A NEW STEP IN THE VALUE STRATEGY
THE FOUR STRATEGIC LEVERS
Introduction
The transformation of Rémy Cointreau’s business model since 2015 (acceleration of the upgrading of the brand portfolio towards the high-end and implementing a customer-centric culture) has clearly brought results. Between 2015 and 2019, the Group delivered average organic growth in sales of 7% per annum and its current operating margin rose by 4.4 points over the period.
Since December 2019 the Group has moved on to a new step in its value strategy, which consists in optimising its portfolio strategy to build a more sustainable, profitable and responsible business model. Because such an in-depth transformation takes time, the Group has set its targets at 2030. This time frame is also consistent with the Group’s mindset and raw material procurement planning for some of its brands, such as Rémy Martin XO.
01
Enhancing the value per case of our spirits
The "portfolio strategy" consists in assigning a role to each Group brand to maximise the Group’s value per case and gross margin. The priority for the most profitable brands will thus be to step-up their growth (driven by increased investments), while the less profitable will have profitability improvement targets (by gradually refocusing them on their high-end products).
By increasing its gross margin, the Group will expand its investment capacity behind its priority brands, thus creating a virtuous circle of more sustainable and profitable growth.
02
Moving from a "client-centric culture" to a "client-centric business model"
During the past five financial years, the Group has installed a culture focused firmly on the end customer by establishing direct and personalised relationships through human, media and digital investments to enhance brand appeal.
The Group is now seeking to move on to the next step by implementing a genuine client-centric business model. This should translate into a significant increase in the Group’s direct sales, whether through digital, own stores or its network of "Private Client Directors". To do this, it must implement or strengthen the tools that will enable it to communicate with, educate, retain and sell directly to its clients.
03
Accelerating the development of the Liqueurs & Spirits priority brands
The Liqueurs & Spirits portfolio has significant untapped growth prospects due to the fact that its brands are far from their full potential in their existing markets, in particular in terms of retail penetration.
Some brands have accordingly been identified as priority drivers of profitable growth. The expected mix and scale effects should gradually result in improving division’s profitability, despite reinvestments in brand communication and education.
04
The "Sustainable Exception" plan for more responsible growth
Having defined its values (Terroirs, People, Time and Exception) in 2016, the Group is now seeking to reflect them through a responsible growth plan. The key concerns of the "Sustainable Exception" plan are ecological agriculture in all terroirs involved in crafting the Group’s spirits, eco-design for all the brands’ packaging and a gradual reduction of carbon emissions aligned with the international ambition of "Net Zero Carbon" by 2050.
As a family-owned Group, Rémy Cointreau is all about people and respect for the men and women whose know-how and commitment contribute to the success of the Group and its strategy. Its ambition is to become even more inclusive, whether in terms of the representation of women, ethnic diversity or age within the decision-making bodies. Lastly, thanks to its positioning in the exceptional spirits market, the Group is fully aware of its duty to set an example regarding responsible consumption. Accordingly, the Group promotes occasional consumption to celebrate exceptional moments, with moderation.