Fashion & Fizz
V. Pisipati | Fashion & Fizz 2
Summary:
Woodin, a premium African clothing brand, will partner with Montaudon, a French champagne brand. The companies will launch special-edition bottles of Montaudon champagne in Nigeria, the world’s fastest-growing champagne market. This initiative will help Montaudon to increase its visibility within Nigeria, and also create a value chain localized within Africa. All profits will benefit Acción International, which provides microlending and vocational training within Nigeria.
Table of Contents:
African Luxury Market . . . . . . . . . Nigeria . . . . . . . . . . . . . . . . . . Nigerian Luxury Market . . . . . . . . Nigerian Champagne Market . . . . .
Montaudon Champagne . . . . . . . . Woodin Fashion . . . . . . . . . . . . . Product Concept . . . . . . . . . . . . Production & Distribution . . . . . . Lifecycle: Glass . . . . . . . . . . . . . Lifecycle: Champagne . . . . . . . . . Works Cited . . . . . . . . . . . . . .
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Africa is home to seven of the world’s ten fastest growing economies
70% of the population lives in countries with annual GDP growth over 4%; GDP of the African continent was 5% in 2013
The number of High Net Worth Individuals (HNWI) in Africa grew by 4% in 2011, twice the growth rate in Asia
Investible wealth of African HNWI’s is estimated at $1.1T
Luxury brands are already moving some production to Africa. Brands like Vivienne Westwood, Stella McCartney, and Fendi use artisans for embroidery
African prints have already influenced many design houses like Yves Saint Laurent and Manolo Blahnik
There were six Fashion Weeks in Africa in 2014: Lagos, Accra, Nairobi, Cape Town, Addis Ababa, Dakar
Despite overall growth, there are significant differences between each of the 55 countries in Africa in terms of buying power, trade infrastructure, and stability
“Africa does not need charity. Africa needs investment and partnership.”
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African Luxury Market:
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Nigeria is Africa’s most populous country and has the largest GDP, which has grown annually by an average of 5.7% over the past five years.
Weaknesses:• Low standards of products and services within Nigeria• Lack of advanced technologies and highly-skilled labor
Opportunities:• High population density can increase brand penetration• Demand is greater than supply of luxury• Initiatives to reduce corruption
Threats:• Increasing crime and fraud rate• Water and fuel shortages are increasing in frequency• High levels of corruption
Strengths:• Population of 200M; large age proportion under 30 • High, stable level of oil export sales is increasing GDP• Growing household wealth is fueling consumer spending
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Nigeria:
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Global luxury brands are now finding ways to target Nigerians both abroad and in the country
Most luxury purchases are made abroad in Dubai, Paris, and London. There is currently little infrastructure for upscale shopping and distribution within Nigeria
Once infrastructure improves, Nigeria is expected to become the luxury capital of Africa
Nigeria’s five largest cities are expected to each have consumer spending power equivalent to Mumbai by 2020 ($25B)
Three largest luxury brands purchased domestically are Moët – Hennessy, Amrapali Jewels, and Porsche
LVMH is doubling its marketing budget for champagne and liquor products in Nigeria
Bold, colorful prints are popular in Nigerian fashion and culture
High aspirational value for luxury brands in Nigeria
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Nigerian Luxury Market:
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Nigeria is the world’s fastest-growing champagne market, ahead of all emerging and developed countries
Nigeria is among the 20 largest buyers of champagne worldwide
Champagne is one of few luxury items that can be bought within Nigeria; most other luxury consumption is done abroad
2011 consumption was over $50M USD, expected to reach 1.1M liters by 2017
Market is driven by a status-conscious elite engaging in high levels of conspicuous consumption
Champagne is commonly served and expected at any upscale event
Nigerian champagne consumers are highly brand conscious: Moët Chandon has the most market share, followed by Veuve-Clicquot, Cristal, and Dom Pérignon
The middle class is now beginning to buy champagne as well for special occasions
Montaudon recently entered the Nigerian market and is looking to increase its visibility and sales
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Nigerian Champagne Market:
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Montaudon is a Champagne House founded in 1891 in Reims
Owned by the Montaudon family for four generations
Gained international popularity during the “Roaring-Twenties” era
Early endorsement deal with Josephine Baker, distributed to her cabaret shows in Paris
Brand is known by the red “M” logo
Montaudon was acquired by LVMH Moët Hennessy in 2008
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Montaudon Champagne:
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The brand offers six varieties for a broad range of tastes
Réserve Première Brut
Réserve Première Demi-Sec
Chardonnay Premier Cru
Brut Millesime 2002
Classe M Prestige Cuvée
Grande Rose
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Montaudon Champagne:
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Woodin:
Premium, fast-fashion African fashion brand with womenswear and menswear designs inspired by tribal prints, materials, and silhouettes
Started as a wholesale fabric company, but now has 23 prèt-a-porter boutiques across Ghana, Nigeria, Togo, Benin, Democratic Republic of Congo, and Cote d’Ivoire
Manufacturing operations are based in Ghana and Cote d’Ivoire, and employ 1,700 people
The brand is a part of the Dutch-owned Vlisco Group
All cotton is sourced from small and mid-size cotton plantations in sub-Saharan countries in an effort to further spur economic growth within Africa
Positioned as higher quality than Chinese imported products which now constitute the majority of mid-range and premium apparel available in West Africa
The brand’s end-to-end value chain remains on the African continent, from design to production to sale
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Montaudon, a French champagne brand and recent entrant to the fast-growing Nigerian champagne market, will launch a special-edition bottle of each of its six varieties in collaboration with Woodin, a West African premium fashion brand.
