younger African American males, though Millennials, on the whole, have gotten extra enthusiastic Cognac shoppers. How do you develop the buyer base of Cognac within the US, particularly to Millennials and particularly to Millennial girls?

JP: We expect we will open shoppers’ minds by showcasing cognac in new events. Shoppers, and the business, can typically have a myopic view about how and when to drink Cognac. We see a possibility for extra discovery of Cognac in cocktails, whether or not in bars/eating places or at dwelling. It’s an extremely versatile and mixable spirit, effectively suited to the worldwide progress of cocktail tradition and sociable ingesting events. By showcasing the product in these lighter and brighter moments we will upend preconceptions about Cognac.

JM: On a worldwide foundation, the Cognac business was initially hit arduous by the COVID pandemic however has bounced sharply larger within the final 12 months. What’s driving that pattern and is it sustainable? Was the preliminary downturn a sign that Cognac gross sales skewed closely towards on-premise cocktail gross sales? Is Cognac turning into extra of an off-premise/dwelling drink? What does this pattern imply for the way forward for the Cognac business within the US?

JP: Taking a step again, Cognac has been and continues to be resilient. The class has nearly doubled in worth within the final decade. It has a observe file of progress that we see persevering with sooner or later. Cognac has lengthy been sturdy within the off-premise, with in fact very strong on-premise enterprise. What we noticed through the pandemic was maybe extra a mirrored image of the volatility of the scenario. We anticipate to see continued energy within the off-premise however are excited to see our companions within the on-premise be capable to welcome visitors once more. This channel will proceed to play a vital position in permitting shoppers to find and expertise Cognac in new methods.

JM: Lots of the bigger Cognac manufacturers have intently related themselves with city tradition and its main musicians. Courvoisier has additionally reached out to the African American neighborhood however by way of business-oriented philanthropy fairly than city tradition. What drove that technique and is it working?

JP: Maison Courvoisier was based by Felix Courvoisier in 1828, who created a home that was welcoming to all and believed in supporting the close-knit neighborhood of artisans in our hometown of Jarnac, France. We launched Basis 1828 to rejoice that spirit of entrepreneurship by way of significant monetary and academic help that empowers small enterprise house owners and entrepreneurs in underserved populations throughout the globe.

Although Courvoisier has supported entrepreneurs all through our historical past, our first formal initiative took the type of a $1 million monetary dedication over 5 years to help Black and minority small enterprise house owners and entrepreneurs within the US dealing with hardships on account of the pandemic.

We all know entrepreneurs are available in many alternative types, from all walks of life and ranging earnings ranges, and we need to nurture that drive, ardour and creativity, as we help these communities that help us across the globe. It’s necessary to us to pay attention to those communities and help them long-term.

Moreover, this 12 months we welcomed British-Nigerian designer Yinka Ilori as our “Ambassador of Pleasure” – a task created completely for the colourful storyteller. Yinka, together with actress Rashida Jones, jazz musician Moses Boyd, and vogue and photographer Betina du Toit, introduced “We Discovered Pleasure,” a totally immersive occasion sequence impressed by the great thing about summer time in our dwelling of Jarnac, France to life.

The multi-sensory expertise kicked off in NYC in March. The worldwide expertise additionally shared their interpretation of pleasure in a content material sequence titled “Welcome to Maison Courvoisier” which is featured on Courvoisier.com and our social channels.

JM: All the key Cognac firms, apart from Martell, noticed a big bounce in gross sales over the past 12 months. Hennessey and Remy led the way in which with the largest will increase adopted by Courvoisier in third place. Why did you lag and the way do you propose to deal with that?

JP: Courvoisier’s enterprise has largely adopted class developments; nevertheless, the continued progress of the class has created alternative and ambition for the model. Regardless of category-wide provide and covid challenges, we have now been in a position to defend our market place as we put together for the brand new packaging. Class progress is nice for us, as we get the prospect to win over increasingly more shoppers.

JM: The Asian market has been an enormous driver of Cognac gross sales, particularly for premium expressions. That market seems to be slowing down. Is that this only a momentary correction? How will the business take care of a slowdown in Asian demand, particularly for premium-priced expressions?

JP: The pandemic has definitely had a deeper influence on our enterprise in markets that skilled, and proceed to expertise, longer and extra restrictive shutdowns, akin to China. Nonetheless, declaring this a long-term pattern could be hasty. We nonetheless see a powerful alternative for progress in Asia, particularly inside our status vary of Cognacs.

JM: The selecting season in Cognac has been getting more and more earlier. On the similar time, late spring frosts appear to be each extra extreme and extra prevalent. Whatever the causes, how will the business address these developments? Can Ugni blanc address each late frosts and early selecting? Is there a degree the place altering local weather situations would require a rethinking of the grape varietals utilized in Cognac?

JP: We’re very conscious and are monitoring the local weather adjustments. We’re a number of grape varietals that may face this problem and keep the prime quality of our Eaux de vies. For Ugni blanc, we’re additionally a late pruning of the vines, particularly for the younger ones. For the early selecting, we adapt the time by harvesting at night time, shortening the time earlier than fermentation and cooling the should.

JM: There was a rising curiosity in Cognacs produced from historic varietals like Colombard and Folle Blanche. Courvoisier’s Cognac manufacturing is all primarily based at Ugni blanc. Do you see Courvoisier providing Cognac expressions from historic varietals sooner or later?

JP: We’d by no means say it’s out of the query, but it surely at the moment isn’t in our plans.

JM: Thanks.