Exclusive: LVMH-owned Hennessy Signs New Deal with Alibaba

    LVMH-owned cognac house Moët Hennessy deepens its collaboration with Alibaba's B2C marketplace Tmall through signing a memorandum of understanding.
    Courtesy photo
    Yiling PanAuthor
      Published   in Finance

    LVMH-owned wine and spirits maison Moët Hennessy today signed a strategic partnership with Tmall, the business-to-consumer marketplace owned by China’s largest e-commerce platform, Alibaba. The collaboration is a part of Moët Hennessy’s efforts to step up its offerings in the fast-growing market as consumers’ demand for luxury liquors is picking up.

    The new partnership, the first online in China for Moët Hennessy, seeks to “upgrade the customer experience,” the company explains, and will also strengthen the data collaboration between two parties, allowing Moët Hennessy to access Alibaba’s massive database to gain better insights into Chinese consumer behaviors. It includes plans for Moët Hennessy and Tmall to partner in areas including “new retail” initiatives, marketing and communication, and intellectual property.

    "When brands sign [partnerships] with Tmall, they are able to collaborate with us on a deeper level and tap into benefits from across Alibaba’s powerful ecosystem," said a spokesperson at Alibaba. Others players in the wine & spirits sector including American winery E&J Gallo and Vinexpo have signed such memorandums of understanding with the e-tailer previously.

    Luxury liquor maker Moët Hennessy Diageo China signs deal with Alibaba. Courtesy photo.
    Luxury liquor maker Moët Hennessy Diageo China signs deal with Alibaba. Courtesy photo.

    The partnership is being announced and signed on Tmall Super Brand Day August 31, when content from Chinese celebrities and key opinion leaders (KOLs) is featured, and Hennessy V.S.O.P 200th anniversary special edition is being made available for sales exclusively on its Tmall store, priced at 100 (RMB 688).

    “[We] will work with Alibaba to share more data-powered customer profiles and consumer behaviors,” said Andrew Khan, the Vice President of Marketing at Moët Hennessy Diageo China, “which will allow us to have more creative online initiatives for occasions such as a new product launch and brand event in the future.”

    Courtesy photo
    Courtesy photo

    Moët Hennessy Diageo China is a joint venture between the French luxury conglomerate LVMH and the global spirits group Diageo. Establishing an official presence in the mainland market since 2005, the brand has set up official stores on both Alibaba’s Tmall and in the last two years to cash in on the shifting purchasing habits of luxury liquor buyers in China.

    According to a whitepaper co-released by Alibaba and Hennessy this month, the liquor consumption market through online platforms in China reached 8.8 billion (RMB 60 billion) in 2017 and is expected to grow by 20 percent in 2018. Notably, cognac, Moët Hennessy’s core product, is projected--at least by the company itself--to account for 40 percent of the total online liquor sales this year.

    Earlier this year, Hennessy embarked on an elaborate and highly creative campaign of offline marketing and rebranding initiatives with its “Hennessy & Meal,” launching a number of food-related pop-up events in major Chinese cities like Guangzhou, Xiamen, Shantou, Shunde, etc.

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