Fine Wines in the Emirates – In Conversation with Oliver Dixon
Picture by Roman Logov on Unsplash
Oliver Dixon is Head of Fine Wine at MMI (Maritime and Mercantile International), a subsidiary of Emirates Group. Headquartered in Dubai, it is the number one beverage distributor in UAE and Oman, supplies duty free retailers and has 17 retail stores. He spoke with ARENI and shares his insights on the local Fine Wine market and his consumers profiles.
ARENI
Does your company have a clear-cut definition of what constitutes a fine wine?
Oliver Dixon:
I don’t think there’s a clear-cut definition. For us, fine wine is a wine that can have a secondary market. It is generally more expensive and the production is finite every year. It changes with the vintage.
ARENI
How do you organize yourself?
Oliver Dixon:
We have two teams and the fine wine team looks after anything that would be 15€ on release. We work with small demand growers and the producers with the top reputations.
ARENI
What’s the market situation in the Emirates? How would you describe your fine wine portfolio and how big is the Fine Wine market?
Oliver Dixon:
It’s probably no more than 10% of the total wine market. We invest a lot into stock and we invest in people, whereas for a lot of other companies it’s just an add-on.
There is a market for value wines, which is partly price led, but it’s also because residents who purchase from the MMI retail shop need to have a valid personal liquor license with a monthy purchase limit
There is probably more consumption of alcohol in bars and restaurants. It accounts for about 70-75% of the sales within the Emirate of Dubai.
As a tourist, if you have your passport, you can go into an MMI shop and buy alcohol. . When they travel through the airport, people typically stock up on alcohol at duty free. We have Le Clos boutiques throughout arrivals and departures at Dubai International airport (DXB), which have an outstanding range of fines wines as well as luxury spirits. Le Clos has been a very good source of fine wine revenue for us; it’s about the same revenue as we get from selling fine wine through the restaurants and hotels.
ARENI
Do you sell to private consumers as well? Do you have direct sales to private consumers and can you sell online?
Oliver Dixon:
Le Clos offers a click and collect service, where customers can order online and collect the next time they travel through DXB. Customers who are not travelling through DXB can also order online via Al Hamra Cellar, our warehouse style shop in Ras al Khaimah and collect from the store.
In 2020, LegalHomeDelivery.com the first and only legal wines, spirits and beers home delivery service in Dubai, was launched and supported by the UAE’s two leading premium liquor retailers MMI and African + Eastern. The service is available to all Dubai residents who hold a valid liquor licence as well as tourists on presentation of their original passport.
ARENI
And what about the private consumers? Do you have a kind of wine club, or are you thinking about this now that you can legally deliver?
Oliver Dixon:
I have a colleague who is a purely a private client sales manager. He has a pool of 300-plus customers and he manages all of their purchases. Pre-Covid, if somebody was flying to New York and wanted to take a gift, he’d arrange for a couple of bottles to be positioned on outbound for them. Or we set up accounts for them in London and they store their wines in London. There are some countries that it is difficult to arrange delivery to, due to taxation, duties and transportation, but we will always try and support our customers needs where we can.
ARENI
What are your main source of supply when it comes to fine wines?
Oliver Dixon:
We source as much direct from producers as we possibly can. There are a few gaps where we are still building relationships with producers to give us allocations, but as we continue to build our reputation and credibility we have seen our allocations increase. They see an opening and they think, well, maybe I would like to have some distribution in Dubai.
ARENI
Would you say that Bordeaux dominates the portfolio?
Oliver Dixon:
Bordeaux is traditionally the biggest source of fine wine. however share is being eroded by other regions, such as Burgundy, USA and Italy. Italy became a bigger fine wine category than Bordeaux in the On-Premise market of Dubai in 2020 for the first time.
ARENI:
How do you see your fine wine portfolio in the next five years?
Oliver Dixon:
I think there will be a bit of expansion in the Rhône Valley, domaine- Burgundy and probably a little bit more California. Piedmont, Tuscany will both continue to increase as will Spain. We hardly touch Oregon which is likely to change.
Oliver Dixon, Head of Fine Wine, MMI
ARENI
What would you say are the main strengths and weaknesses within your fine wine system? For MMI and the customers you work with.
Oliver Dixon:
I think vintage variation is a weakness for Bordeaux when you compare to its closest competitors who are much less affected, such as California. Everyone’s producing Cabernet-dominated wines.
The strength of Bordeaux is that because of the way they set up the market, they get a lot of marketing push from people, through having set up a process of competition within buyers. To get access, you have to prove yourself as a buyer. I think people buy a lot of Bordeaux because they don’t want to miss the opportunity, even if they don’t know what the opportunity is.
Oliver Dixon, Head of Fine Wine, MMI
ARENI
If we talk quickly about your consumer and your fine wine buyer, have you identified one or several profiles?
Oliver Dixon:
Dubai is at the crossroads of the world, and we have an international customer base. As part of this we have a good proportion of Chinese and Russian customers who purchase for both personal enjoyment and gifting.
Well also have many expatriate customer, from varying nationalities including Lebanese, Indian, South-East Asian, European, French, and British to name a few. We do a lot of fine wine events, which enables us to get to know our customers on a one-to-one level and also take the Le Clos experience out of the airport.
ARENI
How loyal would you say fine consumers are to you as a merchant?
Oliver Dixon:
We have a higher loyalty because we don’t have that much competition in what we do. There are no other retailers that have a breadth of fine wines that we have that we offer. Therefore, we’ve become the number one.
Customers trust us as we offer them unprecedented access to a superior range, they know the provenance of what they are purchasing and furthermore they get exclusive invitations to our events where they can enjoy an intimate experience with some of the world’s best producers.
Oliver Dixon, Head of Fine Wines, MMI
ARENI
How would you describe your customers’ knowledge of fine wines?
Oliver Dixon:
Our customer base is very knowledgeable and understand fine wines. Many will have cellars in Dubai and Europe. We have producers from around the world visiting the market and meeting our customers and they are always impressed with how sophisticated the Dubai market is.
ARENI
Do you have seasonality?
Oliver Dixon:
December is the strongest month. And then the three months, either side of it: October, November, January, February, and March, are the biggest months. The worst months of the year in terms of revenue for fine wine are July and August, but this year we we tracked ahead due to COVID,because nobody could leave Dubai.
This interview has been lightly edited and condensed.
For in-depth research on Fine Wine Consumers globally, see our latest publication The Future of Fine Wine Consumers 2021