Laurent Reinteau – Keep it simple

Since taking over at Champagne Jacquart, Laurent Reinteau has focused on streamlining the brand and increasing value in key markets. And he’s been quick about it

COMING FROM the mighty, upmarket and yellow-daubed house of Veuve Clicquot, Laurent Reinteau, managing director of Jacquart since summertime 2009, doubtless knows a thing or two about building brands, and his move – almost across the street – to the latter label’s newly restored 18th century headquarters in Reims, says as much about Jacquart’s ambitions as it does about Reinteau’s belief in its potential. Speaking at the London International Wine Fair, it’s certainly clear that Reinteau, who comes with 15 years’ experience with the famous fizz, preceded by a brief stint in Bordeaux as a student, has no doubt about what direction his new label should take. Not only that, he has wasted no time in implementing a strategy.

In the short period he has headed Jacquart, Reinteau has already overseen an acquisition, a major agency change, a winemaker appointment and a total repackage – complete with a range revision. It’s been a swift but seemingly smooth shift in gears for the house, all with the intention of taking Jacquart upwards in terms of image and price.

Looking back, Reinteau, who is an engaging and seemingly gentle personality with perfect English, reminds that his first major task was handling the acquisition of Montaudon Champagne, which Moët Hennessy had bought in December 2008, stripped off its land and contracts, before selling the name to Alliance Champagne, Jacquart’s parent company (see box, next page), just before Christmas last year.

While LVMH wanted the vineyards, Alliance, with access to 2,400 hectares of Champagne – which accounts for 7% of the entire region – didn’t need the grapes. On the other hand, it did want a new name, primarily to take some of the promotional burden off Jacquart’s shoulders: within the Alliance group, Montaudon could be used to shift volume, allowing Jacquart to concentrate on improving its image and developing sales through the on-premise.

“It’s complementary for Jacquart,” says Reinteau of Montaudon, “because Jacquart is more premium with a more on-trade focus, while Montaudon is more retail focused.” Also, the new label’s main market is France, and Reinteau sees an opportunity to raise its international presence. “Globally we plan to double its volume within five years, mainly in France, but also in the UK, Germany and a few other markets,” he explains.

At the same time, Reinteau repositioned Jacquart in the UK, appointing on-trade specialist Enotria as exclusive agent, a handover that was complete by the end of 2010. As he said at the time: “Champagne Jacquart has a clear vision for strengthening its premium status especially in the on-trade and wine specialists. We believe that Enotria is the perfect partner to achieve our ambitions.” Speaking more recently, he explains: “Jacquart has a value strategy, but that doesn’t mean there won’t be volume development. If you are successful with your brand proposition you can grow both in volume and value. But value is the priority with Jacquart.”

CUTTING DOWN

Once the new UK distributor was in place, Reinteau began work on the next stage in the Jacquart story. This came with a range revision and repackage, which was unveiled for the first time at last month’s London International Wine Fair. As a result, Jacquart’s Mosaïque range (pictured overleaf) now comprises just four Champagnes – a brut NV, rosé NV, blanc de blancs (vintage) and extra brut – to simplify the offer and focus on the most commercial cuvées. However, the range-topping Brut de Nominée has survived the cull. “With this new brand platform we are concentrating on developing sales in the on-premise, especially in the UK, because historically Jacquart was more for the off-premise in the UK [when distributed by PLB],” he explains.

Once broader on-trade distribution is in place, Reinteau says Jacquart will “start investing in the brand image as well”. This will focus on bringing the trade and consumer’s attention to two key aspects of the Champagne. “The first is about true pleasure and authenticity,” he begins. “We can explain to our customers all the secrets of the product from the beginning to the end because we control 100% of the process, from the growing of the grapes to the winemaking.” Continuing, he says: “Jacquart is the winegrowers’ brand, which is why we can talk about true pleasure.

“The second part,” he adds, “is about good wine, good design at the right price. It is not about bling, not about ostentation, but it is about hedonism.”

While transparency is important, so is simplicity to the new Jacquart. “We need one message,” he states, and, referring to the aforementioned range revision, he stresses, “while we used to have 19 different products – with a different range for the on- and off-trade – now there are five.”

With the previous situation, Reinteau asks rhetorically, “If we were running an ad campaign, which label would we put in it?” He also says that the new look “builds on the existing strengths of the brand”, and retains the logo with its allegorical figure of fame (La Renommée) riding her winged horse Pegasus.

Then there’s a new winemaker, Floriane Eznack, who, like Reinteau, comes from Veuve Clicquot, and took up the role in May this year. She is currently looking after winemaking as well as wine communication, although Reinteau says there will be no change to the style of Jacquart, which is driven by a high proportion of Chardonnay – it accounts for 35-40% of the blend.

With these changes now in place, Reinteau is hoping to expand the amount of Jacquart sold internationally. “Fifty-five percent of Jacquart’s total sales are in exports, but the target is to take that to two-thirds,” he states. The core business is France, the UK and Germany, but Reinteau has also selected a list of “strategic markets where we will over-invest to increase the development of the brand”. These include the US, Hong Kong and Switzerland, as well as, but of lesser importance, China, Canada, Brazil and Spain.

Explaining this approach, he says: “If you look at per capita consumption in France or Belgium, it is one to three bottles of Champagne per year, but in the US, it is a glass, in Brazil it’s even less, and as for China… no comment.” Building a presence in emerging markets now, however, is important for Jacquart, because “it’s less costly than waiting and going in when the markets are mature”.

But what’s the main motivation for Reinteau’s change of approach in the UK – a market that accounts for 9% of Jacquart’s exports? Surely shifting from distribution in mainstream retail to the on-trade will affect Jacquart sales? “Champagne is about value,” he quickly states, before stressing that the pursuit of a purely volume strategy is unsustainable. “Shortages are always part of the business – Champagne is 35,000 hectares and while you can adjust the area a bit you won’t change the business model – you should go for quality and value,” he says.

Nevertheless, if there’s an operation with an enviable supply of grapes, it’s Jacquart. As Reinteau reminds, the brand sells fewer than 10 million bottles but has – through Alliance – access to 2,400ha, which represents a production of 24m bottles (based on an average yield of 1,200 kilos of grapes per hectare). This, Reinteau explains, brings stability to Jacquart. “The supply of grapes is one of the key success factors and if one is to be successful in Champagne you have to have a high-quality grape supply.”

INVESTING IN THE BRAND

The situation does not however, bring a temptation to discount, because while Jacquart may have the grapes, it, like the rest of Champagne, faces increasing costs. “Grape costs are rising – this year again they are up by 3.5%, that’s a fact,” he says, adding, “but at the same time we are able to increase prices by 3-4% this year.” And, as he points out, “Because our shareholders are wine growers they look for a long-term return – we are not looking at the stock exchange; we can afford a smaller return in the short term and invest in brands.” And as for brands, Reinteau is clear on the threat. “There are still lots of brands in Champagne – there are 13,000 – and this for me this is too much and there needs to be a contraction.” This he believes will occur due to a “the lack of investment by brands in advertising and promotion”. Explaining the challenge, he says, “If you compare Champagne to spirits, the spirit model is very low-cost production and very high advertising and promotional investments and therefore well known brands.” In Champagne on the other hand, the rising cost of grapes (and pressure on retail prices), Reinteau believes, is making it harder to invest in brand building.

Summing up, he presents a powerful contrast. “Two thirds of the cost of a bottle of Jacquart goes on the grapes. If we were making vodka, this would be less than 10%.” And, as he states, “This is something we need to be cautious about.” db