Ep. 1986 A Conversation About LVMH's US Trade Strategy | wine2wine Business Forum 2023

The Italian wine podcast is the community driven platform for Italian winegeeks around the world. Support the show by donating at italian wine podcast dot com. Donate five or more Euros, and we'll send you a copy of our latest book, my Italian Great Geek journal. Absolutely free. To get your free copy of my Italian GreatGeek journal, click support us at Italian One podcast dot com, or wherever you get your pods. Official media partner, the Italian One podcast is delighted to present a series of interviews and highlights from the twenty twenty three one to one business form, featuring Italian wine producers and bringing together some of the most influential voices in the sector to discuss the hottest topics facing the industry today Don't forget to tune in every Thursday at three PM, or visit the Italian wine podcast dot com for more information. How we doing? Good. Feeling okay? Awesome. So my name is Adam Teeter, and I am the co founder and CEO of Vinepair. Assuming most people here are familiar with Vinepair, but if not, we are a, American publication about wine beer and spirits based in New York City. And, I'm very excited to be joined with my friend Ygrene Regent, who is I'll let you tell everyone a little bit more about yourself, but Sure. The head of trade advocacy at LVMH in the US. Trade engagement and advocacy. It's a long one. Well, it's really nice to, to see you all. Yes, a little bit of background about myself. I, landed in the US twenty years ago from France originally. With literally two suitcases and, and a big dream of working in the in the wine industry. I was lucky enough to find an opportunity with, an incredible man, Bill Deutsch, if some of you who knows, Deutsch wines and spirits, He was just starting to become big in the US, through his partnership with George DuBef, another incredible, person in the wine industry who I had the privilege of representing in the US, really learning a lot in terms of marketing, you know, selling fast, you know, two hundred thousand cases sold in a month. I think that's a dream of all of us. Also the time where the the the market was changing in the US with, Yellow Hotel, if some of you still remember that. So Deutsche had this, brand in the portfolio was starting to take off, and it was so interesting to understand how you can come in and disrupt completely, you know, the wine industry at the time. French wines were number one in the US with ill in that far, you know, but, then all of a sudden, this brand arrived and just changed everything we knew about marketing wine, selling wine. So it was really interesting to be part of this, and and and understand the, how all this worked. But very quickly, I wanted to know more about marketing and commercializing, luxury products. So I had an opportunity with Mowen, Tennessee, at first selling some incredible, amazing wines, and I know one person here is in the, audience. I had a privilege of selling Italian wines, Monsanto was one of these beautiful, properties that we were representing, but also leave you a Feluga, Capetana, that really taught me a different way of approaching, you know, again, premium and high end wines, in the US, which was very different. Then I took a little step aside even though I was working for a shame campaign company, but I went to Pernou Ricard to, lead their strategy for, for champagne and sparkling, and came back to Moa, Tennessee, to lead Vavclico for, for the US, another incredible brand that has taken a very different approach in terms of marketing. And and is now the number one, you know, it's been the number one champion in the US for for a long time. And more recently, now I'm I'm heading a new department for Moat hennessy, which is trade engagement and advocacy. Which didn't exist before. And it's really about engaging with the trade. And the trade is a big word. Right? The trade in the US as most of probably, you know, the the US market is very different than the rest of the world. We have this three tier system where we have to go through different layers before we can actually talk to the consumer. And I think most of the time we focus on the consumer, which is great, but we also realize that there's this layer that we need to really engage with get on board to be able to to be successful in the market. So my role is really to ensure that our message is consistent, you know, through the line. It's a long answer. No. It's a great answer. I think is everyone a really nice perspective of of your background and expertise. And one of the reasons I wanted to have this conversation today was I think in our industry, your company has held up more than any other as just an excellent marketer who is very good, especially at building luxury brands. And as we know, the, you know, American tastes, especially are moving towards premiumization. So I I think we're we're in the perfect place now to have that conversation. So in your role, I I know you you focus on both now wine, champagne, and spirits. I wanna focus mostly though on wine and champagne today because this is a wine audience. LVMH is often held up by your competitors as the premier luxury wine portfolio in the world, with your marketing efforts, second to none. What do you think it is that makes your marketing strategy at LVMH so successful and so enviable? So first of all, great. People think