Despite the closure of on-trade establishments (bars, restaurants, nightclubs, etc.), the US spirits market was buoyant in 2020/21, bolstered by the acceleration of a few promising trends brought on by the pandemic.
Firstly, the move upmarket continued to gain momentum, while consumers seek out authenticity and provenance. Although most of the portfolio benefited from this trend, Rémy Martin 1738 and Rémy Martin VSOP cognacs recorded particularly spectacular growth rates through the recruitment of new consumers.
In addition, the boom in home consumption over the past 12 months was underpinned by years of investment in cocktail culture by brands like Cointreau and The Botanist. Takeaway cocktails delivered to customers by bars and restaurants also made high-end mixology at home more accessible. Lastly, Cointreau partnered with Independent Restaurant Coalition to raise consumers’ awareness of the challenges facing the hospitality sector with its first ever TV campaign during the annual Superbowl event.
E-commerce is the fastest growing distribution channel in the United States, and the Group’s brands have benefited greatly from this momentum. Louis XIII and Westland even launched their own websites in collaboration with Reserve Bar.
In Canada, at-home consumption also helped offset the closure of on-trade establishments. In contrast, Latin America was adversely affected by the suspension of tourism and travel.
In order to reduce its environmental impact, the region restricted gift boxes to limited editions and special occasions. As a result, only 20% of the volumes are now packaged in boxes, compared to 30% previously.
The region looks ahead to 2021/2022 with confidence. The above trends are expected to continue to drive the Group’s growth.
The Asia-Pacific region as a whole has suffered from the Covid-19 pandemic, hit hard by its dependence on tourism and on-site consumption. Two markets within the region nevertheless recorded a surprisingly remarkable performance: Greater China and Australia.
In Greater China, the shutdown of on-trade establishments (bars, restaurants, karaoke bars, etc.) set the year off to a slow start, but their reopening in the summer of 2020 pushed cognac and whisky consumption to new heights during the rest of the year. Moreover, many initiatives were taken to meet the increasingly demanding expectations of Chinese consumers in terms of brand experience. An immersive presentation of the Rémy Martin House was organised at the Guangzhou Opera House and enjoyed tremendous success. Louis XIII broadened the level of experience offered to its customers through unprecedented cultural events: Heritage Awakening cultural round tables, a poetic experience at the Shenzhen Sky Concert Hall – the highest music hall in the world – and an artistic Symphony of Time concert in Shanghai. We stepped up the quality of customer relations with the launch of concierge services for Louis XIII VIP customers, together with a mini WeChat programme dedicated to Rémy Martin customers. Lastly, hundreds of live streaming sessions were held on social networks for the new generation of connoisseurs.
Australia saw a huge increase in retail sales. The rise of at-home cocktails was especially beneficial for Cointreau; buoyed by significant media investments, it has become the third most valuable brand in the liqueur category. The Botanist also stood out, while cognacs showed resilience.
The region has an optimistic outlook for the year 2021/2022. With buoyant domestic consumption, prospects in Greater China are excellent, while other markets should benefit at least partially from a recovery in tourism and the reopening of the hospitality sector.
