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Moet Hennessy bid to expand consumer base with vodka brand

Moet Hennessy bid to expand consumer base with vodka brand

Author | exchange4media News Service | Thursday, Jan 27,2005 7:24 AM

Moet Hennessy bid to expand consumer base with vodka brand

Moet Hennessy India Pvt Ltd, part of the French luxury group Louis Vuitton Moet Hennessy (LVMH), which markets imported spirits brands, expects to boost its consumer base in the domestic market with vodka and, perhaps, Scotch whisky brands, in the near future.

Moet Hennessy launched its premium vodka, Belvedere, in India recently. The brand, priced at Rs 2,500 per quart, was introduced in Mumbai and Delhi markets initially, and is now being extended into cities such as Bangalore. The company, hitherto, operated in the premium-to-super premium category of champagnes, cognacs and wines - which are all at best `promising' or developing segments in the domestic alcobev sector.

For instance, the size of the universe for cognacs is about 4,000 cases and champagnes is about 7,000 cases annually with an approximate base of about 60,000 consumers each.

"With vodka, which has a larger market, the company hopes to reach out to a larger consumer base and increased trials," Mr Ashwin Deo, Managing Director of Moet Hennessy India Pvt Ltd, said. However, the steep import levies remain a roadblock even as the premium brands are becoming more mainstream. Belvedere Vodka was the first `luxury vodka' to be launched in the world. It was launched in 1996 and rapidly went on to become a success in the US. Top celebrities associate with this brand now. "Belvedere single-handedly crafted the `luxury vodka' segment and it was with a similar intention that Moet Hennessy launched Belvedere in India recently. The expectation is clearly to address a growing need amongst "discriminating enthusiasts" and offer them a brand of quality, reputation and heritage. Besides, India is a big and growing vodka market which makes the category interesting," Mr Deo added.

The company said it was in no hurry to expand its existing portfolio of brands that include champagnes such as Dom Perignon, Moet & Chandon and Cognacs such as Hennessy VS, Hennessy XO and Hennessy VSOP. The company also has a host of wines, both owned by LVMH - Cludy Bay, Cape Mentelle, Green Point and Terrazas - and others represented through distribution arrangements - Casa Lapostolle, Oxford Landing and Jean Pierre Mouiex.

The domestic wine market, riding the crest of changing tastes and lifestyles, is estimated to be growing between 25 and 30 per cent year-on-year, while categories such as cognacs and champagnes are slowly showing increasing buoyancy in cities such as Chennai, Hyderabad, Kolkata and Pune.

However, LVMH's latest acquisition of Glenmorangie, which marked the group's foray into Scotch whisky market, is significant news for Moet Hennessy's Indian operations. LVMH paid $541 million to snap up the world's sixth largest Scotch producer. "We are awaiting news on it," Mr Deo said, while adding that introduction of a Scotch whisky would certainly enhance the company's reach in the local market. And for LVMH and Glenmorangie, the Asia-Pacific region, with markets such as China and India, are likely to be priority markets as much of Scotch whisky industry's growth has come from this region in recent times.

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