Pernod Ricard sees opportunities in China’s “ dual circulation ” strategy
Pernod Ricard China at the 1st CICPE Photo: Courtesy of Pernod Ricard
As China pushes a “dual circulation” development paradigm to deepen its domestic market, the French wine and spirits group Pernod Ricard China presented at the First China International Consumer Products Exhibition (CICPE) its goal of seizing the new opportunities arising from the policy to meet the growing diverse needs of Chinese consumers and meet its long-term commitment to the Chinese market.
To meet the increasingly diverse needs of consumers for imported wines and spirits on the Chinese market, Pernod Ricard China has presented up to 92 products from its wines and spirits brands – the greater number than Pernod Ricard. China has never shown at an expo.
“We have a lot of new products [in the Chinese market] in order to respond to the first part of the double circulation, which consists in increasing the local consumption of Chinese consumers, ”Jean-Etienne Gourgues, managing director of Pernod Ricard China, told the Global Times at CICPE, which was held in Friday, Friday. southern China. Hainan Province.
“We mainly devote ourselves to this item, bringing new products, new brands, creating new experiences to improve the consumption of Chinese consumers,” he said.
Thanks to the strong resilience and vitality of the Chinese consumer market, the company has experienced a strong market recovery since July 2020, recording 34% year-over-year sales growth in the first 9 months. for fiscal year 2021, according to company data. . Martell cognac, various brands of the single malt whiskey portfolio and Absolut Vodka also experienced rapid growth.
The booming e-commerce and live streaming industry in the country amid the pandemic has also contributed to the company’s rapid recovery in sales.
“The first [of the change] is that it allows us to reach a lot more consumers, especially in third and fourth tier cities than we ever would have reached before, ”said Gourgues. He added that the interactive way of presenting the product via live broadcast also helps in recruiting young consumers. in order to attract them to the Pernod Ricard China brands.
China is a market with enormous potential given the low market share of imported wines and spirits, according to Gourgues. “Imported spirits are only 1.5 percent today. But it was 1 percent five years ago, so it’s growing pretty quickly. There is a lot of Chinese consumer appetite for cultivation of drink, ”he said, pointing to the opening of more cocktail bars. and whiskey bars, as well as the burgeoning e-commerce industry.
Pernod Ricard China is opening more physical retail stores as the third axis of its investment to better integrate online and offline sales. For example, for Martell, last year she opened a store in Shenzhen, Guangdong, southern China, and opened another this year in Haiti’s Haitang Bay. She also opened whiskey stores in cities in southern and southeastern China.
A stronger presence in China
Besides introducing more brands to meet the diverse needs of Chinese consumers, Pernod Ricard China is also building a single malt whiskey distillery in southwest China’s Sichuan province and launching the distillery brand. by investing 1 billion yuan in 10 years. It shows the company’s long-term commitment to the market, Gourgues said, noting that the construction of the free trade port reaffirms the company’s confidence in China.
Since entering the Chinese market over 30 years ago, Pernod Ricard has closely followed developments and opportunities in Hainan, and has also invested in Hainan.
As China continues to push ahead with the construction of the Hainan Free Trade Port, Hainan’s location and political advantage becomes increasingly important, the company told the Global Times. Hainan is well positioned to serve both the domestic market and wider international consumers, and its business environment is constantly being optimized.
In order to further explore the Hainan market, Pernod Ricard opened the Martell Travel Retail store at CDF shopping center in Haitang Bay, Sanya. Pernod Ricard China said it will continue to strengthen its presence in Hainan, encouraging more consumers to know about its brands and the unique value of its products.
“Pernod Ricard China is very confident that Hainan will become a center of international tourism consumption, and Hainan will be one of the key axes of our future development,” said Gourgues.
Pernod Ricard China will continue to follow its concept of “Creators of Convenience” to enable Chinese consumers to enjoy more convivial moments and contribute to a sustainable future for China, he said.
Keeping strong confidence in the commercial potential of the Chinese market, the company also reiterated its commitment to contribute to the sustainable development of China. In addition to its new carbon neutral desk, construction materials for the company’s booth at the exhibition are recyclable, meeting environmental standards, and all tasting cups and straws are made from biodegradable materials.
According to Gourgues, while sustainable development is not a new topic, Pernod Ricard China still hopes to increase public awareness of the ecological concept in China by actively working with local authorities and partners, including the Center for Environmental Education and communication from the Ministry of Ecology and Environment and the Institute of Sustainable Development Goals of Tsinghua University.