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Posted January 20, 2007 by publisher in Cuba-World Trade

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By Doreen Hemlock | Sun Sentinel

The restaurant serves chicken with rum sauce. In the courtyard, a bartender whips up a new cocktail: fresh-squeezed sugar cane and orange juices with white rum. The guided tour concludes with a tasting, complete with the finest blends.

Tourists flock daily to the Havana Club Rum Museum in this Caribbean capital, just one plank in an aggressive marketing push that has made the government-backed brand Cuba’s top selling rum and a rising star worldwide.

Sales are so brisk that industry tracker the IWSR of London just named the brand the fastest growing internationally in the decade ended 2005. Havana Club sales jumped 16.4 percent a year during the period, reaching 2.6 million cases in 2005, the ISWR said in its latest Elite Brands List. A case has nine liters.

“If you consider that Havana Club is excluded from the United States, due to a trademark dispute and the Cuban embargo, the brand’s performance is even more impressive,” the ISWR said in the Elite Brands report. The United States is the world’s biggest market.

Within Cuba, Havana Club dominates rum sales, its growth closely linked to the surge in tourism, now topping 2 million visitors a year.

But it’s in Europe where the brand is making its biggest inroads and now ranks No. 2 among all rums, the company said.

Growth stems partly from a marketing campaign that associates Havana Club with Cuba’s vibrant music and culture.

“More and more people in Europe are dancing salsa and cha-cha these days, so that’s helping Havana Club sell,” said Portuguese tourist Artur Santos, 39, during a visit with his family to the rum museum.

Havana Club said it ranks as the top-selling liquor in Italy, outpacing Bermuda-based rum rival Bacardi Corp. and all other types of spirits. The brand also is strong in Spain and growing fast in Germany.

Sales worldwide likely topped $200 million in 2006, with profits up to 20 percent, industry analysts said.

Key to the success is the 1993 joint venture between Cuba’s government and France’s liquor giant Pernod-Ricard to market the brand internationally, though not in the United States. Sales are banned to the U.S. market because of Washington’s decades-old economic embargo against communist-run Cuba.

The partnership lets Havana Club tap Pernod-Ricard’s distribution network and its marketing savvy worldwide. Together, the duo has boosted Havana Club sales to more than 120 nations. New marketing approaches run the gamut: the rum museum, the International Cocktail Grand Prix, held every two years in Havana, and master classes on rum taught overseas to thousands of bartenders.

Still, exclusion from the vast U.S. market and a late start in international marketing has hurt.

Bacardi sold about eight times as much rum as Havana Club in 2005, with nearly half of Bacardi’s sales in the United States. That made Bacardi No. 1 among world rum suppliers, compared to a distant No. 7 for Havana Club, the IWSR said.

Bacardi also is staking a claim to the Havana Club name in the United States, now selling a clear rum made in Puerto Rico as its own “Havana Club” in Florida and waging a legal dispute with Cuba over the trademark in U.S. courts.

Far from the court battle, tour guide Osvaldo Mandina, 38, focused on the history and process of rum-making as he walked visitors through the Rum Museum one afternoon.

He cited the 1600s and 1700s when sugar cane was king—before the advent of beet sugar and other sweeteners.

“Sugar was like oil today,” said Mandina, “the most important commodity.”

He showed off a model of a sugar mill town—complete with moving trains; and pointed to rows of oak barrels, where rum is aged before blending and bottling. Some 6 percent of every barrel evaporates yearly during aging—“the angels’ share,” he said.

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  1. Follow up post #1 added on March 29, 2007 by Stephen


    Cuba’s Havana Club rum brand sold a record 2.6 million cases last year (2006), fueled by a 30 percent sales surge in the island’s domestic market, company officials said Wednesday.

    Enrique Noste, Havana Club’s director of marketing for Cuba, said the company’s rums now rank 34th out of the world’s 100 top-selling spirits. He did not provide overall sales figures for 2005 (in fact it was 2.32 million cases), but said the company topped the 2 million-case mark for the first time in 2004, while selling barely 1 million in 1998 and just 460,000 in 1994.

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