1. in Dubai
Marketing 680
Professor Matthew Fisher
Erica Wu, Laura Sordello
Orcun Kocas, Nick Piccininni
Doaud Moulid, Alan Gutierrez
23 May 2015

2. A. Country Outlook:
Demographic: Since 2010, the population of Dubai has steadily grown at a consistent pace. Based
on the statistics published by the Dubaian Government, which is provided by the chart below, the
growth rate is 16% and the current population of Dubai is 2,269,000 people as of 2014.
Dubai Population Distribution:
Dubai is a diverse cultural community; the
total population of Dubai belongs to United
Arab Emirate Nationals and approximately
71% of total Dubai population belongs to
various nationalities, including Indian,
Filipino, Pakistani, Bangladeshi and other
Asian Communities as well as Europeans. 3%
of Dubai emigrants originate from western
countries (Demographics, 2014)

3. Economy and Economic Trends in Dubai:
1. Inflation Rate: The country was not
affected much by the Global Economic
Crisis of 2008, until after the crisis.
Dubai’s lack of infrastructure and high
taste in luxury scared investors. The
government has worked on reducing its
high inflation and on the state’s
recognition in order attract additional
private investors. They have since reduced
the inflation rates and strengthened their
infrastructure. However, after the Global
Economic Crisis of 2012, the inflation rate
was significantly increased due to the
exchange currency fluctuations, which
were, unfortunately, tragicallyunavoidable.
2. Current Currency Trend: Since our company is located in Napa Valley, California, our
production currency is based on the US Dollar. Therefore, before entering into the Dubai Business-
to-Business interaction market, our company made a currency trend analysis for currency analysis
and in order to determine the transportation and export costs (Official Currency for United Arab
Emirates). With the currency presently standing at 3.67 UAE dirhams to $1 US dollars, the market
we will enter in will be similar to the US market in terms of similar purchasing power for consumers,
proving to be a positive and efficient market in relation to current market conversions.
3. Direct Foreign Trade, Free Zone Trade, Custom Warehouse Trade Source: Dubai
Custom
Direct Foreign Trade (Value in Million AED) (preliminary data)
2014 Quarter 1 Quarter 2
Import 129,738 134,195
Export 23,209 26,906
Re-Export 43,476 42,003
Free Zone Trade (Value in Million AED) (preliminary data)

4. 2014 Quarter 1 Quarter 2
Import 67,839 68,033
Export 2,649 5,005
Re-Export 51,468 50,251
Custom Warehouse Trade (Value in Million AED) (preliminary data)
2014 Quarter 1 Quarter 2
Import 3,813 4,740
Export 455 293
Political and Legal Environment of Dubai:
Political Environment
The UAE political and legal environments are a combination of old world values and the
21st Century; the political system is influenced by both civil law and Shari'ah Islamic laws. In relation
to our alcoholic product, the amending civil law is applied to the sale of alcohol because of the
contradiction of the Shari'ah laws regarding imbibing any alcoholic drinks. Shari’ah laws are strongly
rooted in Muslim religious context. With this knowledge of the political environment our company
can enter the market with a deeper understanding in how to conduct our business with
professionalism and respect to local customs and culture. Due to the high regulation on the citizen
livelihood, our company will target the business-to-business opportunity for Dubai market
expansion.
Legal Environment
With increased budgets in employment and infrastructure expansion enabling private sector
growth, a Trade and Investment Framework Agreement in November 2004 was agreed to undertake
negotiations toward a Free Trade Agreement with the US, however is still in progress (CIA World
Factbook, 2015). UAE is offering 100% foreign ownership and zero taxes, an attractive lure for our
company, Ménage á Trios, within this Free Trade Zone. For our firm to enter the Dubaian market,
we must obtain a license from the DIFC, which is strongly under the influence of the Shari’ah laws
(Trombly, Maria, and Betta Plebani, 2014, p. 1). In addition to our acquirement of proper licenses,
Ménage á Trios must take into consideration the duties associated with our product category;
“...Alcoholic products are assessed a 50% duty” within the custom Union of the Middle East (Doing
Business in the United Arab Emirates: 2014 Country Commercial Guide for U.S. Companies, 2014,
p. 54). Due to the complexity of the Dubai environment, we propose to enter the market with a
third party aid. Therefore, our company has decided to pursue a contract with a leading-host

