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Pernod Ricard gives Argentina a big push

Published:  15 August, 2008

Pernod Ricard plans to invest US$10 million (£5.2m)in Graffigna over the next three years to make it the number one selling Argentine brand in the UK, writes Rebecca Gibb.

Pernod Ricard plans to invest US$10 million (£5.2m)in Graffigna over the next three years to make it the number one selling Argentine brand in the UK, writes Rebecca Gibb.

In the next 12 months, the San Juan-based winery aims to increase UK sales from 60,000 to 100,000 nine-litre cases. It will launch a Pinot Grigio in Thresher this month and it has also secured a listing for its Pinot Grigio and Malbec in Sainsbury's.

The drinks giant had not finalised its plans for Graffigna's promotional activity when Harpers went to press but it indicated that an initial money-off promotion is likely. However it does not intend to use deep discounting to grow volume sales.

Adrian Atkinson, wine development director for Pernod Ricard, said: "Now we have worked on the distribution platform, we can start building a brand that engages the consumer."

He added: "One of the challenges for Argentina is to get visibility for the country so we have a plan for instore activity. There aren't any established brands from Argentina.

We need to get Argentina visible at the point of purchase - it should not just be lumped in with South America."

While Pernod has other wineries in Argentina, including Bodegas Etchart in Cafayate and Balbi in Mendoza, Graffigna will be its "strategic brand" in Argentina. The winery is located 100 miles north of Mendoza in San Juan, an area that has traditionally been seen as a quantity rather than quality producing area.

But Atkinson said: "Graffigna is Pernod's focus. We are looking to push them as a real alternative to Mendoza. We need to get the trade to think about other regions than Mendoza. It is difficult to get people to come here."

Pernod Ricard has spent $8m (£4.2m) in the past five years improving technology in the winery and will also install a $1m (£0.5m) screwcap-only bottling line in time
for the 2009 vintage.

This story has been sourced from Harpers Wine and Spirit Weekly, which is available by subscription only. To subscribe to Harpers, please click here.

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