that. You know, I think first of all, we we have in our portfolio some incredible brands. We have brands, we call them, right, houses that are centuries years old. You know, they will outlive me and everybody else, you know, and I think understanding that our role is within the life of those amazing houses, maisons, families, whatever. We have just that tiny little impact on it, gives gives you a little bit of a perspective. Like, I I think the the hardest part sometimes is to just say no. And when and I'll get to why I'm saying this, but it's just because saying no now in the long term will be beneficials for those brands. I think we have a tendency to just see what's just ahead of us. And making those decision because it's important for the business. I mean, right now, the business is difficult. I think for a lot of people, and this is the time it's the critical time to make those good decision that is not about reacting to what's going on right now. But really having this vision in the long term. So I think what what Hannahcy is, at least, doing well, is making sure that everything that we do is not impacting the today of this year, but really understanding what this will have in the long term. And so, yes, it's sometimes it says, no. You have this big account that's gonna drop, like, you know, telling you that they're gonna do this massive, you know, sales. Are you enjoying this podcast? There's so much more high quality wine content available for mama jumbo shrimp. Check out our new wine study maps. Our books on Italian wine including Italian wine unplugged, the jumbo shrimp guide to Italian wine, Sanjay Vazzy Lambrusco, and other stories, and much, much more. On our website, mama jumbo shrimp dot com. Now back to the show. It might not be the right image. It might not be the right consumer you're going after. So for the moment, you know, it might be, yes, that's I need this. But in the long term, it might hurt you. So it's a it's a process that we're always thinking like, okay, is this the right thing that I'm doing for the long term with my brands? And again, like, going back to to marketing, you know, besides those very commercial decision is also making sure that we're telling the stories of the brands. All of our maisons, all of our houses are fredible stories. And it is our purpose, really. Our mission is to continue to tell those great stories to our consumers, to tell those great stories to the trade. I get them engaged with them, and it's like this very clear focus of long term vision, the investment in the right place, and just always bringing back the story, of the brand. So I wanna talk about storytelling a little bit. I think One of the things one of the conversations you and I have had in the past is that there seems to be when it comes to trade and storytelling, especially for wine and champagne brands, a fixation on technical details on talking about, you know, the terroir, you know, how the fermentation process happened, whether it was, you know, native inoculation or some, you know, what was added. And you basically said to me, pretty bluntly, that doesn't matter to us. That's not how we speak to the trade. Why does that not matter to you? And and why do you think that the way that you speak to the trade is more important? It's true. I mean, it's I would say even beyond the train in general, like, even to the consumer, are we're focused on lifestyle. That's basically in one word, that's what we do. Like, we feel like, you know, you can what's gonna make you different than your competitor that you have thirty percent chardonnay versus forty? Like, is that really gonna resonate with someone saying, oh, that's a lot better. You know, I'm like, I I'm not sure this is what, you know, the trade or the consumer is looking for. They're looking for the experience. They're looking for what it means to enjoy this product, the brands to be part of this world, you know, to elevate them to something that is different. So focusing on the technical terms. I think everyone can do it, and it's good to have it. I'm not saying, like, whenever, you know, of course, we're making sure that this is important. There's a lot of people that love to geek on, you know, all of that. And we wanna make sure that it's obviously available, but This is not the first approach. Like, we'll go first with what the brand represents the storytelling, making you part of the world of this particular maisons or the story of the family or, you know, the place or I think we believe that this has a lot more impact than technical terms because it's hard to be competitive with technical terms. You know. How do you how would you respond though to someone that says, okay, the stories, but aren't there lots of French producers that have similar stories. So that's why I rely on my technical details or, you know, that's why I talk about where I grow the grapes or, you know, how we make the wines because I feel like every chateau could be owned by, you know, fifth generation sixth generation? I think you should not be in the wine industry. I'm just kidding. No. But I think, like, honestly, like, everyone has a story. I think this is the beauty of wine, you know, and and champagne, and everyone has a unique story. You have to find your angle. You have to find what makes you, you know, the reason why even exists, you know, this passion. I think this is a product that is filled with passion and