Halmstad University

Strategic Innovation Management II

Coors Beer international Dubai/United Arab Emirates market

- Case study

Group 4
Rosa (Naijing) Du,
Mohamed Mekki,
Samer Al-Mimar
Termination Date: 06.10.2015

Technical Project Management and Business Administration

Contents
1. Introduction..........................................................................3
2.Market Overview....................................................................4
Major Distributors in the UAE:.........................................................................5
Dubai:.............................................................................................................. 5
Abu Dhabi:....................................................................................................... 5
Advertising and Promotional Activities............................................................5
Market Size...................................................................................................... 6

3. Environmental Analysis.........................................................7
PEST/ DN-Analysis...........................................................................7
Political factors:............................................................................................... 7
Economical factor:........................................................................................... 7
Sociological factors:......................................................................................... 8
Technological factors:...................................................................................... 8
Demographic factors:...................................................................................... 8
Natural factors:.................................................................................................. 8
SWOT-Analysis.................................................................................8
Opportunities and threats for brewing industry...............................................8
Strengths and Weaknesses of Coors and Competitors....................................9

4. Porter 5 Forces....................................................................10
Industry competitors:.................................................................................... 10
Threat of substitution:................................................................................... 10
Bargaining of suppliers:................................................................................. 11
Bargaining of buyers:.................................................................................... 11
Potential entrance:........................................................................................ 11

5. Diamond model...................................................................12
Factor conditions:.......................................................................................... 13
Demand conditions:...................................................................................... 14
Firm strategy, structure and rivalry:..............................................................14
Related and supporting industries:................................................................15
Chance and government:.............................................................................. 16

6. Segmentation, Positioning and targeting..............................17

Segmentation:...............................................................................17
Geographic segmentation:............................................................................ 17
Demographic segmentation:.........................................................................18
Psychographic segmentation:.......................................................................18
Behavioral segmentation:.............................................................................. 19
Targeting.......................................................................................19
Target customers:.......................................................................................... 19
Target market:............................................................................................... 19
Positioning....................................................................................19
Functional positioning:................................................................................... 19

Symbolic positioning:.................................................................................... 20
Experiential positioning:................................................................................ 20

7. Marketing mix - 5P:.............................................................20

8. Market entrance (action plan)..............................................21
The Gulf Cooperation Council (GCC)..............................................................22
Foreign Investment And Business Establishment..........................................22
Limited Liability Company (LLC)....................................................................22
Joint Stock Company (JSC)............................................................................. 22
Unincorporated Joint Venture........................................................................22
Branch Office................................................................................................. 23
Taxation......................................................................................................... 23
Contracting with Agents and Distributors......................................................24
Doing Business in Israel................................................................................. 24

9. Conclusion:.........................................................................25
10. Recommended Strategy.....................................................26
First strategy:................................................................................................. 26
Second strategy:............................................................................................ 27
Third strategy:............................................................................................... 27
The fourth strategy:....................................................................................... 27

1. Introduction
United Arab of Emirates contains seven states following both mixed legal system of Islamic
law and civil law: Abu Dhabi, Dubai, Sharjah, Ajman, Um-Alqawen, Fujirah, Ras Alkhaema
The population is almost 10 million people with about 11% of local Emirate and the rest are
foreigners. For the alcohol sells its not allowed to sell to anyone without having alcohol
license and the license can be provided only to non-Muslim people. The license can be gain
from the police department at the state where the resident live, the license provided only for
residents not for visitors. After getting your license you can buy your alcohol from certain
supplier similar to Systembolaget in Sweden, the drinking age is +21. Other source for
alcohol is Ajman free zone area where you can buy as much alcohol you want for very good
prices. We should mention that UAE is tax-free country where almost everything much
cheaper than Europe. Another source of getting alcohol is the duty free in UAE airports,
which is allowed to buy up to 4 liters of alcohol.
However, alcohol sold without license to anyone at restaurants, bars and clubs that are the
main sources of alcohol in UAE. The country depend mainly about business and tourism, that
why huge number of hotels and tourist areas can be founded in UAE.

From the above figure easily can be noted the high percentage of Muslims in UAE which
alcohol consumption is prohibited in Islam. However, that doesnt mean all Muslims not
drinking alcohol, in fact a lot of Muslims used to drink and smoke. Drinking in public is
prohibited all over UAE, also drinking is totally prohibited in some states as they follow the
Islamic Sharia laws, and when person arrested with accusation of alcohol can get 80-200
lashes plus fine. The states following Sharia laws are Sharjah and Um Alqwen, which usually
punished the crime of alcohol accusation with lashes.
The main gate to UAE is the tourism growth as the country received more than 13 million
tourists in 2014 and expected that number to increase to around 40 million tourists by 2024.
Leisure travel spending (inbound and domestic) generated 78.6% of direct Travel & Tourism
GDP in 2014 (SEK 182.1bn) compared with 21.4% for business travel spending (SEK
49.6bn). Domestic travel spending generated 25.9% of direct Travel & Tourism GDP in 2014
compared with 74.1% for visitor exports (ie foreign visitor spending or international tourism
receipts). The domestic tourist from inside UAE or from neighbour countries, which they
travel to UAE in order to spend a lot and sometimes to visit the nightclubs and bars which are
prohibited in surrounding countries. Other segment of tourists is the foreigners arrived to
UAE from outside the GCC area (Europeans and Americans), which mostly wealthy and visit
the country to have great time and mostly to party. The above information showed the great
opportunity for COORS to enter new market, as the product is known by international
tourists and easily could make it way to the end customer.

