Can anyone break the Big Four’s Cognac grip?

9th July, 2012 by Richard Woodard

Booming sales in China, a mature but strong market in the US offset by stagnant or slowly declining markets in Europe – that’s the global picture for Cognac at the end of 2011, as the figures of the Bureau National Interprofessionnel du Cognac (BNIC) illustrate.

Cognac barrel

Smaller Cognac houses are finding their own place in the market that’s dominated by the Big Four

China has been on fire for some years now, driven by sales of aged, expensive, high margin Cognac. This neatly complements the VS-reliant but still huge US market, and that neatness isn’t lost on the Cognaçais.

“Total shipments have been increasing significantly, in terms of volume and value,” points out Agnes Aubin, director of communications at the BNIC. “We have gone from a concentration of exports to a few countries to a balanced spread through three continents, which is a very good sign for Cognac’s future.”

It’s a view echoed by many in the region, including Rémy Martin CEO Patrick Piana. But when we talk about Cognac’s global markets – and especially when we discuss the dynamic growth in the emerging markets of Asia – we’re talking for the most part about four brands: Hennessy, Martell, Rémy Martin and  Courvoisier.

These multinational-owned powerhouses gobble up well over 80% of the total value in the Cognac sector, and more than 75% of volume, making it entirely understandable that all the media talk focuses on Martell’s surge in China, Hennessy’s dominance in the US, Courvoisier’s perceived over-reliance on Western Europe and Rémy Martin’s success with Louis XIII.

But what about the many other houses that dot the map of Cognac and which, without ever being able to match the marketing budgets of their enormous rivals, aim to carve out their own special niche in this golden age for one of France’s most successful spirits?

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