5. national individual agent (secondary distributor) to aid in our market development and distribution
to ensure synergic performance between our company and our affiliates.
Cultural and Social Factors:
Cultural Factors
An important element to our investigation of entering the market in Dubai includes all
cultural and social factors that will impact our business coordination on an international scale. With
the projected demographic input regarding the above sections, our company predicts with the
statisticalimplications in conjunction with high context societal undertones prove to indicate
positive projected success. For example, "the high context societal implications of the UAE as the
Department of Commerce iterates our small wine firm must be prepared to anticipate late payments
for products as the business norm with our host country is ran in a different manner than the fast
low context US society" (Doing Business in the United Arab Emirates..., 2014, p. 55). The late
payments as an example shows how strong the importance of trust is to Dubai's high context social
structure. This example shows how as a firm representing the US, we must make it our obligation to
establish and nurture our relationship with our future affiliates. With high context in addition to
long-term orientation, business relationships within Dubai must be nurtured and cultivated to
remain relevant in our preferred market setting.
Social Factors
Alcohol in itself is controversial within the UAE, because of its historical religious beliefs so
finely infused right into the Dubaian way of life, selling to our potential customers will indeed be a
challenge to ensure an ethnographic way of conducting business, however diverse our target market
consisting of visitors may be. “The consumption of alcoholic beverages in public is strictly
prohibited in the UAE. Muslim offenders are punished as per the Islamic Shariah law. Expatriates
are penalized by paying a fine, confiscation of their driving license, serving jail term, and possibly
deportation to their home country” (Manoukian, 2012, p. 3).
Our company has also indicated a strong interest in social events conducted within Dubai
during tourist season to extend our reach to potential consumers at a maximum level of impact.
"Gourmet food can also be experienced at two unique festivals in the UAE: the Taste of Dubai
Festival, which usuallytakes placein March at Dubai Media City and Gourmet Abu Dhabi, a
culinary extravaganza held in the capital in February each year" (Food and Drink: Eating Out, 2010).
This presents a challenge as well as an opportunity for our company in which further research in
regulations in which we can effectively promote our brand within Dubai would be needed for
further investigation.

6. Muslim (Islam; official): 76%,
Christian: 9%,
Other: 15%
Primarily Hindu and Buddhist,
less than 5% of the population
consists of Parsi, Baha'i, Druze,
Sikh, Ahmadi, Ismaili, Dawoodi
Bohra Muslim, and Jewish
Source: The World Factbook:
Middle East: United Arab
Emirates.
B. Industry Outlook
I. Size Of the Hotel and Tourism Industry: Hotel Guest Numbers from Dubai’s
Department of Tourism and Commerce Marketing.

7. As the above graphs indicate, the number of hotel guests increases yearly in a positive response to
the changing economic environment. Dubai’s growth within the last couple of years proves to be
ideal in terms of a market in which our company can take a part of.
Major Product Types to Be found in the Dubai Market
Almost 75% of alcoholic beverages traded in UAE are sourced through on-trade (on
premise of seller) and 25% through off-trade channels. With this variety of points of sales for getting
our Rosé wine to our target segment, we will focus our attention on four and five-star rated hotels to
maximize penetration and focus our brand awareness through the aid of our chosen distributor.
With a total of 160 four-star and five-star hotels, Dubai has more than 1400 on-trade outlets, such as
restaurants, bars and nightclubs (Dubai Population Estimate, 2012). This gives Ménage á Trios
plenty of options to focus efforts to ensure our product is made available in the Dubaian market.
Consumer Buying Patterns / Product Features/Preferences and/or Shopping Habits
Because our target is a constantly changing seasonally as tourists’ home country holidays,
events, etc., may vary, consumer habits internationallyrepresented in spending in Dubai’s market
can only be generalized to an incoming global variety. “Dubai is in the top ten ranking in terms of
visitor spending, which is estimated to reach USD 11.95bn in 2014 while it will remain the city that
generates more international overnight visitor expenditure per reside” (Tsetsonis, 2014, p. 2). This
indicates the high levels of spending power brought to Dubai by the visiting tourist sectors in which
a portion of tourists visiting high star rated hotels in which our company will promote our proposed
product.