Woodin will design the box and bottle label for the special-edition bottles. They will be sold throughout Lagos, Nigeria’s wealthiest city.
Woodin has a high sustainability factor, as it is made within Africa and sources its materials from inside Africa
Once the champagne arrives into the content, the end to end value chain will remain in Africa, employing Africans
Proceeds will go towards development projects in Nigeria via Acción International.
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Product Concept:
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Global:
Nigeria:
Established Acción Microfinance Bank in Lagos in 2007
Provides vocational training and lending to Nigerian communities
Global microfinance institution
Provides lending and technical training
6.6M active borrowers in 2013
Active in 21 countries
Partnered with 29 banking institutions
$7.1B in active loans
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Acción International:
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Réserve Première Brut
Réserve Première Demi-SecChardonnay Premier Cru
Brut Millesime 2002
Classe M Prestige Cuvée
Grande Rose
Montaudon / Woodin Special Edition Bottles:
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The designs for packaging and labeling would be done in Ghana by the Woodin team
LVMH would manage the production of the champagne, bottling, and labeling
The special-edition Montaudon bottles would be launched in October, leading up to the Calabar Festival in December
Bottles would be sold to alcohol distributors who supply wine stores in Lagos
The box would be made from recycled cardboard and use minimal chemical additives and surface coatings
All profits will be donated to Acción’s vocational training programs in Nigeria
This will not be a money-making venture for Woodin and Montaudon, but rather a long-term investment to increase brand awareness in Nigeria that will lead to purchases of both brands
Each bottle will be designed to be an “object of desire” that customers will keep or re-use as a decorative object rather than disposing of it into landfills
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Production & Distribution Strategy:
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90% of manufactured glass is Soda-Lime Glass made from silica (sand)
Production Process:
1. Silica is combined several with other ingredients including:
•Sodium carbonate (soda): lowers the melting point•Calcium oxide (lime): along with magnesium oxide and
aluminum oxide, these ingredients reduce water solubility•Iron Oxide and Chromium: creates a green color
2. The batch is melted in a gas furnace
3. Bubbles are removed
5. Glass is blown and pressing into bottles
4. The surface is polished by pressurized nitrogen and coated Champagne bottle manufacturers in France have been working on slimming down the bottle in an effort to reduce its weight and decrease carbon emissions from transportation.
Sustainability Considerations: Use of lead and arsenic, waste management, water usage, and energy consumption
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Product Lifecycle Considerations: Glass
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After World War II, France focused on industrializing its agriculture to fuel rapid growth in output. This included champagne production, in which the use of GMO grapes, chemical fertilizers, and pesticides was encouraged. Overproduction began to erode the hills within the champagne growing regions, and insects started becoming immune to pesticides in the late 1990’s. The higher amounts of pesticides required to protect vineyards risked toxic contamination of the grapes.
In May 2014 the Champagne Bureau created a sustainability certification program called VDC (Viticulture Durable en Champagne). This is in addition to the French environmental certification program HVE (Haute Valeur Environmentale)
There are 125 criteria against which producers are evaluated during the VDC certification process. Certification takes three years, and requires audits every 18 months to maintain certification status
New standards of excellence include licensing requirements for the purchase of pesticides, using organic fertilizer, waste-water management, and re-introducing of grass into vineyards Most large champagne houses are HVE certified, including Moet & Chandon which owns Montaudon and the largest area of vineyards in Champagne. Many brands are now pursuing the VDC certification too.
Champagne Houses have expressed an interest in supporting the certification of their suppliers by paying a higher price for the grapes produced to VDC standards to offset the increased labor required to remain compliant.
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Product Lifecycle Considerations: Champagne
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Additional sustainable practices being adopted in the Champagne industry include:
Energy efficient refrigeration units
Tank-wrapping to save energy used to stabilize temperature
Electric forklifts in warehouse
Harvesting at night so less energy is needed to cool the grapes after picking
Composting discarded vines and organic matter, and using the compost as fertilizer
Installation of moisture monitors in soil so irrigation is only done when necessary
Drip irrigation instead of sprinklers
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Product Lifecycle Considerations: Champagne
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Works Cited“What will it take for Africa to join the global fashion system,” Business of Fashionhttp://www.businessoffashion.com/community/voices/discussions/what-will-it-take-for-africa-to-join-the-global-fashion-system/tapping-31-billion-africa-opportunity “Vlisco: The African Fashion Titan from Holland,” Business of Fashionhttp://www.businessoffashion.com/articles/global-currents/vlisco-the-african-fashion-titan-from-holland “Woodin Fashion,” Woodin Fashionhttp://www.woodinfashion.com “Montaudon Champagne,” Montaudon Champagnehttp://www.champagnemontaudon.com “Non Governmental Organizations (NGO) in Nigeria,” Nigeria Galleriahttp://www.nigeriagalleria.com/Agencies_and_Organizations/NGOs_b.html “Acción International,” Acción Internationalhttp://www.accion.org “Nigeria's love of champagne takes sales growth to second highest in world,” The Guardianhttp://www.theguardian.com/world/2013/may/08/nigeria-champagne-sales-growth-second-highest
“Nigerians’ Thirst for Champagne,” This Day Livehttp://www.thisdaylive.com/articles/nigerians-thirst-for-champagne/148171/ “Luxury Brands Target Nigeria As Boom Economy Creates New Class of Elite,” The Huffington Posthttp://www.huffingtonpost.com/2012/03/22/luxury-brands-nigeria_n_1372164.html “MFIs in Nigeria,” Microfinance Nigeriahttp://www.mixmarket.org/mfi/country/Nigeria
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