Camus, long-time innovator, untaps the Spirit of China: Kings of Wines, Wines for Kings – 01/08/05

CHINA. Cyril Camus is in ebulllient mood as he speaks about Spirit of China, his company’s latest and much-talked about travel retail project. It’s one he feels a deep personal empathy with – his wife Isabel is Chinese and he is fluent in Mandarin.

The youthful fifth-generation President of one of Cognac’s most famous houses, Camus, believes that the concept is the right product at the right time. And he insists that it can become a major success story for airport retailers worldwide seeking to service the extraordinary 21st century wave of outbound Chinese travellers.

Spirit of China is a neatly symbolic and literal banner for a trio of Chinese liquor brands being showcased to the world. “All these brands are national brands and national icons,” enthuses Camus. “They’re all amazing brands – the best of China.”

The lines are Guizhou Moutai (small batch blend), a product with a heritage dating back 2,000 years to the Emperor Hanwu; Gu Yue Long Shan (Hua Diao Reserve), a Chinese Yellow wine from Shaoxing City, the cradle of rice wine production with a 2,400-year tradition; and Chunghwa Cognac, a “˜baby’ alongside its venerable peers, born out of a marriage of Camus Cognac from France’s most famous grape brandy region and the brand name of China’s leading premier cigarettes.

Spirit of China brings the three lines together under a single marketing concept but with two audiences in mind – those seeking quality destination merchandise from China and Chinese travellers themselves.

Previously, efforts to sell and promote China’s wines and spirits have been hampered by problems such as pricing anomalies and range limitation. But here Camus has convinced three of China’s top producers to throw their full weight and commitment behind the concept. “The producers plan to use duty free as a window to develop their brands,’ he says.

Camus has developed an integrated marketing campaign, including a dedicated merchandising unit – the Spirit of China corner. The modular design makes it simple and adaptable for different retail layouts and by marrying a contemporary feel with traditional merchandise, Cyril Camus says retailers will be able to captivate Chinese travellers seeking the assurance of established brand names.

He points out that one of the reasons for the low penetration rate for Chinese travellers in terms of the liquor category (15% compared to an estimated 30% for tobacco) is that so many of them are first-time travellers. “They need to learn about duty free,” he adds. “I believe they are not comfortable in the current environment.”

That’s down to a combination of reasons, including the international naivety of many Chinese travellers. But until now there appears to have been little concerted effort to nurture their spend or add value. Chinese brand owners have tended to simply offer their domestic market references in the duty free channel. But flawed price structures and the fact that Chinese companies have not been focused on serving the duty free channel’s needs have hindered development.

Camus’ approach was simple but ingenious. “We figured we could put together a range of Chinese brands and simplify the package so that any Chinese traveller going through a duty free store would say this is for him or her – when it comes to liquor, it’s the Chinese brands that matter to the Chinese traveller,” says Cyril Camus. “Additionally we could help international travellers find Chinese products.”

He describes Spirit of China as a targeting of “the greatest opportunity yet for duty free”, saying that there will be an estimated 50 million Chinese traveling by 2010. As reported previously, Chunghwa Cognac has already been launched as a standalone brand via DFS Group, which holds the worldwide duty free rights to the famous cigarette brand’s first foray into liquor (though DFS will allow Camus to distribute the brand to selected other duty free retailers). The Chunghwa tobacco brand is owned by the Shanghai Tobacco Group and Camus is the manufacturer and worldwide distributor. For Guizhou Moutai and Gu Yue Long Shan Camus is the exclusive duty free distributor outside China.

Camus has worked closely with all three producers, lending an international expertise but maintaining the integrity of the original brands. In travel retail Guizhou Moutai and Gu Yue Long Shan are offered as a premium version of the domestic market reference – and the three, including Chunghwa, will always be offered as a collection.

“It wouldn’t work [as individual brands,” says Camus, “you have to put it in store as a luxury environment for it to work.”

Few drinks companies know the dynamics of such an approach better than Camus. Ever since its well-documented relationship with DFS Group (then Duty Free Shoppers) was forged in the 1960s, the company has been rightly regarded as one of travel retail’s most innovative suppliers, invariably representing the advance guard of change in the liquor category.

It was Camus which sparked the so-called “˜new generation’ Cognacs of the 1990s, targeted at Japanese “˜office ladies’, with the phenomenally-successful Joséphine pour Femmes. Imitations followed by the shipment full but none matched the success of the original. Now the family-owned house hopes to have struck liquid gold again with a concept that appears to have been delivered with optimum timing.

“We saw the travelling Chinese phenomenon was really happening and yet we could also see that as an industry we weren’t really doing something about it,” Cyril Camus recalls.

That all changed with February’s launch of Chunghwa XO, which aspired to align the Chinese partiality for brandy with the fame of the cigarette brand.

Now one has become three. And the trio’s individual and collective allure will be emphasised by the elegant merchandising unit and point of sale material that emphasises the traditions and cultures of China as well as bringing what Camus describes as a “contemporary twist”.

“We have made a commitment to all of our partners to develop these brands internationally and we’re serious about that,” says Camus. “These are great Chinese brands that have effectively not been out of China, yet one of them sells eight million cases!

“We are simplifying the process for our retail partners and the brands that we represent – we don’t see it as a way to sell more Camus to Chinese travellers.” Camus itself will get the benefit further down the line – “the advantage for us is that Camus is the preferred partner of the best brands, so that must be good for us.”

With his deep-set Chinese knowledge and connections, Cyril Camus confesses to a real passion for the project. “I have a great feeling of pride,” he says. “It’s very flattering to be entrusted with such great brands.”

Spirit of China factfile:

Gu Yue Long Shan is manufactured by the Zhejiang Yellow Rice Wine Group – the largest producer of Rice Wine in China. The company sells over eight million cases a year, mostly under the Gu Yue Long Shan (Dragon Mountain of the Kingdom of Yue) brand. It is committed to a long-term plan for developing its volumes and its premium positioning, both domestically and internationally. Approximate duty free price: US$55

Target markets:
– PRC Chinese and overseas Chinese – gift and self-consumption
– Japanese and western travellers – souvenir and gift
– Men and women with a slight bias towards women

Moutai is an icon of China and the Guizhou Moutai Group is described by Camus as “China’s most emblematic liquor company”. The company enjoys a quasi-monopoly on the production of the region’s famous spirit.

The Moutai brand is a controlled appellation and sells more than one million cases a year. It is considered China’s most prestigious and symbolic spirit and is the official liquor at state banquets. Exclusive to duty free. Approximate duty free price: US$65

Target market:
– PRC Chinese and overseas Chinese – gift and self-consumption
– Japanese and western travellers – souvenir and gift
– South Korean and Russian travellers – self-consumption
– Mostly men

Chunghwa XO Cognac is a marriage between a great Chinese cigarette brand name and a Cognac from the leading family-run Cognac house. Exclusive to duty free until end of 2005. Approximate duty free price: US$125 (70cl decanter)

Target market:
– PRC Chinese and overseas Chinese – gift and self-consumption
– Japanese and western travellers – souvenir
– Mostly men

MORE STORIES ON CAMUS

Camus unveils “˜Spirit of China’ in pioneering industry effort to serve the Chinese traveler – 17/05/05

Former Hennessy and Gallo executive Michael Beamish joins Camus in key Asia Pacific role – 12/05/05

Camus launches Chunghwa Cognac via DFS; hot cigarette line extension listed in Singapore – 08/02/05

Richard Ferne joins Camus in senior Asia post – 22/12/04