Potential acquirers for Champagne Piper & Charles Heidsieck may include LVMH with Thienot Group or Lanson BCC with Investors: Two « Best Fits »?

(This editorial is the executive summary of an exclusive VitaBella report)(More wine news on www.vitabella.fr) At the time when COFCO Wines & Spirits, a subsidiary of COFCO (chinese largest food processor, manufacturer and trader), is announcing a new acquisition in Bordeaux and global luxury group LVMH's company Moet Hennessy, in a first-time move, has crushed about 150 tonnes of grapes in India, Champagne makes its slow revolution with the soon-to-come announcement of the Piper & Charles Heidsieck acquisition deal. After a first analysis - on December on www.vitabella.fr - of potential non-French acquirers, let's now focus on two French collaborations (LVMH with Champagne Thienot and Lanson BCC with investors) which could finally make the deal. Should we consider it as a "French Affair" or as a perfect strategic and financial match? In fact, both associations would make sense but sometimes for different reasons...

LVMH / Thienot Group

1) Makes sense as LVMH is looking for new grapes sourcing contracts. In fact, listed company LVMH has recently prepared the financial market and said that there could be a "Champagne shortage". So it's high time to buy new parcels and get more grapes to secure the next sales made by a powerful distribution network.

2) This association makes sense as LVMH is mostly interested in securing grapes sourcing contracts and less in acquiring new brands. LVMH"s Strategy is about strengthening an already large brand portfolio and not broadening it. Prices and margins are key focuses in the future.

3) The historical roots of Thienot Group are in Champagne. Thienot Family has already developped a brand portfolio with Canard Duchene, Marie Stuart and of course Champagne Thienot. Financially, the group recently invested heavily in CVBG to get access to grands cru wines from Bordeaux. Strategically, in terms of image, it is crystal clear Thienot group wants to go more up-market either in Bordeaux or in Champagne. Consequently, after the clever acquisition of CVBG, it would make sense that "A grand house of today " - as they name themselves - invests in a widely recognized Champagne brand. And in this particular situation they would get two, with the "up-market boutique" Charles Heidsieck champagne brand and the globally renowned Piper Heidsieck brand which is currently quite successful in terms of image with the top Rare Cuvee.

Lanson BCC / Investors

1) Association would make sense as an "investors only deal" would rapidly may be confronted to a lack of a strong "Champagne related support" that would secure and strengthen existing grapes sourcing contracts, make the day-to-day operations work properly and also sell bottles through an existing distribution network.

2) Also makes sense as listed company Lanson BCC has a great experience in integrating big companies (The management team worked on the Lanson integration into the entire group and this can certainly be considered a major achievement when we look at the excellent future prospects for Lanson BCC).

3) Makes sense as Lanson BCC continues its expansion and is always interested in considering new opportunities for strengthening sales and developping new markets.

Any non-French company could acquire Piper and Charles Heidsieck, but it appears that both French associations look very attractive and "well fitted". Now let's think about "what's Next?". After the acquisition, those who buy parcels and get grapes sourcing contracts will get prepared for a future "champagne shortage". And those who buy assets and liabilities will have to focus on value maximization which is first of all a matter of achieving great results on a day-to-day operational level. Just considering brand assets, the new marketing team will have to play without the "third Heidsieck key", the Heidsieck Monopole brand owned by Vranken. It will certainly make future brand marketing plans for Piper and charles Heidsieck more complicated. Confusion among consumers may continue to exist. And, for this reason, the future repositioning of both brands may be at risk. (More wine news on www.vitabella.fr)


QR Code or Microsoft Tag…Wine Estates take to Mobile Devices for Social Media but what Technology should they use?

(This editorial is the executive summary of an exclusive VitaBella report)(More wine news on www.vitabella.fr) QR Code, a strange name for wine promotion...You may already have seen these 2D bar codes, a black-and-white industrial look of a standard bar code. They can be found on shelf-takers, bottle-neckers or wine list stickers and consumers with smartphones can quickly and easily scan a bottle of wine that catches their eye to get more information about the wine, the winery, recommended food pairings and much more. In fact, it is a very good idea to promote a winery and its wines with this new technology and there will certainly be competitive initiatives in the future.

