Jay-Z and Cristal

[Professor]

NEW YORK (AP) — A few weeks ago, Jay-Z announced he was boycotting Cristal at his clubs after the champagne company's president indicated that he wasn't thrilled about the brand's association with hip-hop culture — comments the rapper called "racist."

But what about the many other high-end brands whose names constantly appear in rap lyrics? Do they embrace the free publicity or cringe at it? It depends on which company you ask.

Mercedes-Benz — the most-mentioned brand in last year's top songs — says the car's popularity in hip-hop circles certainly didn't hurt sales growth over the last dozen years.

Cadillac, which lost some luster in the 1980s and '90s, credits its turnaround, in part, to the popularity of the Escalade among rappers and other celebrities. Moet Hennessy USA said the wine and liquor company was "thrilled" about its affiliation with hip-hop.

Bentley Motors and Louis Vuitton — also among the most name-checked brands in music — were more reticent on the subject.

While some companies may shy away from being associated with a culture often marked by misogyny and violence, it is undeniable that hip-hop wields immeasurable power and influence in business.

Aspirational in some respects and now synonymous with youth culture in many corners of the world, hip-hop has long been credited with — or criticized for — having an impact on everything from clothing to cars.

But periodically, hip-hop's chief arbiters — like Jay-Z — turn on brands because of slights, real or perceived, to the culture.

Pepsi agreed in 2003 to give $3 million to charity after Def Jam co-founder Russell Simmons threatened a boycott because the soda company dropped an endorsement deal with rapper Ludacris following complaints from conservative commentator Bill O'Reilly.

Designer Tommy Hilfiger was dogged for years by rumors that he didn't want minorities buying his clothes. His company, which denied the entire episode ever happened, never quite regained the same popularity in hip-hop.

Lucian James, an executive with a branding agency that tracks mentions of products in Billboard's Top 20, warned that in a fast-changing marketplace luxury brands in particular must capture relatively "new" customers while maintaining "traditional or old" customers.

James said Cristal put itself at serious risk of losing the new clientele because of the comments made by Frederic Rouzaud, the president and chief executive of Champagne Louis Roederer — a 230-year-old French company that makes the bubbly.

In a recent issue of The Economist magazine, Rouzaud said the company viewed the affection for its champagne from rappers and their fans with "curiosity and serenity."

Asked by the magazine if the association between Cristal and the "bling lifestyle" could be detrimental, Rouzaud replied:

"That's a good question, but what can we do? We can't forbid people from buying it. I'm sure Dom Perignon or Krug would be delighted to have their business."

Jay-Z, who has made numerous references to Cristal throughout his career, pulled the champagne from his sports lounges, where bottles sold for $450 and $600. And, at a concert this week at Radio City Music Hall, the Def Jam Recordings president omitted "Cristal" from some of his lyrics.

"What they don't seem to have been interested in is seeing the popularity of Cristal in hip-hop culture," James said of executives at Cristal, which ranked No. 8 in mentions in songs last year. James' company, Agenda Inc., compiles the list.

"I can't imagine Cristal recovering very quickly. It (hip-hop loyalists) was a huge part of their market," James said.

Noel Hankin, vice president of multicultural initiatives at Moet Hennessy USA, said his company, which markets Hennessy, Dom Perignon and Belvedere, among other drinks, said his company welcomes the association.

"We appreciate that business. We want it. It's critical to our business success," Hankin said. "We've never had any hesitation or reservation about embracing the hip-hop community."

Moet Hennessy has sponsored the televised Vibe Awards, where bottles of Moet were conspicuously visible on tables. Hennessy ranked No. 6 on Agenda's report.

Louis Vuitton, which tied with Cristal at No. 8 on the list, declined to comment on the association. So did No. 2 Nike.

John Crawford, a spokesman for Bentley Motors (No. 4) released a short statement that said in part that the company "believes that increased interest in the marque, from any quarter, is good for the brand as a whole."

An executive at Mercedes-Benz, part of DaimlerChrysler AG, viewed the attention from a business standpoint.

"Hip-hop is really a language of the younger generation and it's always great for a brand to be relevant with the younger or next generation of buyers," said Kass Dawson, who heads emerged markets at Mercedes-Benz.

"We consider it a compliment of the highest order," Dawson said, adding that Mercedes has sponsored events related to awards shows and hip-hop magazine parties. "It really speaks to what our brand stands for — the success, status, aspirations."

