I can still hear the
collective gasps filling the cavernous conference room by the end of my keynote
presentation in this year's Champagne Assembly in London. The attendees, an
eclectic mix of brand ambassadors, journalists and aficionados largely agreed with
Euromonitor's findings. Champagne had historically not only provided a rather
accurate mirror image of the prevailing macroeconomic environment, the category
actually appeared to precede the boom and bust cycles – a fact making it the
proverbial canary in the coalmine, raising the alarm before an upcoming
The conference took place in
March 2012. Incidentally, Champagne's slowing performance in the UK in 2011
already underlined the heightened probability of the dreaded double dip
scenario. This particular forecast would materialise a couple of months later.
The audience also seemed to
support the suggestions that rose varietals, growers' offerings, and vintage
launches will increasingly inform the industry's future direction, while
quietly acknowledging other sparkling wine's cannibalising ascend and the
rising threat of its aggressive competition.
It was the last slide that did
it. Looking at the list of the markets expected to post the strongest actual
gains in total champagne volumes over 2011-2016, most of the usual suspects
were there. Within that context, there is little surprise that France leads the
pack, the UK is well up the table, and the booming growth nations of Brazil and
China are present, alongside the US powerhouse and the defiantly buoyant
However, what did come as a
surprise was Nigeria's second place in these global rankings, and the
audience's disbelief was palpable. No-one challenged the data directly and yet
many seemed to politely take it with a grain of salt – if only in the light of
the dominant, overoptimistic analytical perspective that sees the European
debt-crisis saga coming to a happy ending by the end of 2012. Why bother with
Nigeria anyway if Europe was about to start popping bottles again in the
It did not. By September 2012,
Western Europe, champagne' de facto bastion, is still struggling with debt,
austerity, unemployment and existential questions. In France, heavy rain,
destructive hail storms, late frosts and vine disease have lead to the smallest
harvest in 20 years according to the CIVC. Production costs and grape prices
are stratospherically higher while price hikes in western markets are out of
the question. The UK is officially deeper into double dip territory.
And Charles Armand de Belenet
–Global Marketing and Communications director at Pernod's GH Mumm and Perrier
Jouet Champagne brands – said that “Nigerian Champagne consumption is quite big
'' adding that “we are building our network here and it is one of the most
attractive places for us at the moment”. The moment is finally here.
baths and apps
According to Euromonitor
International, global champagne sales are set to register 2% total volume
growth in 2012. Nevertheless, such a growth rate – as uninspiring as it might
look- is actually much closer to reality than the seemingly booming shipment
figures paraded around the press by the PR departments of key champagne houses.
And it gets worse.
Considering the deteriorating
operating environments across the European periphery and the emerging cracks,
even within the once unyielding Eurozone core, ostentatious consumption appears
to be increasingly out of synch with the zeitgeist – not exactly good news for a
category that is generically identified with luxury.
On the other hand, innovation
remains limited. Beyond the short-sighted, counterproductive, essentially
devaluing and eventually backfiring champagne baths that recently re-emerged as
a fad with a distinctly bad timing, artist collaborations dominate new
launches. While David Lynch's signature does provide some artistic kudos to Dom
Perignon with their recent collaboration, it is GH Mum's I-Phone App “on how to
be a gentleman with champagne” that really strike a chord.
At the end of the day, a fresh
focus on a stronger social media presence along with a more forward looking and
groundbreaking approach to new product launches are the only routes available
for the champagne industry in mature and financially volatile European markets.
Beyond that, avoiding generic, unimaginative and half-hearted innovation
ventures in the west while entering the BRICs as well as second tier emerging
markets should not be viewed as a surprise anymore. It is now a necessity.