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Lindemans goes global; Rosemount relaunched

Published:  23 July, 2008

by jack hibberd
It's all happening Down Under. And it's all happening for Foster's. On the same day that the Australian drinks giant announced its full-year results (and rumours circulated that it was an acquisition target) it released its bold plans to revitalise the ailing Rosemount brand and launched a new range that takes Lindemans global.

Wines from Chile and South Africa will be released under the Lindemans name in the hope of revitalising the struggling brand - which has posted a 20% drop in UK volumes in the past year. The country-of-origin range' will initially comprise wines from South Africa to be distributed in North America in October this year, followed by South African and Chilean wines destined for the UK and other European markets. The Chilean wines will be produced by Dallas Cont, a Foster's-owned winery in the Maipo Valley, and the South African wines will be sourced from Roodezandt, a 1,400 hectare

co-operative in Robertson. Although UK distribution and pricing have yet to be finalised, the wines are expected to be priced at a similar level to the existing Bin range' according

to a UK spokesman.

Lindemans global brand director Oliver Horn commented: We identified a significant opportunity to open up new growth areas for the Lindemans brand. Consumers are interested in experimenting with wines from new places, but they want a reliable choice from a known and trusted producer.

The research also revealed that the Lindemans brand was seen as a truly international brand - and not Australian-specific - by consumers in the European and North American markets.'

The big news from Rosemount - which has been performing even worse than Lindemans, with sales slumping by almost a half in the UK in the past year - was that the entire range (which has been streamlined and simplified) will be packaged in

a proprietary' bottle with a diamond-shaped base that tapers up to a standard Bordeaux top and neck. The entire range will also be bottled under screwcap.

Rosemount global brand director Simon Marton said: Following Foster's acquisition

of Southcorp in 2005, we took the time to reflect and fully understand one of Australia's great wine brands. We have taken a long look at the quality and style of the wines and we have made improvements wherever possible.'

The brand has been split

into six distinct tiers, with confusing' parts of the brand architecture, such as the Orange and Jigsaw labels, discarded.

The entry-level tier consists

of two separate propositions, Ryecroft (retail) and Rosemount Road (on-trade). The brand then moves up to the two premium tiers, Diamond Cellar and Diamond Label. The two super-premium tiers are Show Reserve (region-specific wines) and Flagships (a range of single-vineyard wines). Recommended retail prices have not yet been released but are expected to follow the existing pricing, with the Diamond label wines at 7.49 and the other tiers priced in accordance.

A new advertising and PR campaign, together with limited' promotions and a sampling campaign will back

the launch. The new wines are expected to hit UK and Australian shelves in November with the rest of the world expected to follow next year.

Away from the wine launches, results day was a mixed bag for Foster's. Excellent results from its beer division - which pushed net profit up to A$1.16 billion - stood in stark contrast to its wine business, which saw organic sales grow by just 1.9% in a low margin environment.

On the bright side, Foster's

chief executive Trevor O'Hoy announced that synergies arising from the takeover of Southcorp were ahead of target and were expected to realise A$130 million this financial year.

Foster's shares jumped 8%

after the announcement of the results, driven both by the better-than-expected performance of the beer division and by rumours that the world's two biggest brewers, SAB Miller and InBev, were preparing takeover bids for the company. Analysts commented that although Foster's beer assets were attractive, its under-performing wine assets (which account for more than half of the company) made a takeover unlikely in the short term.