SB Interviews… Christian Porta

10th September, 2012 by Richard Woodard
Chivas Regal 18

Porta claims Chivas Regal was a ‘neglected brand’ under Seagram in the ’90s

This renewed focus has been boosted, Porta adds, by a beefing up of the company’s presence in the key spirits markets of Mexico and Brazil, where local subsidiaries Casa Pedro Domecq and Pernod Ricard Brasil respectively have become “much more professional” than in the past.

Besides, he points out, the company is “not starting from scratch” in the region and already sells more than 100,000 cases of Chivas Regal in both Brazil and Mexico, with good growth continuing.

Further down the price chain, Passport is now selling more than 1m cases a year, with Latin America the brand’s heartland. But its larger Diageo rival, Buchanan’s, is about 500,000 cases ahead of that, and has used its success in the south to tap into the Hispanic consumer opportunity in the US, becoming North America’s fastest-growing Scotch in the process. Could Passport follow suit?

Porta isn’t so sure. “The premium/standard Scotch market in the US is not a very dynamic market currently,” he says. “There are more losers than winners in that market. Super-premium blends and super-premium malts – that’s where the dynamic growth and the profitable growth is.”

But even Chivas Regal, given its dramatic growth in China and generally strong performance elsewhere, has had a surprisingly chequered performance Stateside.

“Chivas Regal has had a more difficult history in the US,” agrees Porta. “It was basically a neglected brand with Seagram in the ’90s, and it has taken time and effort to find a solution.

“Three years ago, we decided to invest more and go back to the basics of building a super-premium Scotch whisky like Chivas. For the last year, we are now stable-plus with very good growth for Chivas 18 and stable for 12. The brand now is in a small growth pattern and we want to continue that.”

Nonetheless, the story of Chivas Regal illustrates how the global opportunity for Scotch has diversified beyond the historic mainstays of the US and Europe. At one point, the brand sold 500,000 out of 2.8m cases in the US; now the figures are 400,000 and 4.9m respectively. Times have changed.

Much of the reason for that transformation – in Chivas Regal’s case especially – is to be found in China. But that market too is evolving, following the dynamic growth of 2002 to 2008, then a slowdown as the world’s economies dipped. As China matures, will the super-premium focus of the market develop to include cheaper blends as well?

“No, for the time being China is a fantastic market which starts with Chivas, Ballantine’s 12 and Johnnie Walker Black Label,” replies Porta. “We see this continuing to happen and we are very optimistic.”

Instead, he says, the evolution of Scotch whisky in China is much more about diversifying when it’s consumed, switching from whisky’s traditional place in bars and clubs towards drinking with food and, in the longer term, at home.

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