Cadillac spokesman Kevin Smith gave props to celebrities, including rappers, and their fondness for the Escalade for the company's resurgence. Cadillac has loaned vehicles for placement in videos and movies, he said. For the prototype of the 2007 Escalade, the company invited about 35 celebrities to an exclusive viewing.

Even Rouzaud, the executive atop the Cristal brand, seemed to realize the potential impact a boycott by hip-hop devotees would have on his bottom line.

After Jay-Z announced the boycott of Cristal, Rouzaud issued a statement to "set the record straight and express our gratitude that people from a diversity of cultures and countries have been enjoying our wine."

Rouzaud characterized Jay-Z's accusations as "unjust." Moreover, Rouzaud said, the company has been "a little bit dismayed at seeing our wine sprayed around in celebration instead of being savored in a glass," in reference to scenes in rap videos.

[sigmadiva]

Originally Posted by Professor

NEW YORK (AP) —

James said Cristal put itself at serious risk of losing the new clientele because of the comments made by Frederic Rouzaud, the president and chief executive of Champagne Louis Roederer — a 230-year-old French company that makes the bubbly.

Rouzaud characterized Jay-Z's accusations as "unjust." Moreover, Rouzaud said, the company has been "a little bit dismayed at seeing our wine sprayed around in celebration instead of being savored in a glass," in reference to scenes in rap videos.

My first thought at hearing this was . While I can see where hip-hop has strong impacts on lifestyles and marketing, I also think that a company that has been around for over 200 years has, and can survive very well without hip-hop. I think Jay-Z may have overreacted a bit. Rouzaud's company does not owe Jay-Z anything. Jay-Z uses the champagne because of his choice.

I think this situation points to a bigger problem in the Black community. We are very good at buying things, but we seem to lag behind in developing our own industries. The money that we do earn leaves our communities because we don't re-invest in our own communites. Then we want to get mad at other people becaue we think it is their fault that we can't keep up with them.

[SummerChild]

Sigmadiva,
I agree that we should have our own products and industries. One problem that AA producers and owners have is that we will make a whole list of EXCUSES as to why we won't patronize their business. I believe that there was a thread on Greekchat listing out many of these excuses. And we all know what excuses are but conveniently forget when it comes to patronizing AA businesses. So it is easy to say that we should have our own but we must also, as consumers, commit ourselves to going the extra mile to support the businesses (both the current and new businesses).

SC

Originally Posted by sigmadiva

My first thought at hearing this was . While I can see where hip-hop has strong impacts on lifestyles and marketing, I also think that a company that has been around for over 200 years has, and can survive very well without hip-hop. I think Jay-Z may have overreacted a bit. Rouzaud's company does not owe Jay-Z anything. Jay-Z uses the champagne because of his choice.

I think this situation points to a bigger problem in the Black community. We are very good at buying things, but we seem to lag behind in developing our own industries. The money that we do earn leaves our communities because we don't re-invest in our own communites. Then we want to get mad at other people becaue we think it is their fault that we can't keep up with them.

[sigmadiva]

^^^^^ Too true. That's the other part of it.

[nonchalant]

That's the way the cookie crumbles. I feel Jay-Z had the right to pull Cristal from his clubs just as much as Cristal's president had the right to make his comment. People should think before they speak. I'm sure Jay-Z's boycott will be successful among people in the rap community, especially the dynasty fam. However, Cristal has been doing fine for over 200 years, so I'm sure it won't have a great impact on the company.

[Pretty Kitty]

I never liked Cristal anyway... but I do take offense at a business man... shunning in any shape form or fashion.... business...
I think Jay- Z is doing the right thing...

[ZetaStorm]

I agree. I don't know any business owners who are willing to turn away money. Especially that much money. That's the whole purpose of you being in business. You can be in business for 200 years and still fold. Times change and people change. Just because you did well for 200 years doesn't mean you will have the same success the next 200 years or the next year for that matter. Anyone who knows anything about business and marketing knows about guerilla marketing. Basically you are always marketing your product. You never take for granted that you will stay on top. There is always someone around the corner who wants your place. A new beverage could come out and completely knock Cristal right out of the game. Although Delta Airlines hadn't been in business for 200 years still who would have thought they would have fallen off like they have? I agree that Jay-Z should pull the product. Myself I'm not one to beg anyone to take my money. If I'm in a store, etc. and the clerk or teller or whoever wants to act funky I will get my money back faster than a NY minute. It just doesn't make sense to continue to give your money to someone who obviously does not want your business.

