Château Ksara is the best selling wine in
the Middle East. In Lebanon, it can claim nearly
45% of local off-trade sales and 30% of the total
wine market (including foreign wines). Abroad, Château
Ksara has consistently taken the lion’s share of
Lebanese wine exports, and in 2005, secured an impressive
40.5% (roughly 1 million bottles) share of all Lebanese
wines sold abroad, a 16% year-on-year increase of
its foreign sales.
Syria
and the UK were the main growth markets with year-on-year
growth of 50% and 30% respectively. Reserve de Couvent,
Château Ksara’s mid-priced red, once again
proved to be the motor behind the export surge,
making up 38% of all Château Ksara’s international
sales.
Today,
Chateau Ksara’s reputation as Lebanon’s biggest
and oldest winery is secure. To produce its 2.2
million bottles, the winery harvests 2,000 tons
of grapes from its 300 hectares at an average yield
of 7 tons of grapes per hectare. This is nearly
half the yield of some new world producers who,
foregoing quality, happily harvest as much as 14
tons per hectare. For Château Ksara, quality
is paramount.
All this
has been achieved by excellent management, a solid
corporate infrastructure and regular reinvestment
– on average $500,000 every year since 1991. Château
Ksara’s announcement that it will increase production
to 2.7 million bottles over the next three years
cannot come soon enough. The winery sells all the
wines it makes and for some labels, especially for
the Reserve du Couvent and the Chardonnay Cuvée
du Pape, demand is exceeding supply.
Achievements
Château Ksara is making steady inroads into
new markets nowhere has this impact been felt than
in the UK, the biggest importer of Lebanese wines.
Its $14 billion wine market is intensely competitive,
but Lebanon, which only produces 6.5 million bottles
a year, can exploit its tiny output by positioning
its wines as high-quality, sought-after boutique
products. This has been done to stunning effect
by Château Ksara, which has seen remarkable
growth – 80% in 2006 alone – in its UK sales Currently
its fourth biggest market, Château Ksara believes
the UK will eventually take the top slot, overtaking
Syria, France and the US. Other markets in which
Château Ksara has performed strongly include
Germany, Finland, Sweden, Egypt and Jordan and Canada,
where it was the first Lebanese wine to be sold.
In all, Château Ksara can be found in over
30 countries.
Success
has been achieved by understanding the importance
of strategic alliances with professionals who understand
their market. In the UK especially, Château
Ksara has demonstrated that by joining forces with
an established and respected distributor – in this
case the House of Halgarten – it is possible for
a small producer to thrive in what is arguably the
most competitive wine market in the world.
Château
Ksara was the first Lebanese winery to introduce
“modern” grape varietals – Cabernet Sauvignon, Syrah,
Merlot, Chardonnay et al – into Lebanon in the early
90s, eschewing the sector’s traditional reliance
on less fashionable grapes such as Cinsault and
Carignan. Today, its vineyards are home to some
20 varieties of grapes for the production of red,
white, rosé wines, vin doux (sweet wine)
and arak.
In 1994,
Château Ksara was also the first to enter
into long-term rental agreements with Bekaa landowners
who were also encouraged plant better quality grapes.
This move has influenced the way many of Lebanon’s
producers now farm their own grapes and has contributed
to an overall improvement in the quality of Lebanese
wine.
History
Château Ksara began life in 1857, when Jesuit
brothers inherited and began farming a 25 ha plot
of land to produce Lebanon’s first non-sweet red
wine. In doing so, they laid the foundations of
Lebanon’s modern wine industry.
It is
worth remembering however that Lebanon’s oldest
winery is merely continuing a 5,000-year-old trading
tradition. Lebanon sits on the site of ancient Phoenicia,
one of the world’s oldest merchant civilizations
and one of the first to sell its wines to other
nations.
At the
end of World War I, France was mandated to govern
Lebanon. Its military and administrative machine
moved in, bringing with it thousands of French soldiers
and civil servants, for whom wine was an integral
part of their culture. Ksara was in a position to
supply Lebanon’s new administrators and by the time
the French left in 1946, Lebanon had embraced the
Francophone experience with a passion that can still
be felt today. During the next 30 years, Ksara maintained
its position as Lebanon’s most popular wine as Lebanon
grew into a cosmopolitan and convivial hub, where
western tastes were eagerly adopted.