stories, you know. So I really truly believe that everyone has something different than their neighbors, you know, or, you know, and it doesn't mean it's better or not, but it's different. And it's who you are, and it will resonate better with certain, you know, with a certain audience. But it's finding that, yeah, that that thing that's, that's unique. And it doesn't mean that it's center result. Like, Moahanosi is, you know, acquiring brands that are not center is whole today, but we see the future. We see that there's usually a family behind it or a story that will leave, you know, for a long time. So it's just finding that angle that makes you different than, you know. That's that's that's a great answer. So how do you think your approach to the trade differs from other wines or champions? Or how do you look at the trade? How do you view them? And then on top of that, how do you take different tactics with the trade for different brands? Or is it one sort of strategy that you and your team and body for every single brand that you guys have? Yeah. It's interesting because I think the power of LVMH and more hennessy years about this mezzon management. Right? It's like every mezzon is treated differently. There's a different mezzon owner or ahead of a mezzon, you know, and they're they're almost in competition. You know? I remember when I started over with Clico, my competitor was Moet. You know, and the guy was sitting next to me, like, we're in the same office, but somehow it's it's encouraged the way that each houses has to be treated differently because they all have their, you know, different stories and different, you know, audience and whatever. But When you speak to the trade, though, I think that's very different, and that's how my department has been created, we're realizing that that's not working as well. Because if you were trade, meaning, like, so what do we mean by trade? We mean, like, our distributors in the US, the people that are we have to go through them to sell, finally to a, you know, an account. The on premise manager, and then the owner of a restaurant, the owner of a hotel. I mean, everyone who is gonna touch your product before he gets to the consumer. That's what I'm I mean by trade. But these these people are engaged with different companies, not just brands, but really, like, you know, it's gonna be with Diageo, it's gonna be, you know, the Purnos. So important that we have an approach as more analyses. So I we engage. We do this differently as a portfolio. And we try to find the common what's so common between all of our brands then when we speak about, you know, to the trade. And it's usually about this, you know, obviously, we are, you know, luxury positioning, but also how we can, you know, bring different experiences to them to understand the world of Moennessy is different than you might find in, within our competitors. But We have this approach more portfolio than we would if we were talking to a consumer. Okay. So obviously post COVID, a lot of people have spoken about how the traditional ways of building a wine brand are different. Right? Oh, we can go direct to consumer, we can go into store, but you and I spoke actually today at lunch about how you still really do believe that the best brands, the best wine brands are built in the on premise. Why do you believe that? Yeah. It's interesting when he's thinking about it. I also think it's at a certain price point. Yeah. Maybe Which for your wife? For Moennacy's price point or positioning, we still strongly believe that the on trade is, how you build brands. And as we're launching new brands, as we're launching new skews within the portfolio, we'll make sure that we are very targeted in terms of the on trade. But then it's also how you defy the on train. Right? So we have now multiple classification about, you know, where we wanna be. It's about this very selective mindset, because accounts are as influential as you know, could be, you know, a press article sometimes or a, you know, influencer on Instagram. But where you are positioned by the glass and on the list is has a lot of impact in terms of the perception of for the consumers. So they're seeing you in this account that they love, and and the and the on trade, again, is offering an experience that the off trade can never offer. Right? It's like you hopefully having a good time when you're at a restaurant. I I hope and then this, you know, opening the barrel and and enjoyment, this experience helped build the brand, and not to mention, obviously, tasting it because you hope to be by the glass, and that's a chance for consumer to try your products. But this is really building kind of a world around your brand that you would love to create that sometimes you can't as a company because, you know, you know, next to the consumer. And then we we believe that this helps pull cases or products, off the shelves in the off trade. So you're basically responsible for seventy five percent of all champagne sales in the US and you But me personally. No. Well, you can take the credit. And you ran the number one champagne brand in the US, in terms of Vove, which is, I think, surprising to Europeans because Moet would be that here. But what happens on us with the trade is that trade can become negative towards brands that are so successful. And Vove has experienced that in some of the major markets where trade talk down about it or they don't