[shinerbock]

I don't blame the Cristal guy. People should understand, this is this person's craft. Any time you create something and are proud of it, and it becomes associated with something different, you may end up disappointed. I also don't think it will have much impact on the company. Consider that probably the majority of people consuming Cristal before it became associated with hip-hop were white, and realistically probably still are. Also consider that despite its popularity within the hip hop community, the huge majority of hip hop fans probably never drink it, for the fact that they cannot afford it. Thus, its popularity within hip hop circles may have only marginally increased sales, and it probably lost some from within the wealthy white community. I imagine the sales remain about the same, and I imagine the loss in popularity would be just that, rather than a true decline in sales. Consider it also like this, if you order an extremely nice meal from a very good chef, and then you add to it, or salt it without tasting, the chef will be offended. If you're a designer, and you make very quality clothing, you may be disappointed to see kids wearing your pants down to their knees, shirts way too big, or any other way which you didnt really intend the clothing to be worn. Of course, if you buy the meal, or the champagne, or the clothing, you should be able to wear it or eat it or drink it however you wish. That being said, its still understandable that somebody who devotes their life to creating something, may not be fond of its popularity in a controversial world like that of hip-hop, especially if they don't retain the class of the item the way you had originally intended it.

[ZetaStorm]

I'm sorry but I have to break this down to dollars and sense (purposely not spelled cents). I am both a business owner (several businesses) as well as a PR Specialist. No matter how you dice it or slice it Cristal made a dummy move. If I was Cristal's #1 competitor I would be sitting in a meeting with Jay Z as we speak. I read the original article from The Economist magazine when this first broke. Anyone else that read it knows that none of the other companies would comment. You know why? They know that African Americans are the #1 consumers in America. They aren't crazy enough to open their mouth and say the wrong thing and damage their sales. They let the smoke settle and then they spoke.

I quote: Lucian James, an executive with a branding agency that tracks mentions of products in Billboard's Top 20, warned that in a fast-changing marketplace luxury brands in particular must capture relatively "new" customers while maintaining "traditional or old" customers.

And straight from the horses mouth or arse depending on how you want to view it......
Even Rouzaud, the executive atop the Cristal brand, seemed to realize the potential impact a boycott by hip-hop devotees would have on his bottom line. After Jay-Z announced the boycott of Cristal, Rouzaud issued a statement to "set the record straight and express our gratitude that people from a diversity of cultures and countries have been enjoying our wine."


^^^
You don't clean up unless you've messed up. In the business world this is called, trying to clean up some isht!

Rouzaud is a mess. What's hilarious to me is that The Economist magazine printed his statements as he actually spoke them which makes him sound like a fool. You're a top executive and these are your responses? Don't think that the interviewer for The Economist magazine didn't see an opportnity here. (Great PR for them. I bet their sales went up )Cristal is squirming, watch and see how fast they try to remedy this problem.

I have business partners (both black and white) who own multi million dollar companies and guess what? They all agree that Cristal messed up. Bad business move. Smart business owners know how to work with the hip hop industry not against it. The bottom line is that it is one of the TOP money grossing industries. (Not just in America but worldwide.) These hip hop fans are the same consumers who buy sneakers for $200, rims and sound systems in their cars for thousands of dollars (not to mention customize the entire vehicle), get their hair done for hundreds of dollars. So you think they can't buy Cristal? Think again. Cristal is a business first and foremost & they are not going to walk away from that big of a slice of a market. That's why they're trying to 'set the record straight.'

Don't believe me watch and see how this unfolds.......

[shinerbock]

I agree with you that the comments were not a good business move, but I doubt it will have the impact you seem to predict. As a luxury product with a very limited output, I doubt sales have increased for the company with the popularity in hip hop circles. It is not as though Cristal can simply increase production on the basis of popularity. I think the true people who would feel the financial burden are those in U.S. resale. If the demand decreases, the price they can get will obviously decrease. This will probably not create loss for the actual manufacturer, whose prices are most likely fairly consistent, and set with the basis of the much larger international market. I wonder then if the clubs may also lose money, as the mark up they can reasonably place on lesser champagnes will probably not reach the level of Cristal. This is not to lessen the impact hip hop culture has on the financial world, however. If Phil Knight had made a similar statement, Nike could indeed feel the hit. I imagine Nike would produce as many sneakers as people would buy, and thus a drop in demand would automatically equal a drop in sales. But Cristal is gonna produce and sell 300,000 cases a year, regardless of of a decrease in demand. With the demand decrease limited only to the U.S., I highly doubt Cristal will even have reason to reduce their price. Once again, not what you would call a wise business decision, but when you make a quality product, you can often be snobby without much financial consequence (like a very popular chef who only serves only so many people a night). Sorry if this seems to be stating the obvious regarding supply and demand, but when I post on here, I sometimes have to rationalize my arguments simply to keep my train of thought moving.