8. Distribution of the Product:
In our distribution strategy, we will manage through indirect involvement utilizing previously
established channels with building a relationship with a trustworthy distributor with strong
connections to the restaurant industry in Dubai. Because of the cultural diversity between our
company and our potential hotel customers, we acknowledge an intermediary is necessary to build
our relationships and refer to the common business practices of civil and Shari'ah laws. We chose to
simplify our distribution channel to reduce the risk of product damage, limit potential logistic issues
to ensure our products arrive safely into the hands of our customers (the hotels), and demonstrate
timely inventory stock replenishment. In addition, with forming a partnership with an already
established player in the distribution strategy who projects future development of their own
relationships with the growing hospitality business in our geographic target, we project a steady
success. With “...two major distributors in Dubai: African and Eastern (A+E) and Maritime &
Mercantile International (MMI)....A third distributor in Dubai is Coastal Communities Distribution
(CCD) owned by the Dubai based Nakheel Company, which is licensed to distribute exclusively to
the coastal communities of the Palm Jumeirah and The World projects” (Manoukia, 2012, p. 4).
Our decision for distributors will need to fulfill the important quality need, an excellent
customer database for order processing, and to track shipments efficiently for both the satisfaction
of our company and our customers. Because of potential exclusive salesrights in addition to the
high context relationships we would need to build with our distributor, we must choose one
distributor through shipping quotes to ensure maximum impact. In addition, to ensure our products
reaching the end consumers, we plan to invest in freight insurance to aid our shipment through our
chosen distributor in order to augment the confidence in our company's choice in logistics and
balance risk for a singular entrance of our potential market.
In working with major distributors, we will be able to reach the biggest portion of our
interested target of hotels with high star ratings in addition to forming relationships through a third
party with cultural knowledge within Dubai. On-trade distribution through hotel company affiliates
such as Jumeirah (very luxurious company with 9 hotels/resorts), Emirates Palace, One & Only,
Starwood's Resorts, Hilton, Hyatt, etc. Our company is looking for high frequency with mid to high
quality hotel options for tourists and visitors from around the world. Despite our wide target, we
realize the importance of choosing the right hotels to sell our products to must be open to the
international cultural norm of the relaxation and enjoyment of sipping and drinking fine wine, no
matter the environment or the occasion. We wish to supplement their stay in Dubai and make an
enjoyable experience in one of the world's leading business centers on the globe.
Advertising & Promotion:
Standard advertising practices and promotions are not applicable considering that it is
prohibited to openly advertise alcoholic beverages in newspapers and mass media due to religious
sensitivities. “Showing product names, brands, and pictures of alcoholic beverages are also not
allowed in the UAE” (Manoukian, p. 5) We are indirectly selling to hotel restaurants with the aid of
our distribution partner and will not have to worry about expanding beyond that for the time being.
One of the major ways we will be standing out in a place where promoting alcohol is

