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Jadot Sees Potential In Burgundy’s New Côteaux Bourguignons Appellation

June 13, 2012

Burgundy’s Louis Jadot has seen sales slip in the U.S. market in recent years, but more consumer-friendly exchange rates—and the potential of Burgundy’s new entry-level Côteaux Bourguignons classification—could help spur growth.

Louis Jadot winemaker Jacques Lardière says smaller vintages and resulting higher prices have led to declining volumes for the brand in the U.S., its largest market. Jadot, which vies with Georges Duboeuf for the title of top-selling French wine brand in the U.S. market, does sales of around 430,000 cases in the U.S., down from 530,000 cases in 2007. But the weakening euro (currently trading around $1.25 versus $1.40 a year ago), along with higher domestic wine prices due to California’s grape supply squeeze, could make French labels more competitive in the eyes of U.S. consumers.

“If the euro gets down to around $1.10 or $1.15, we believe we’ll be able to return our U.S. volume to what it was four years ago,” Lardière tells Shanken News Daily. Jadot’s wines are imported by Kobrand, whose Kopf family has owned Jadot since 1985. The Jadot label boasts a sprawling portfolio that runs from $12 for its Beaujolais-Villages up through the hundreds of dollars for its Premier and Grand Cru offerings.

Lardière says the rechristening of Burgundy’s lower-priced Appellation d’Origine Contrôlée (AOC)—from Bourgogne Grand Ordinaire to Côteaux Bourguignons—provides an opportunity for the region to reintroduce itself and attract consumers further down the pricing ladder. Jadot managing director Pierre-Henry Gagey, who is also president of Burgundy’s Bureau Interprofessional des Vins de Bourgogne (BIVB) trade group, recently said, “This is not just a change in names, but a new product with an unprecedented position, a kind of gateway to Burgundy wines, especially for new consumers. The producers and trade will be expected to work this appellation proudly, while they tended to use Bourgogne Grand Ordinaire as a spillway.”

Côteaux Bourguignons wines—including single-varietal wines and blends sourced from throughout Burgundy—haven’t yet hit the U.S. market. Producers are still determining how they should be price-positioned in the U.S., but early response in other markets like Japan has been positive.

Jadot’s other U.S. goals include rejuvenating its on-premise presence. “We’re pushing to be more on-trade oriented in the U.S. We were much stronger there 30 years ago than now,” Lardière says, adding that the expansion of the Jadot and Kobrand portfolios over the years has helped increase their offerings but has also taken some focus from core wines like Meursault, which formerly enjoyed a wider on-premise footprint.

 

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