[Drolefille]

I thought it was interesting that before rappers, Cristal sold out, and after rappers they will continue to sell out. But one of the problems that Rouzaud mentioned was that he hated seeing his wine sprayed around in vidoes. These are people that consider their product a work of art in a way. Imagine going to a "top-tier" restaurant in NYC. One where you go to because of the chef inside. Then you start a food fight...

Harsh words are not all you will recieve.

[tunatartare]

This may have undoubtedly been a dumb business move, however, Rouzaud knows who Cristal's target clientele is, and is catering the product to them. Let's face it, if your product is targeted towards the older, republican, white country club crowd, most people like that are not going to care whether the champagne they're drinking has been mentioned in hip hop songs, in fact, that might turn them off from it if anything.

[SummerChild]

This is an interesting discussion.

ZetaStorm, as a business owner and PR Specialist, do you buy into the idea that perhaps the manufacturer of a product that is very expensive may need to limit it to what is seen by the public as *select circles* b/c this is how it maintains some of its value to those people - by being seen as something that only the creme de la creme indulge in? For example, it seems to me that many products are definitely not worth the mark up but the manufacturer can demand the price b/c those who are willing to fork over the $$ are doing so b/c it is seen as something that only the people that they perceive as the creme can afford it. For example, how good is Cristal really in terms of all of the factors that one uses to evaluate that type of product? Is JayZ talking about it in his rap songs b/c it is the smoothest, etc. or is he partly so high on it (or at least was) b/c it was seen as somethign that the everyday person cannot get? If the latter is the case, he is ironically basically a victim of the same kind of snobbery that he bought into himself only now he's seen as the everday person by the manufacturer perhaps.

All in all, I guess that I agree that it was stupid to make the comment out loud although I don't blame him for wincing when he sees someone spraying his product through the air in that manner if he feels that his product is the creme. I don't know if I would be able to appreciate non-traditional uses of my product if I had built part of its rep on being the drink of the sophistocates. However, there must have been a better way to handle it. As everyone in the corporate world knows, there are so many ways to screw a person w/out appearing to be doing so. One good thing might be that at least JayZ *knows* that this man doesn't really value him and his business and he can take it elsewhere. What if the man had been saavy enough to continue to keep quiet and JayZ just kept giving him his money.



SC

Originally Posted by ZetaStorm

I'm sorry but I have to break this down to dollars and sense (purposely not spelled cents). I am both a business owner (several businesses) as well as a PR Specialist. No matter how you dice it or slice it Cristal made a dummy move. If I was Cristal's #1 competitor I would be sitting in a meeting with Jay Z as we speak. I read the original article from The Economist magazine when this first broke. Anyone else that read it knows that none of the other companies would comment. You know why? They know that African Americans are the #1 consumers in America. They aren't crazy enough to open their mouth and say the wrong thing and damage their sales. They let the smoke settle and then they spoke.

I quote: Lucian James, an executive with a branding agency that tracks mentions of products in Billboard's Top 20, warned that in a fast-changing marketplace luxury brands in particular must capture relatively "new" customers while maintaining "traditional or old" customers.

And straight from the horses mouth or arse depending on how you want to view it......
Even Rouzaud, the executive atop the Cristal brand, seemed to realize the potential impact a boycott by hip-hop devotees would have on his bottom line. After Jay-Z announced the boycott of Cristal, Rouzaud issued a statement to "set the record straight and express our gratitude that people from a diversity of cultures and countries have been enjoying our wine."


^^^
You don't clean up unless you've messed up. In the business world this is called, trying to clean up some isht!

Rouzaud is a mess. What's hilarious to me is that The Economist magazine printed his statements as he actually spoke them which makes him sound like a fool. You're a top executive and these are your responses? Don't think that the interviewer for The Economist magazine didn't see an opportnity here. (Great PR for them. I bet their sales went up )Cristal is squirming, watch and see how fast they try to remedy this problem.