9. frowned upon will be in the design of our bottle. The bottle will be forged into a more twisted shape
that resembles the building styles of Dubai. Furthermore, we will be adding an added incentive to
order our wine through our selected distributor by including frosted wine glasses. These glasses will
be used specifically for our wine and can be purchased by the hotel guests. They double as brand
recognition and souvenirs that include the image of Dubai’s man made Palm Islands and our wine
name to ensure that the customer remembers both their trip and their wine choice vividly and
fondly.
The name Ménage á Trios is a trait that can help sell itself; it is a novelty and catches the eye
of the tourist, who will try it solely for that reason. As for the translation from French to Arabic
there is nothing overtly sexual about it, which is a plus. When translated, it turns simply into “trio”
or “group of three,” which will be another selling point of ours. We will be changing the label design
in order to accommodate this translation better by adding a third character and have all three
holding wine glasses to imply more of a drinking aspect. The tag line will change to read either:
“enjoy it with a friend… or two,” “3’s good company,” or “3 glasses good.”
Pricing Strategy: What is the customary markup?
A 50% duty for alcoholic beverages is applied to all beverages regardless of concentration of
alcoholic content in accordance to the UAE common law and regulations. In addition to the
extremely steep duty, Ménage á Trios will be pursuing a cost-based pricing strategy in order to not
only combat international expensive pricing issues, but to appropriately attract the market segment
of tourists and visitors willing to pay a premium for our Ménage á Trios brand of Rosé wine.
In addition, we will be increasing the total price of the final on trade product on restaurant
premises by a total of 200% in order to cover labeling, bottle redesign, distributor fees, freight
insurance, and hotel markup. A design to cost approach allows our product to compete efficiently
with the expanding global market where our brand will be continuously exposed to strong
competitors and established wine brand names. This strategy ensures a healthy profit for each
member of the distribution chain, amounting to a total of $20 US dollars.
Compare and contrast your product and the competition’s product/service.
Competitor’s Product/Service: Brand Name, Features, and/or Package
Our product’s primary competitors are rosés made by Blossom Hill and Mondavi. Ménage á
Trios is all about its great taste, it “examines what happens when you put three attractive, single,
young grapes in one exquisite bottle,” according to our website. As opposed to our competitors,
Ménage á Trios has an exciting brand name which encourages friends to gather in groups of 3 or
more to enjoy the wine together. Ménage á Trios’ bolder blush wine color signifies more richness,
wholesomeness and savory flavors compared to its competitors.
Unlike our team’s approach to customize Ménage á Trios’ bottle design, Blossom Hill and
Mondavi standardizes their product packaging. We plan to differentiate Ménage á Trios through
innovative and high quality product packaging. We intend to take Dubai’s finest architecture and
redesign our bottle to attract the eyes of tourist. Our Rosé will be perceived as a luxurious wine, as
well as a souvenir product, which consumers can ultimately takehome as a remembrance of their
Dubai trip.

10. In contrast to competitors, Ménage á Trios will be served in highly specialized wine glasses
that includes its brand label, Dubai and its famous Palm Island landmark etched on the glass. Upon
the sale of each bottle of rosé, it will be bundled with complimentary wine glasses, which our
distributors will be managing.
Competitor’s Prices
High end hotels in Dubai are selling bottles of rosé wine from other countries for an average
of $100 per bottle and around $20 per glass. Our first competitor is Robert Mondavi, who prices
their rosé at 220 AED per bottle and 44 AED a glass, or $60 and $12 respectively. E&J Gallo
stands at the same price for a bottle, but it is unclear for how much a glass goes for, 220 AED or
$60. Chateau Ste Michelle has a lower alcohol volume rose than Ménage à Trois at 11.5% that is also
on the cheaper side at only 147 AED or $40 a bottle. Ménage à Trois will be sold at 367.31 AED
($100) and 73 AED ($20) per glass; the pricing of the souvenir glass will be based on the hotels
decision.
Competitor’s Promotion and Advertising Methods
Just like everyone else, our competitors cannot advertise publicly due to UAE laws.
Therefore providing only points of differentiation on anesthetic allure, brand appeal, and price value
of all competing products.
Competitor’s Distribution Channels
From what information is available to our company, our competitors both indirectly and
directly are pursuing secondary distributors as a way to reach the Dubaian market. Because of the
political and societal taboos associated with alcohol, all suppliers and firms associated are subjected
to the same duties and restricted to the same modes of entry to reach end consumers. Blossom Hill
and Mondavi both distribute their products through African+Eastern’s on-trade and off-trade
distribution channels.
To better appreciate the country and industry outlook sections, please try benchmarking (as
far as possible) that information with statistics from the US market
C.Brand/Company Marketing Strategy:
Producer Company: Folie à Deux.
Product/Brand Name: Ménage à Trois.
1. Entry Strategy: The entry strategy that our company has decided on will be exporting. The main
reason for choosing exporting is that our company wants to build a unique brand through brand
awareness and brand recognition, while focusing on our country-of-origin advantage. Furthermore,
our wine can only be produced in the Napa Valley region because of the unique terroir that
differentiates our wine. In order to achieve this market and brand strategy, we have determined
exporting to be the best option.
The company has considered three options: joint venturing, market penetration and licensing.