In 1972,
the Vatican encouraged its monasteries and missions
around the world to sell off any commercial activities.
By then, Ksara was a profitable entity, producing
over 1 million bottles annually and representing
85% of Lebanese production. When then order to sell
came through, the winery was optioned to a consortium
of Lebanese businessmen and in August, 1973 was
sold for $3.2 million.
During
the 1975-90 civil not one harvest was missed, even
in 1982, the year of the Israeli invasion. Nonetheless,
conflict flared up at random across the country
at sporadic intervals. Not knowing where the next
round of fighting would occur, Château Ksara
was forced to rethink its entire distribution strategy.
Understandably, exporting was also difficult, but
the company was nonetheless able to meet its obligations,
sending 15-20% of its production abroad, mainly
to France.
But the
longer the war dragged on, the more the company
began to feel the strain. When the guns fell silent
in 1990, Ksara had lost a significant chunk of its
local market share. Zafer Chaoui, who was appointed
chairman in 1991, had a vision and that same year
the flamboyant businessman, backed by an aggressive
board of directors, appointed a new Managing Director
and made more funds available. He did not know it
then but he had set in motion of one of the most
remarkable corporate turnarounds in Lebanese business
history.
Products
Today, Château Ksara sells 16 wines and eaux
de vie. Despite the undeniable level of innovation,
the focus is increasingly on the premium range of
wines and Chaoui has made it clear that he would
like to eventually see a greater concentration on
this niche, one in which there are higher margins
and better opportunities to build brand equity in
an increasingly competitive global wine market.
Château
Ksara produces three reds: Prieuré de Ksara,
the entry-level but nonetheless high quality wine
made from Cinsault, Syrah and Cabernet Sauvignon,
Cuvée de Printemps a fruity, summer blend
of Gamay and Tempranillo, and the mid-priced Réserve
du Couvent, a medium to full-bodied wine made from
Cabernet Sauvignon, Syrah and Cabernet Franc and
aged in oak for six months. It is Château
Ksara’s best-seller with a price-to-quality ratio
that would be hard to find anywhere in the world.
At the
top end are the premium reds: Château Ksara,
made from Cabernet Sauvignon, Merlot and Petit Verdot;
the single varietal Cabernet Sauvignon and the Cuvée
de Troisième Millénaire, Cinsault,
Syrah and Cabernet Sauvignon flagship red and a
blend Cabernet Sauvignon and Verdot. For its 150th
anniversary in 2007, Château Ksara has created
Le Souverin, a limited edition blend of Cabernet
Sauvignon and Arinarnoa aged in oak for two years,
to celebrate the occasion.
The whites
include L'Observatoire de Ksara, a light and fruity
wine made from Sauvignon Blanc, Muscat and Clairette;
Blanc de Blancs made from Sauvignon Blanc, Sémillon
and Chardonnay and finally Lebanon’s first single
varietal Chardonnay Cuvée du Pape, made with
grapes grown at Ksara’s highest (1,400 meters) vineyard
and harvested at a low (6 tons per hectare) yield.
There
are three Rosés: Gris de Gris, Rosé
de Ksara and Sunset. All have excellent acidity
and fresh, fruity aromas.
Château
Ksara also makes Moscatel, an excellent pudding
wine and Ksarak (Note to editor: this is correct
spelling), the country’s bestselling premium arak,
an aniseed drink similar to ouzo and raki. Finally,
there is a limited quantity of Eau de Vie. Bottled
in 1998 and made from two superb vintages – 1937
and 1945 – it rivals the finest cognacs.
Recent
developments
Château Ksara is in the midst of a $7.5 million
expansion program, which includes a new, $500,000
tasting room, $4 million spent on new equipment
and another $3 million on 75 ha of new vineyards.
The ambition is to increase production by 700,000
bottles, taking the annual production to 2.7 million
bottles by 2010.
