Jay-Z's champagne moment

When hip-hop megastar Jay-Z announced that he was boycotting Cristal over a perceived race slur, the elite champagne houses of France held their breath. Rather than any damage to the industry's reputation, the key question was to which prestige fizz – from Dom Perignon to Krug – the king of bling would switch his allegiance?

The answer was as unexpected as it was gaudy. In the viticultural equivalent of a coup d'etat, the multimillionaire musician and vinophile singled out a previously unknown champagne to be blessed with a lucrative appearance in his next video. Called Armand de Brignac, it was suitably far from understated – a metallic gold bottle adorned with a large pressed pewter label in the shape of an ace of spades.

At a mere £250 a bottle, the new arrival on the select stage of the "prestige cuvées", the highest quality champagnes, meets all the criteria to enter the £350m global market for the sort of look-at-me bubbly drunk by Russian plutocrats, Bond villains and A-list celebrities: it is rare, eye-catching and reassuringly expensive.

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The fact that few beyond the Hollywood party circuit and the inner sanctums of top-end nightclubs or Michelin-starred restaurants had ever heard of the new pretender only added to its allure.

Just 36 months since it first appeared, Armand De Brignac will mark its success in muscling in on some of the hardest-fought turf in the £3bn global champagne business by selling out its entire production run of 60,000 bottles.

But far from being the latest marketing coup of a luxury goods combine such as Louis Vuitton Moët Hennessy, the owner of Dom Perignon and Krug, the champagne being referred to in the drinking holes of the super-rich as "Ace of Spades" is the brainchild of a small, largely unknown producer that employs just 20 people in a quiet village far from the palatial châteaux of the likes of Bollinger and Veuve Cliquot, or indeed the kitsch bump and grind of a hip-hop video.

Based in a modest farmhouse in the village of Chigny Les Roses, south of Reims, the Cattier family have supplied grapes to the champagne trade since 1763 but only started producing their own bottles in 1918, making them relative newcomers in an industry that dates back to the 1680s.

The sleepy community is surrounded by rows of painstakingly tended chardonnay, pinot noir and pinot meunier vines that help produce some of the 322.2 million bottles of champagne sold around the world last year. The vineyards are interspersed with fields of arable crops, an indication that residents cannot live by the proceeds from grapes alone.

It was in this context that Jean-Jacques Cattier, the third-generation president of the family firm, decided to start work on a product that would compete on the same historic playing field as Cristal, a marque invented by Louis Roederer for Tsar Alexander II of Russia in a clear cut-glass bottle to reduce the risk of poisoning; Krug, which sells for up to £3,000 a bottle, and Dom Perignon, named after the monk credited with inventing la méthode champenoise.

Standing in the gloom of the kilometre of cellars buried 30 metres underground, where up to a million bottles of Cattier champagne are maturing at any one time, M. Cattier said: "We wanted to try something a little different. To put our very best wine, from our very best grapes, in a bottle and present it in the best way possible. We truly did not have a specific target customer. We could not imagine the success we have had."

The journey from the Cattier cellars, where smoke stains remain on the brick walls from the candles that lit the vaults when they were being used as bomb shelters during the Second World War, to the elite ice buckets of Los Angeles and London, began some 60 years ago.

Where competitors can allude to centuries of tradition with Tsars and Benedictine monks, the origins of Armand De Brignac lie with M. Cattier's mother, Nelly, who was reading a romantic novel while looking for the name of a new brand of champagne. The dashing hero of the 1950s book was called De Brignac and the cuvée was duly registered with champagne's governing body.

The name remained dormant until 2003 when Cattier began the final stages of developing its secret weapon by opting for one of the most garish bottles in a market crowded with more restrained competitors. Philippe Bienvenu, commercial director, said: "Certainly it is eye-catching but if we wanted Armand De Brignac to be a success then it had to be eye-catching. We are a boutique company. We don't have a marketing department or a huge marketing budget."

Given such restrictions, it is possible that Armand De Brignac may have once more disappeared into obscurity were it not for the intervention of fate – and a spot of slick promotional footwork – after Jay-Z, aka Shawn Carter, fell out spectacularly with Louis Roederer, the champagne house which makes Cristal.

Frederic Rouzaud, Roederer's managing director, was asked The Economist in 2006 whether his most lucrative brand's association with hip-hop artists, whose celebrity endorsement had already sent sales of Courvoisier cognac soaring, was detrimental to its image. He replied: "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 declared that he considered the remark racist and was boycotting all Roederer products. Mr Bienvenu explained that the Grammy-winning musician, who has an extensive wine collection, had previously bought a bottle of Armand De Brignac and chose, coincidentally, to feature it in the video for "Show Me What You Got", a song released in October 2006.

In the obscure world of champagne product placement, it is often difficult to tell where marketing ends and good fortune begins. But the effect of the Jay-Z mark of approval was electric. With the help of an American sales agent, Ace of Spades was soon appearing on the lips of celebrities from George Clooney to David Beckham, as well as in the gift bags of Oscar nominees.

The company, which has also started selling a rose and "blanc de blancs" version of Armand De Brignac, insists demand is so high that it could sell its annual production run "several times" over. It will reach its maximum production of 82,000 within three years.

The question remains of whether the wine inside Armand De Brignac's glitzy bottle, or indeed that of its competitors, is worth the large sums that their monied fans pay for them. As one food writer put it, ultra-expensive champagnes "are meant for those who believe that air pumped into your tyres by a liveried footman gives your car a better ride".

Paul Medder, senior project manager at market research company Wine Intelligence, said: "At this end of the champagne market, it is all about quality. You will be very quickly found out if you don't have that quality. It is a very, very niche market."

In a backroom workshop, Cattier employs three women whose sole job is to glue the pewter labels on the Ace of Spades champagne before hand-polishing each bottle and placing it in a black laquered box. Mr Cattier said: "We are not making an industrial product. This is about taking the most care you can with something. I think my mother would be proud."