Jay-Z and LVMH LVMUY 0.53% Moët Hennessy Louis Vuitton SE joins forces in the Champagne business and further cements the alliance between the hip-hop and luxury worlds as the Covid-19 pandemic saps sale of the party wine worldwide.
LVMH, the world’s largest champagne producer, has taken 50% of the shares in Armand de Brignac, the advanced Champagne brand owned by Jay-Z, the rapper and mogul. The brand, one of the youngest in the famous sparkling wine region, is known for its metallic bottles that cost hundreds of dollars each.
The investment, LVMH and Jay-Z said, aims to expand Armand de Brignac through LVMH’s global distribution network while drawing on the conglomerate’s resources within the Champagne wine country. It comes at a difficult time for Champagne: The pandemic caused the cancellation of weddings, soirees and other occasions to burst the curves, reducing sales of the wine by approx. 20% last year. The two sides did not reveal the value of the transaction.
“We worked hard to maintain a brand that grew faster than the staff we had and that was greater than any of the expertise we had,” Jay-Z, born Shawn Carter, said in an interview. “We had been in this 15 years, not a hundred.”
The partnership shows how European luxury brands are now embracing black artists and hip-hop culture to appeal to a younger and more diverse clientele. Rihanna and LVMH launched a cosmetics line, Fenty Beauty. The rapper Gucci Mane and the Italian fashion house Gucci have collaborated on a collection. Dior, an LVMH brand, has used rapper A $ AP Rocky as a select model in several collections of menswear. Streetwear has become a staple of luxury fashion.
“I think people have come to accept that these two worlds fit naturally,” Jay-Z said. “In the beginning, it was not a natural fit.”
Rappers have long peppered their texts with references to Dior, Louis Vuitton, Dom Pérignon and other brands. But until recently, the luxury industry kept its fans in hip hop at a distance. Such a perceived snub pushed Jay-Z to invest in Armand de Brignac.
Since emerging as a star in the 1990s, the Brooklyn-born rapper had been a devotee of Cristal and repeatedly named the advanced Champagne brand in his rhymes. That changed when a director of Crystal’s parent company in 2006 was asked in The Economist if the brand would be harmed by its affiliation with rap. “That’s a good question, but what can we do?” He answered.
Jay-Z soon organized a boycott of Cristal. Later in 2006, in the video for the single “Show Me What You Got”, he proclaimed a new brand: Armand de Brignac, who called himself “Spade-ace” and was launched earlier that year in the Champagne town of Chigny-les-Roses. The brand quickly issued a press release highlighting the mention.
Jay-Z was one of the early investors in Armand de Brignac, and in 2014 he bought his partner, the spirits company Sovereign Brands. The Champagne brand is one of several companies in the rapper portfolio, which also includes the talent agency Roc Nation and D’Ussé Cognac. Last month, he announced the launch of a fund to invest in minority-owned cannabis startups.
In Armand de Brignac, LVMH saw a brand that quickly drew new champagne drinkers to the advanced market segment, said Philippe Schaus, head of Moët Hennessy, LVMH’s liquor department. “The bottle has a much more modern and bold design,” Schaus said. “The way it was distributed – a lot of word of mouth. Jay-Z was not really obvious, but you felt that something was happening behind the scenes, which made the brand work in a different way than other brands. ”
Armand de Brignac is produced by a small team inside the Cattier Champagne house, a family-run brand. Sir. Schaus said LVMH’s resources in Champagne – it owns about 4,000 hectares of vineyards in the area – would likely be harnessed to increase the brand’s volume in the coming years.
The deal arose from discussions started between Jay-Z and Alexandre Arnault, the 28-year-old son of French billionaire Bernard Arnault, LVMH’s CEO and controlling shareholder. Jay-Z said he first met Alexandre a number of years ago in Paris on a trip with Kanye West. The deal advanced further after Bernard and Alexandre Arnault and Schaus met with Jay-Z several times at his home in Los Angeles, most recently this summer.
Jay-Z said he expects to collaborate with LVMH on other projects in the future. The luxury attraction of rappers, he said, comes from the desire to celebrate after surviving the despair in the inner city.
“If you put yourself in the shoes of people who come from these neighborhoods, you can understand why someone who – five of their six friends have passed away – would want to celebrate life,” Jay-Z said. “We connect with things that are well made and things that survive.”
Write to Matthew Dalton at [email protected]
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