want to talk about it. How do you handle that specific problem with a brand that is clearly so popular with the end consumer that the trade actually needs to be able to sell to? Yeah. It it it is a a a challenge in a way. And it's interesting because when I was on the other side of the coin, like, working for Perjuez and, like, at Pernie Recara, we were the small guys, and we're like, you know, I wish we could be, you know, Clico. And then when you're on Clico, you're like, oh, I wish I could be the smaller brand. So it's like, it's like, it's like, it's never good. But it's different, it's different tactic, but I think what we are, as we're engaging with the trade, we help them see or help them understand that the important part of the business is the consumer. And they have to let the consumer choose. You know, it's like you don't wanna be, like, they don't wanna put Vafrica on the wine list. It's a miss for them in terms of business opportunity. Like, they have to let their consumer choose for them, not because they wanna be know a lot of sommelier wanna have this, you know, this is me, this is my personality, it's my wife. Great, you know, like, but also make sure that you're putting wines on the list that are gonna sell. And, you know, we've had experiences and and where they, you know, they took Clico out of the list or the retail store, and they lost a lot of money. So then they, you know, they realized it. So there's a little bit of a business case to, to be made here, but also understanding that at the end of the day, this is the consumer choosing, not you being, you know, in in in between. So try to highlight that. And also, I mean, you know, we also wanna people know Vavkrica as, like, the yellow label. Like, that's Yeah. That's eighty percent of the sales, but we also try to open their eyes about, the house in general and all the different other products as they might be not interested in this one, like the vintages or La Grande or things like that. And a good blind taste is always, you know, is always fun to do. It's like, there's very, you know, that that sometimes helps some of those sales too because you have a concept, like you you you think that, you know, you know it and then you don't, you know, you don't enjoy it, but then Have you really tried it recently? You know what I mean? So we we do that a lot too. Cool. So switching from Champagne to Rosay. Recently bought Chateau Munutte, LVMH is investing a lot in Rosay. I was hoping you could talk a little bit about the strategy there, what you think is happening and how you as a company now view Rose. You know, I think there seems to be some somewhat of a bias in certain wine circles that it's just a seasonal wine. I think you and the company would disagree with that with all the investments you're making. So just talk a little bit about that and and where you all stand in in your view. Sure. So, the first the first, big, you know, acquisition was, Chateau Desquan, of course, which is by far the number one, Rosier in the US. Then it's not as common, but Chateau gallupe is another Rosier that we acquired, which is a crew, classier, there are, you know, crew within provence. And then finally, a minutie where so when whispering Angels is not the number one, you have minutie for the rest of the world. But really the strategy that the company is seeing, without, you know, revealing any secrets, but it's the company sees provence, as, you know, what champagne is to sparkling wine, provence is to Rosay. So there's really this idea of provence itself, so it's not any Rosay. It's really, like, focusing on that particular region. First of all, it's a very old region. Like, it's one of the oldest regions, in Europe and in France. It has a lot of history, and provence has proven to deliver quality, Rosay. So there's a real interest here. Like, it's really premium. And what can it become the the champagne of of Rosay in the sense that the lifestyle, first of all, that Rosay conveys for a consumer is very similar in many ways as champagne. The drinking occasion is also very similar. So you'll be surprised. And I don't know if you would think about this, but in the US, people drink Roset in high energy occasions. So at night clubs, basically. Yes. Day clubs. It it is you know, you have large formats of Rosay. It's it's becoming very wide in terms of occasions. So going back to your seasonality, this is no longer the case. And also the US, let's not forget, a lot of states are warm year round. So it's like we think US, New York or, you know, but like Florida, California, like, tax there's plenty of places where it's warm, you know, year round. So there's also this idea, but really it's about the occasion when people drink Rosay, it's it's starting to become very similar as as champion as well. And it's got this premiumization, opportunity, great value, to be honest, for this product. And, yeah, it's like Aperitif, dining, high energy. I mean, it's just like there's a wide range of opportunities there. Very cool. So you're also as a company pretty famous for your event strategy. I mean, polo is one of the coolest events that you do every year. But Why do why do as a company think that events are so important and how does that sort of inform the rest of your marketing strategy around? I will go back to also how the the US, again, you know, we we have very little control of our distribution. I think it's it's making