PSFK, a marketing trend service, has recently released a report on “The Future of Mobile Tagging.” They analyzed the future use of technologies that include QR codes, barcodes and Microsoft Tags in branding activity and communication campaigns. They mentionned mobile tags offer a unique opportunity for brands to interact with potential and existing customers. "The two dimensional barcodes can be applied to almost any surface and the information contained within them can be leveraged to create incentives and drivers that lead consumers along the purchase path. By bridging the online-offline divide with a click of a mobile phone button, mobile tags can drive a brand or product’s awareness."

And Microsoft is getting into this market with a powerful new offer, Microsoft Tag. Microsoft Tag is a dynamic and no-cost solution to enhance marketing campaigns. Wineries can create a unique personality and customize interactive experiences with customers. Wineries can also create standard or custom Tags for brochures, ads, catalogs, in-store displays, posters, business cards, or just whenever they want a unique design. With Microsoft Custom Tags, the code can be integrated into the look and form of the messaging itself.

In fact, Microsoft is pitting its Microsoft Tag technology against the QR Code, which is an open industry standard, originally created in Japan. USA Today is using this technology and readers can scan a tag to be directed to online videos, photo galleries or updated financial and sports news. Universal Pictures also adopted the Microsoft's version of the QR code, the "3D barcode" for the launch of a new film. Smartphone users can interact with full-page ads in magazines and have access to a large content.

A number of publishers have been looking at the use of these kinds of tags for some time. Mostly, mobile barcodes have been pretty successful in Japan, but have been slow to catch on in the rest of the world. But as smartphone (Apple’s iPhone, BlackBerry and Android devices) penetration increases, the use of tags will certainly become more prominent. Wineries should leverage on this new technology ang get a modern approach in their marketing strategy. But before choosing between QR Codes or Microsoft Tags, they must get prepared to invest some time and money before getting any return on this new technology...(More wine news on www.vitabella.fr)


Tignanello and Solaia, a Pure Definition of Luxury Wine by Antinori

(More wine news on www.vitabella.fr). Tenuta Tignanello, with its famous Tignanello and Solaia vineyards, is situated between the Greve and Pesa valleys in the heart of Chianti Classico exactly between the little villages of Monteridolfi and Santa Maria a Macerata, 30km south of Florence. Tignanello covers 350 hectares of land, 147 of which are planted with vineyards, These are divided into small plots: the Tignanello vineyard covers 47 hectares with the 10-hectare Solaia alongside. These lands derive from Pliocene marl, with shaly, chalky elements, and are situated at an altitude of 350-450m, enjoying warm days and cool nights during the growing phase.

The native Sangiovese variety and the non-native Cabernet Sauvignon and Cabernet Franc varieties are planted at Tignanello. There is also a small quantity of white grapes - Malvasia and Trebbiano - used in the production of Vinsanto. Other non-native varieties grown at Tignanello include small quantities of Syrah, Pinot Nero and Merlot, planted experimentally in the Seventies. Antinori initially experimented with Cabernet Sauvignon and Cabernet Franc in the Twenties, but these varieties were then abandoned during the Second World War; they were replanted in the Sixties and began to be used commercially in the Seventies. The grapes are picked in about three weeks, between the end of September and early October and crushed and fermented on the estate. Afterwards the wine is aged in the old cellars below Villa Tignanello.

The 16th century villa on the estate was built on the foundations of one dating back to 1346, when the land belonged to the Buondelmonti (like much of the Val di Pesa). The estate was later taken over by the Niccolini who renamed it Poggio Niccolini, and in later years it was purchased and resold by various local aristocratic families. In the 17th century it passed to a cadet branch of the Medici family, who named it Fonte dei Medici, and subsequently to the Antinoris in the mid-19th century.

In this beautiful environment, Tignanello and Solaia are grown, made into wine and aged at Tignanello while other grapes grown on the estate are used in the production of Santa Cristina, Villa Antinori and Tenute Marchese Antinori. In his artistic-historical guide of the town of Sancasciano Val di Pesa (1892), Carocci describes Tignanello (now a large estate with extensive vineyards) as one of the highest and most picturesque points of the whole area. On the top of the hill, a scenic position rich in plantlife, stands a small group of houses, some of which are very old indeed. A splendid tuscan scenery for a beautiful wine story recognized internationally. (More wine news on www.vitabella.fr).