I have business partners (both black and white) who own multi million dollar companies and guess what? They all agree that Cristal messed up. Bad business move. Smart business owners know how to work with the hip hop industry not against it. The bottom line is that it is one of the TOP money grossing industries. (Not just in America but worldwide.) These hip hop fans are the same consumers who buy sneakers for $200, rims and sound systems in their cars for thousands of dollars (not to mention customize the entire vehicle), get their hair done for hundreds of dollars. So you think they can't buy Cristal? Think again. Cristal is a business first and foremost & they are not going to walk away from that big of a slice of a market. That's why they're trying to 'set the record straight.'

Don't believe me watch and see how this unfolds.......

[tunatartare]

Originally Posted by SummerChild

This is an interesting discussion.

ZetaStorm, as a business owner and PR Specialist, do you buy into the idea that perhaps the manufacturer of a product that is very expensive may need to limit it to what is seen by the public as *select circles* b/c this is how it maintains some of its value to those people - by being seen as something that only the creme de la creme indulge in? For example, it seems to me that many products are definitely not worth the mark up but the manufacturer can demand the price b/c those who are willing to fork over the $$ are doing so b/c it is seen as something that only the people that they perceive as the creme can afford it. For example, how good is Cristal really in terms of all of the factors that one uses to evaluate that type of product? Is JayZ talking about it in his rap songs b/c it is the smoothest, etc. or is he partly so high on it (or at least was) b/c it was seen as somethign that the everyday person cannot get? If the latter is the case, he is ironically basically a victim of the same kind of snobbery that he bought into himself only now he's seen as the everday person by the manufacturer perhaps.

All in all, I guess that I agree that it was stupid to make the comment out loud although I don't blame him for wincing when he sees someone spraying his product through the air in that manner if he feels that his product is the creme. I don't know if I would be able to appreciate non-traditional uses of my product if I had built part of its rep on being the drink of the sophistocates. However, there must have been a better way to handle it. As everyone in the corporate world knows, there are so many ways to screw a person w/out appearing to be doing so. One good thing might be that at least JayZ *knows* that this man doesn't really value him and his business and he can take it elsewhere. What if the man had been saavy enough to continue to keep quiet and JayZ just kept giving him his money.



SC

I think that Jay-Z mentioned it in his songs because of it's eliteness and snob appeal. Many brands and products that are mentioned in hip hop songs are done so because of their position as being a status symbol: Cristal, Burberry, chinchilla, etc.

[ZetaStorm]

Summerchild you've got it. That's pretty much it in a nutshell.

One of my businesses does cater to elite consumers however my definition of elite is not necessarily being a country club member but someone who prefers the best that life has to offer. I have customers who are all different races and from all different backgrounds. These 'rappers' and so called hip hop consumers are some of my best customers because they do prefer quality and they are loyal customers. If they like your product they will only buy from you. A loyal customer is the best customer to have.

Personally I don't buy into the fact that the problem with Cristal is that 'rappers' are pouring their beverage out. Because if that was the case why are we just hearing about this? Is this how Cristal conducts business and just who do they consider the 'elite' to be? I mean hayle how many years has artists been pouring out Cristal? He even had the audacity to name other businesses who probably would be glad to have these artist's business. His comments were - But what can you do? Let's see, you can contact the artists and try and come to some type of compromise or at least have a conversation IF you valued their business.

Just like you said Cristal does view Jay-Z (and others like him) as the everyday person, however he isn't. This is where the impact is going to come from. Sure you can cater your product to a certain clientele however you really don't have any control over who purchases your product. As someone mentioned they sold out before these 'rappers' and will sell out after them. Really? Well Cristal has already stated that a boycott will effect their sales. It amazes me how some businesses still don't get it. See this is just it. Jay-Z is not just 'some rapper' he is a business owner and a multi millionaire as well.

One of my business partners said something very interesting today. OK Cristal has been in business for 200 years. How old is Jay-Z? How long did it take for him to acquire a fortune? He's basically on the same level with you and he did it in a much shorter time frame. Who knows where he will be in 10-15 years? How does Cristal know that their paths won't cross again? It's not good to burn bridges.

Personally, I"m glad that Cristal voiced their thoughts because now we all know where they stand. They don't need to set the record straight. The record is already straight. As stated in earlier posts this should be a lesson to Jay-Z and AA in general. Support your own businesses, create your own businesses and always demand respect from any business that you deal with. If you hate me behind my back that's one thing because I don't know but I'm certainly not going to give you my money when you've told me to my face that you don't want my business.