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It’s been the talking point of the spirits category over the past few years and decimated sales for some of the biggest brands. The anti-extravagance measures in China have hit cognac especially hard and, while global cognac sales are showing signs of recovery and some producers are heralding the start of strong growth, others are being more cautious.

Out of the four million-case cognac brands in the Millionaires’ Club, Martell felt the clampdown most in volume terms. The Pernod Ricard brand dropped 27% from 2.6m to 1.9m last year and was in danger of falling to third best selling cognac brand, behind Rémy Martin, if things got any worse.

Thankfully for Pernod they didn’t. Sales grew by 16% and volumes are back above the 2m case mark. According to Charles-Armand de Belenet, Martell, Mumm and Perrier Jouët marketing director, both Asia and Europe are now starting to look more positive for the brand.

“We are optimistic about the global cognac market,” he says. “The slowing economy had an effect on some of the more mature markets for cognac last year, such as China and Europe, but confidence in the category is starting to improve again, driven by solid investment in brand activity and premiumisation from key players such as Martell.”

Martell cognac achieved an overall 7% sales increase and managed to grow 4% in China, it was reported at Pernod Ricard’s half-year results in February 2016. The company says this was driven by Martell Noblige and XO and favoured by an earlier Chinese New Year – February 8 this year as opposed to February 19 last year.

It was the brand’s 300th birthday last year, accompanied by the usual celebrations and product launches that accompany such events. A sales decline in this year would have been hard to swallow. “Throughout 2015, Martell showed very good results in value and volume.”

Looking to the future, De Belenet says that, overall, the underlying market trends are still about decline, with overall spirits trends similar to 2014/15.

But he’s quick to add: “Cognac is more resilient than scotch and has a special place in the hearts of the Chinese. Although the market has been affected by the slowing economy, we are confident in long-term opportunities.”

The reason for this confidence? De Belenet says: “We strongly believe in China’s potential for growth in the long term due to the very low penetration of the category and the strong appeal of Martell. Imported spirits currently represent less than 1% of the Chinese market so there remains a lot of opportunity.”

De Belenet adds that there has been strong development when it comes to the number of Chinese travelling abroad. “The [management consulting firm] Boston Consulting Group forecast 11% growth in Chinese tourists between 2012 and 2030. Travel retail is now seen as the ‘sixth continent’ and is a key market for Martell.

“It is driven by travel retail-exclusive blends such as the Millésime 1972 – showcased in Hong Kong, Taoyuan, Changi and Kuala Lumpur international airports – and innovative pop up activations such as the ones in Hong Kong or Charles de Gaulle to celebrate Martell Tricentenaire.”

And in the short-term? “While the US is already dynamic with Martell growing in high double digits, it is too early to say when the cognac category will accelerate in China. Currently, Martell volume depletions are in slight growth in China, but value depletions remain slightly negative due to mix.”

De Belenet certainly takes the cautious stance and isn’t going to be joining other cognac brands that insist recovery is here to stay. When asked if forecasts of a 15% hike in global cognac and brandy sales was cause for celebration and in line with Pernod figures, he says: “As our focus is on premium, we do not look at brandy and cognac together. Regarding cognac, we remain confident in the long-term potential of Martell and its development as a truly international brand.”

For Pernod and De Belenet the anti-corruption wounds are still fresh and it’s very much about the long term. When sales can plummet 27% in one year the need for caution is understandable.

However, with the US and China as a focus there is hope.