11. However, this would cause complications within the marketing strategy in which the the company
will pursue:
1.1. Since the company is trying to build a high end luxurious rosé wine option for the Dubai
Tourism Market, if the company pursues joint ventures with another company located within the
state border limits, then Folie à Deux risks potential negative repercussions to our brand image.
1.2. As the company will be conducting business-to-business approach and will not target
the customer segment directly, a market penetration strategy will be an extremely unrelated entry
strategy, which would cause unwanted recognition by the customers and the bar managers that are
located within hotels. In addition, a market penetration strategy can cause a potential
misunderstanding in the communicated perception of product positioning that can hurt the
luxurious, exclusive image that our company is trying to build.
1.3. Licensing would be an amazing opportunity for the company to expand the company’s
operations to Dubai. However, the licensing of production and distribution of Ménage à Trois
would hurt the brand image due to the fact that the company is implementing the essential of the
rosé wine, which is coming from the heart of California’s Wine Country.
2. Feasibility: Any legal restrictions that might have a bearing on the feasibility of the
proposed project?
When a company enters a new market or starts their global programs there are always new
commission and government regulations that international firms have be aware of. In order to
reduce the weight of these complex procedural steps in getting into Dubai’s market our company
has decided to work with a private individual agent, whereas agents are licensed and approved by
government officials. Exporting will be our company’s best option for transferring our Californian
produced wines into the new market. The company is aware of the fact that political risks and
regulatory legislation is high, however with the right agent these risks are manageable. Folie à Deux
targets luxurious and comfortable hotels including bars and restaurants that are privately managed
within the hotels active body. This mode of organization would reduce stress on operating costs
since the product is not directly distributed to consumers. As a result of conducting business-to-
business sales and promotion, Folie à Deux face limitations on advertising since we are not focusing
directly on customer consumption.
3. Market Coverage Strategy:
Folie à Deux’s market coverage will be exclusive distribution to the Dubaian hotels where
the hotel segments and markets the wine to the customers. Market coverage strategy will be
extremely limited; coverage will be specialized. The whole Dubai market is not going be covered due
to the fact that the residents, who were born and raised in Dubai, are not allowed to purchase
alcohol, unless they have a purchase permit. Therefore, we will specialize distribution and coverage
strategy directly to the luxury hotels, and indirectly to tourists and end customers. As mentioned

12. previously, there are a total of 160 four-star and five-star hotels, which translates to more than 1400
on-trade outlets such as restaurants, bars, and nightclubs that we can take advantage of.
4. Product:
Our firm plans to refresh our brand’s image to bring a stronger luxury association to our
rosé wine through repackaging and redesigning both the label and bottle to increase proper
communication to our target market, and at the same time differentiate the product from our
competition. The bottle shape will move away from the common wine bottle silhouette and move
into a sleeker and chicer design of a rectangular progressive twist with gold and green color accents
to further enhance the married elements of the luxury and light flavors of rosé being served in
Dubai as secondary associations. Language translation in context will be addressed to avoid any
negative connections to sociocultural taboos. The additional costs on packaging and labeling this will
include simply an easy to read tag line as opposed to the original bottles’ wine description and
tasting notes. We recognize the concern of negative implications associated with the term as well as
our brand name, “Ménage á Trios.” To alleviate a potential threat, we plan to collaborate with our
chosen distributor to ensure a proper translation or any issue specifically with the brand name in an
extremely religious-conscious region. Both field marketers in addition to our distributors will be
strongly encouraged to emphasize the luxurious nature of our brand and the celebration experience
our brand can bring to our potential market.
An additional product design that will be implemented will be our brand-specific wine
glasses featuring a frosted outlay with the brand name, tagline, and the globally recognized and
Dubai-associated image of the Palm Island. The glasses will be manufactured after thorough
manufacturer review outside the host country, to enable a maximum cost base price absorption for
our pricing strategy. We hope the wine glasses will bring an additional level of exclusivity of our
luxury marketed brand name “Ménage á Trios.” Sales of these glasses will be directed to hotels;
however, they will have the right to sell them at an additional markup to customers who wish to
make a souvenir purchase. This will attract hotels interested in bringing in additional future visits to
Dubai as well as provide an aid in brand awareness and recall to our product.
5. Distribution Channel
Individual PrivateHost-NationAgent
The channel distribution will be an individual agent, host-nationalagent, who knows the
market more than any other agents. The agent will be able to help our company to set up long term
relationships and help our product distributed to high-end luxurious hotels. The agent must be have
accomplished relationship where they can offer our product to hotels. Our distributor must be
trained for place, time, information utilities and he should be a well-trained distributor who knows
our wine. The agent should be able maintain the brand image and assist the hotels in any kind of
trouble before contacting home company.

