Johannesburg - Hennessy Cognac chief executive Bernard Peillon was this week pleasantly surprised that South Africa has its own unique way to embrace the drink.
“Yesterday, I was introduced to a typical South African way of drinking my Hennessy. It was with Appletiser and ice and it was extremely refreshing. I really enjoyed it through the evening with my dinner. It was a great way to do it,” he said.
Peillon sees his mission as being to allow every customer in each one of the 120 countries in which cognac is a household name to have its own way of expressing its acceptance.
This dovetails with his philosophy that “there is only one way to drink Hennessy, and that is your way”.
From cranberry juice or ginger ale in the US, Hennessy’s biggest market, to ice-cold pitchers of green tea in Asia, a fast-growing opportunity market, Peillon finds it gratifying that each country builds its own culture around the drink.
“When you manage a 250-year old company, there are many ideas to it but you need to balance short-term decision making with long-term vision because everything you do is in perspective of 250 years.
“My responsibility is to prepare the future and make the brand stronger,” Peillon told Business Report this week as part of his visit to South Africa to celebrate the brand’s 250th anniversary.
South Africa is an important market in Hennessy’s books and is likely to see double-digit growth despite a subdued economic environment.
Peillon said for Hennessy, the past 20 years had been a constant boom and had grown significantly in a market totally dominated by the scotch industry but which has attained such brand equity that LVMH Moët Hennessy Louis Vuitton, the parent company, sees the country as being the sixth-largest market for Hennessy on the worldwide basis.
Hennessy estimates that roughly 80 000 to 100 000 12-bottle cases of cognac are imported into South Africa each year, with Hennessy accounting for 75 percent to 80 percent of that total.
Cognac bureau figures reveal that 13 million cases of cognac are sold each year. With 12 bottles per case, this amounts to 156 million bottles.
According to LVMH, Hennessy sells 70 million bottles of cognac each year, making it larger than the next three players combined.
In South Africa, Hennessy has partnered with RGBC, which also markets and distributes the likes of Jack Daniels, Southern Comfort and Glenmorangie.
Peillon said South Africa’s emerging middle class and young entrepreneurs presented the wide spectrum of opportunities that Hennessy intended to build into a bigger market and also the launch pad into the rest of Africa’s affluent.
South Africa, along with the rest of the world, is offering Hennessy a new class of consumer, ladies, over which the company has sat and mulled over ways of permanently winning over, but, Peillon says, the price may be too high.
“In my experience, whenever people make those moves they might have a quick win on a subject but the question is are you losing your soul, are you losing your identity in such a way that you have diluted your brand equity that people no longer understand what you stand for.
“You need to, in a world where you have so many brands, so much competition, to be extremely clear to your customers of what you stand for as your sanctity and as we see the way people relate to brands, no matter what they want there can be other brands but they are looking at your roots, your sanctity, your craftsmanship what makes those brands special, what distinguish them from each other.
“It’s a game we can play sticking at what we are good at, some other producers are proposing flavoured versions of their spirits but I think it is not proper for us, not because we are snobbish about it but I think we need to stand true to who we are,” Peillon said.
Business Report