The just-drinks interview – Cyril Camus
Much like the product he markets, Cyril Camus - though only 35 - represents a combination of youth and maturity. In this month's just-drinks interview, the CEO of Camus Cognac talked to Olly Wehring about Cognac's changing consumer base in China, the challenges of being a one-brand company and Camus' relationship with the rapping fraternity.
The art of Cognac-making is said to lie in the blending, not least of mature eaux de vie with the more zestful aromas and tastes of younger spirits. And it appears that Camus Cognac takes a similar approach to management. At 35, Cyril Camus is pretty young to be heading up a Cognac company, but Camus combines youthful verve and a sensibility towards modern tastes and fashions with a knowledge and respect of Cognac's own culture that one would expect from the great-great-grandson of the company's founder Jean-Baptiste Camus.
It's been a long day for Cyril Camus. The Camus Cognac CEO has spent the whole day entertaining journalists at an open tasting in London. The last thing he appears to need at this late stage is a just-drinks grilling. Thankfully, he's happy to sit back, pour us both a drop of Camus and take whatever just-drinks is prepared to throw at him.
We begin by looking at the Cognac category in general, and how it has been performing of late. "It's doing very well and has been growing steadily for the past four years now," Camus says. "It's growing at about 5% to 10% depending on the area, so it's been good. We're pretty much back to historical levels in terms of quantities shipped."
The growth, however, seems to be coming from just the Chinese and US markets. "China is a more recent phenomenon, growing especially last year, while the US has been posting double-digit growth year-on-year for the past five years. The US now represents a third of the total Cognac market."
In other markets around the world, the category is stable, Camus noted. "There appears to be a slow upgrade in terms of quality. The percentage of VS within the total Cognac category seems to be shrinking in most markets. People are moving up the premium-ness ladder, but not really in most cases drinking more Cognac."
While this trading up appears to be keeping Cognac on an even keel around the world, Camus is keen to highlight the link between the product and economic conditions. "If you take mature Cognac markets, like Europe," he says, "Cognac consumption may go down a little, may increase a little, but it is somewhat stable. If the economy has been doing well in that country for a period of two to three years, then people start trading up. Sometimes when the economy picks up rapidly, you get new entrants. In other less mature markets, when there is new wealth created, then Cognac sales pick up - that is the case in China, where the growth comes purely from new entrants. The growth in the US is the same thing in many ways."
Camus warns, however, that the flipside is that, when there is the slightest hint of economic downturn, Cognac tends to suffer. "It's a luxury product, in many ways."
Camus' favourite market appears to be China. Prior to becoming CEO in 2003, he studied and worked in the country. Nowadays, he regularly travels back to China. The novelty of Cognac - and having expense accounts - saw the Chinese embrace the category in the mid-90s. Although the Asian economic crisis in 1997 skirted China, the country's business community took heed and erred on the conservative side in their entertainment expenses.
Camus saw its Cognac sales in China plunge, from almost 1m cases in 96/97 to 350,000 the following year. "It's only two years ago that sales of Scotch and Cognac started growing by around 40%, 50%, 60% year-on-year," Camus notes. "This is driven by an entirely new section of consumers. It is the middle class that is starting to consume Cognac. The rapid acquisition of wealth in China has led to the creation of a middle class. They've bought their cars, they've bought their apartments, now they're spending on not-necessary, luxury items.
"That is a much bigger, more stable business than the elite we had in the mid-90s," Camus continues. "The sheer size is driving the increase in sales. Every year, there's a few more million that gain this spending power. People have always been saying: 'One day China' - but it's happening right now on a scale that is starting to make a huge difference. The Chinese urban middle class is now bigger than the whole population of France. So, it's pretty exciting."
While discussing the US a little later, Camus mentions how helpful the link with the hip-hop and rap fraternity has been. I gingerly ask him how he feels to be linked with this group in the country. "This is where I have to be very careful," he laughs, in light of Cristal's recent run-in with rapper Jay-Z. "I look at it more in terms of culture than anything else. There's a whole generation of the urban population, regardless of race or colour or musical aspirations, who like to spend on good things. People really want to enjoy themselves through food, drinks, travel - it's a different type of spending than the 90s. It's more an Old World type of consumption. We feel great to be a part of that change."
Looking more specifically at Camus, I ask how the company can compete with the might of Diageo and Pernod when it comes to pushing brands. "By being different - there's no other way," Camus replies. "We don't have the distribution power that they have. We also lack the financial means to invest for too long, too heavily behind a particular product. They can take profits from one mature category and invest in a new one - we can't as we are a one-product company."
The only thing Camus feels it can do in this area is market products that other companies either don't care to offer, or have been unable to. "We have to provide something useful and new to the market," he says. "This is what we've been doing with our Cognac range recently. Our range is a reaction to the consolidation in the industry. We have made a break in terms of taste, product profile and packaging. Instead of evolving our plans we decided to break from the past. Our Cognacs are now more approachable. We may lose some traditional consumers but we believe this is the taste profile of newer spirit drinkers."
As our time draws to a close, what's been most notable is that despite his age, Cyril Camus has a good handle on where the Cognac category has been in the past, as well as where it's going in the future. Camus is a rarity in the Cognac market - a young chief with dynamic hopes for his company's brands. Those young shoulders carry, if not an old head, then certainly one full of bright aspirations.
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