13. 6. Price: What pricing strategy you recommend and why? What are the custom duties and
import taxes? What are the wholesale and retail markups and discounts? How do the
proposed retail prices
(relative to competition)
compare with the prices in
the US market?
Since our firm will be
adapting a polycentric pricing
method, where the final sale of
the bottle will include all the
costs, (labeling, translation,
tariff, quotas, packaging,
distribution, mark up costs and
wine glasses) the marketing
team has decided to use cost-
based marketing entry pricing.
The company has decided that
they would like to earn four to five times the revenue earned in home-country compared to the
Dubai market. Since the exporting duties are extremely high and expensive in Dubai within the cost
of operations management, shipment, and distribution cost, our firm believes that cost-based
marketing entry pricing would our best option. The pricing strategy fulfills the company’s profit
markup, and the marketing department’s decision through a thorough analysis of both internal and
external costs of entering into our host country with a luxury rose wine product.
To further elaborate on our cost-based pricing strategy, our firm plans to pursue a rigid cost-
plus pricing method. This strategy ignores the changing demand and competitive market conditions
outside of the product’s home country. Since Dubai is a luxurious destination, we are less concerned
about competitive pricing and more focused on internal and external cost figures available. Due to
the fact that wine is an agricultural product, our 2012 Ménage à Trois Rose is limited in supply. The
scarcity potential of our wine enables us to pursue a strategy that supports rigid pricing. Considering
that our product is also a souvenir, end consumers will pay considerable amounts of money for it.
The custom duty fees for alcoholic beverages is 50% of the sale price of the product. In
terms of per-bottle pricing, we plan to sell the wine to distributors for $70 and be charged $35 for
duty fees. Although we encourage the distributors to determine the optimal selling price to their on-
trade partners, our suggested price is $80 (293 AED). Hotel restaurants, bars, and lounges could buy
the wine for around $80 (293 AED) and resell the bottle at $100 (367 AED), or their desired mark-
up price. One bottle of wine serves 4-5 servings, and price per glass would hover around $20 (73
AED).
7. Promotion: How do you plan to position your product? What specific ad media do you
plan to use and why? Which specific media vehicles do you plan to use and why?

14. We are planning to promote and position our product as a high quality rosé wine that is
produced and bottled in the California Wine Country. It will be promoted as an exclusive product
served to the customers of high end hotels, and privately managed bars and restaurants under the
dome of these targeted hotels. Since our company will be conducting business-to-business sales,
advertising in media is not advisable since the product is not targeted and segmented directly to the
Dubai residents.
In order to expand the brand image and brand recognition, our company is planning to
accomplish trade promotions with the private agent, and give him or her the incentive to advertise
our brand and our product to high-end Dubai hotels. Through the channel promotions, we can
solidify our position on the prefered wine lists of our hotel partners/affiliates. Therefore, we can
promote our wines through pairings with popular restaurant dishes in addition use field marketers to
promote the rosé wine selection communicated through the wine lists in restaurants and hotel bars.
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