To commemorate
its 150th birthday in 2007, Château Ksara
has written an official history, produced a documentary
film and is holding a three-day celebration for
foreign representatives, diplomats, and the world’s
leading wine writers. The events will consolidate
Château Ksara’s position as the country’s
most respected winery as well as cement Lebanon’s
position as an important wine producing nation.
Promotions
Château Ksara has always sought to strengthen
relations with its retailers and the end users.
Since the mid-90s, the winery sensed that while
there was an enthusiasm for wine in the Lebanese
market, there was also a lack of knowledge. To counter
this, Château Ksara organised theme nights
and wine seminars that have led to greater awareness
and brand building. Château Ksara was also
the first producer to respond to Lebanon’s supermarket
revolution in the late 90s in terms of display and
point-of-sale tastings.
Château
Ksara has had a long and illustrious tradition of
innovative advertising, a strategy it has always
maintained has been crucial in image building. As
far back as the early 90s, it has set new standards:
Château Ksara’s television ad for Ksarak is
widely held up as one of the best Lebanese short
films in modern times. Shot in the Bekaa Valley,
it captures all that is good about rural Lebanon
and, with its young-couple-in-love motif, positioned
the company as a traditional product that hinted
at an idyllic past.
In 2001,
Château Ksara worked with H&C Leo Burnett
to create an innovative ad campaign that would reflect
the winery’s innovative spirit and one that would
make people aware of the endless opportunities that
wine affords – with all food, all-year-round and
on all occasions. The award-winning campaign, which
uses the wine cork as the thematic motif, has been
a massive success and has once again consolidated
Château Ksara’s position as Lebanon’s leading
producer and the choice of the Lebanese wine devotee.
These
campaigns, as well as the introduction of exciting
and appealing new labels and an extraordinarily
competitive price to quality ratio, has led to improved
brand perception across the whole Château
Ksara range, especially the entry level wines such
as Prieuré de Ksara and L'Observatoire de
Ksara.
Brand
values
The name of Château Ksara dates back to 1857,
and has become associated with the three core values:
tradition, nobility and modernity. These are emphasized
through name and lineage (tradition); through a
high-quality product (nobility) and the tremendous
innovative advances made since 1991 (modernity).
Today, Château Ksara has positioned itself
as an old company with a young and dynamic spirit.
It produces some of Lebanon’s finest wines, invests
in state-of-the-art equipment and recruits and trains
the best human resources to ensure its products
are sold in as many countries to as many satisfied
consumers as is possible.
Things
you didn’t know about Château Ksara
• L'Observatoire
de Ksara is named after the Middle East’s first
observatory that was established at Château
Ksara in 1902 by the Jesuits.
• Château
Ksara’s has a 2 kilometres network of ancient Roman
cellars that provide ideal conditions for the ageing
of wines.
• Château
Ksara receives over 40,000 visitors a year at its
winery in Lebanon’s Bekaa valley.
• Château
Ksara achieved ISO 94 certification in 2001 and
ISO 2000 certification 2003
•
Elie Maamari, Château Ksara’s export manager,
began his career as an accountant at the winery.
Today, he is a distinguished enologist and a Chevalier
d’Ordre du Mérite Agricole for services to
wine.
Michael Karam has lived in Lebanon since 1992.
He is a business journalist and wine writer. His
articles have appeared in Decanter, Harpers Wine
Weekly and the Spectator. He is a contributor to
the award-winning Wine Report (Dorling Kindersley)
and the Oxford Companion to Wine (Oxford University
Press). He is author of Wines of Lebanon (Saqi),
which won the Gourmand Award for the Best New World
Wine Book 2005; Chateau Ksara: 150 years of wine
making 1957-2007 and Arak and Mezze: The Taste of
Lebanon (Saqi), which will be published in 2007.
NOTE
TO EDITOR: Please credit all photos - except vintage
archive shot of Jesuit winemakers (Chateau Ksara
Private Collection), vintage label (Chateau Ksara
Private Collection) and author shot (no credit)
- to Norbert Schiller/Focusmideast