LV image crazy because on the LV side, you know, all the fashion sites, they own their sale, you know, their retail stores, and they control everything from the top from Paris to, you know, the consumer. With wine and spirits is very different. We don't control the dis we don't control the distributors, right, as much as we want to. You know, we we can't legally, like, tell him what to do. And then there's a retail store where you lost in the, you know, this a million brands. I mean, this is lack of of ownership, you know, through the distribution is very, it's very difficult when you're trying to bring luxury, when you're trying to bring, you know, experience. So being able to create experiences for your consumers where they are invited into our your world is so important in the US specifically because then this is your moment where you control you have all the controllables. The the polo, the Vavclicopolo is such a great example of it. This is the only actual event that consumers can pay for it. I won't give you the secret of that, but, it's, an experience for a day, what it what it is to be in the world of Vavclico, it's about disruption too. I mentioned this before, but really disrupting. Like, this is a polo match in the center I mean, in New York. Like, it's pretty disruptive. Most people have never seen a polo match in their life and granted in a city. So it brings kind of this crazy idea of of doing something very different. And then these elevations about being in the world, again, where are you drinking champagne all day? This is like the fanciest picnic that you've ever had, you know, and you're into the world. So you really build you know, and it's also an education moment to learn about the brands, to learn about the story, to learn about the products, all in in wrapped into one beautiful, bow so that you become, you know, you have loyal consumers that are just falling in love, love with the brands. And that's, yeah, that's So you do you do events. Obviously, there's that polo is a massive scale. You do do things on a much smaller scale too. Right? So thinking about some of the producers that might be in the audience with with smaller brands that obviously don't have the budget for polo. How do you show up there? Because I think one of the things I've always noticed is you've been very good at like being at the Cool Hotel in the Hudson Valley where you take over Scribners and things like that. So how do you think about that on the smaller scale as well? Yeah. That's that's a good point. We also do like smaller. It doesn't have to be these massive events. Right? Some of the successes have also been, like the Krug House you know, like having, you know, renting this amazing house, it could be in New York or anywhere, and just transforming it with the in the to the world of this, you know, crew champagne and telling the stories. And then you can invite trade and consumers. So that's that's that's quite nice. Or partnering to your points. We have a few, across the US, great, partners accounts where you wanna, you want your brands to be there just because the, the, the, either the hotel, the restaurant, they just it just aligns who with who you are as a brand, tells it helps tells a story. And and that's that's honestly, this is the best situation because not only do you convey a story? You have your brands represented, but then you're also selling obviously. So this is great. But yeah, we do have a few partners across the US where we build again in the in the long term relationship with them and ensure that the brand is represented, but it also fits with, you know, it's a partnership with those accounts for sure. Okay. Last question for you, and then we'll move on to some questions from the audience. So you know, obviously, as a media company, we speak to both consumers and trade. And I know you have a, you know, Algamesh has a very specific media strategy as well. How do you approach working with media partners like us and others when it comes to really telling the story to trade? Honestly, I think particularly Vinepere, I'm gonna go back to disruption, but I think that is, you know, there's been so many very traditional ways of talking about, technical ways of talking about your product and the wines, and And we believe there's more to be said around experiences and, education in a fun and entertaining way that I think you offer, that is very different. The audience we're trying to reach is most likely, you know, within your world. So that makes more sense. And there's still this kind of technical education piece in a sense, but taught in a very fun and different ways and it can be in different mediums using podcasts as I know you you you're doing. This is where we see it more helpful for what we're trying to to achieve, I think. Yeah. Interesting. Thank you so much. This has been really I hope everyone else has gotten a lot of information. I thought it was incredibly interesting. I've I've always been really impressed by everything that you you have done and the company has done Thank you so much. I really appreciate it. Listen to the Italian wine podcast wherever you get your podcast. We're on SoundCloud, Apple Podcasts, Spotify, HimalIFM, and more. Don't forget to subscribe and rate the show. If you enjoy listening, please consider donating through Italianline podcast dot com. Any amount helps cover equipment, and publication costs. Until next time.