2.Market Overview
United Arab Emirates prohibits the production and consumption of alcoholic beverages for
Muslims. The law is strictly applied to all Muslims in the country regardless of nationality.
So because of the large numbers of residents of non-Muslims in the UAE the government
allowed them to purchase and consumes alcohol according to certain conditions; should have
a valid liquor license, at least 21 years of age and have a monthly income ($815 minimum).
All places serving alcoholic beverages (hotels, night clubs restaurants, bars, stores, etc.)
required having a valid liquor license issued by the local police authorities.
Market Segments and Distribution Channels Alcoholic beverages trade in UAE can be
divided into three broad segments:
1. On-Trade and Off-Trade channels.
2. Duty Free and Dubai Ports
3. Re-Export to other countries
On-trade (pubs, clubs, bars, restaurants etc)
Off -trade (corner shops retails etc)
Almost 75% of alcoholic beverages consumption in UAE are through on-trade and 25%
through off-trade channels. Dubai alone has more than 1200 on-trade outlets such as
restaurants, pubs and nightclubs.
The largest second segment is the duty free stores, the passenger's traffic In Dubai airport
reached 51 million in 2011 and more than 11 million stayed at UAE hotels.
Major Distributors in the UAE:
There is a limited numbers of companies engaged in the import and distribution of alcohol in
the UAE we will take the two largest cities Dubai and Abu Dhabi the UAE:
Dubai:
There are three distributors, the two majors are: African and Eastern (A+E) and Maritime &
Mercantile International (MMI).
MMI holding around 57% of the market shares whereas African & Eastern (40% owned by
SAB Miller), has 43% of the market share.
(A+E) operates around 24 retail stores in Dubai and Abu Dhabi and MMI operates 13 stores
located in Dubai and northern of Emirates. The third distributor in Dubai is Coastal

Communities Distribution (CCD) owned by the Dubai based Nakheel Company, it's the
exclusive distributer for the Palm Jumeirah and the project world which still under
construction.
Abu Dhabi:
In Abu Dhabi, the Abu Dhabi National Hotels (ADNH) is the major distributer, its a joint
venture company with the UK based Compass Group. Two other distributors are (A+E) as
mentioned before and Gray MacKenzie & Partners.

Advertising and Promotional Activities

General advertising, mass media, newspapers and even illuminated signs are prohibited in the
UAE also Commercial posters, brands names, window displays and pictures are not allowed
and lead to cancel the license.
Only allows advertising inside the shops selling alcohol (on-trade channel) and companies
can hold an events inside the stores and distribute catalogues, vouchers and different types of
media (off-trade channel).

Market Size

Fig from the WHO/ Global Alcohol emro

Because of UAE can't produce alcohol beverage and the Islamic law we can see how the
consumption is too low during 1972-1996, also the total population at that time was not
exceed 2 million.
Due to the lack of sufficient data for brewing industry in the UAE the below table is for 2010
only showing the total amount of importing and exporting alcohol beverages in the large
three emirates Dubai, Abu Dhabi and Sharjah. A total of 107M$ were imported and 7.4M$
were re-exported to the neighbors countries in the 2010.

The total value of the imported alcoholic beverages from the USA reached 3$ million
represent about 3% from all the imports , the beer is about 35% from the total imports and
most famous brand are Miller & Budweiser.
The below table illustrates the import and re-export size from and to different countries in
2010:

3. Environmental Analysis
PEST/ DN-Analysis
Political factors:
UAE in general and Dubai in special has a stable political and financial situation we can say
it's a tax-free country with excellent tax benefits except for alcoholic, since no alcohol
production in the UAE the government impose heavily taxed almost 50% for importation.
Furthermore there is an age restriction for the consumption of alcoholic and the regulation for
the license is highly restricted and subject to strict conditions.
The most important factor is the UAE consist of seven emirates each one has its own
governmental institutions which required license for every emirate.
Economical factor:
The UAE is the second largest economy in the Arab world and has a huge infrastructure
project and some projects are under construction. The main revenue is from tourist, real
estate, construction, financial services plus the oil and the natural gas.
UAE has no foreign exchange control that attracts investments and facilitates the import and
export. The country will achieve a significant growth due to the good economic policies and
do not forget Dubai EXPO 2020, which expected to attract 25 Million visitors from around
the world.

Sociological factors:
UAE has a large expatriate population (more than 80%) Dubai is the most populated emirate
with almost 36% of the UAE population with a large numbers of foreigners.
Despite UAE being a Muslim country but alcohol is available all over the country and most
diffused in Dubai with a certain conditions as mentioned before.
Technological factors:
One of the main factor influence the industry is the transportation and logistics services, the
size and the efficiency of Dubai ports and even other emirates can play a vital role in the
brewing industry where there is an active commercial movement between the UAE, united
states and Europe plus the good infrastructure of roads and marine ports will facilitate the
process of import, export and distribution.
Demographic factors:
Alcohol in the UAE is forbidden till the age of 21, due to restrictions of drinking alcohol
most of the consumers are foreigners, which may affect at the growth of the brewing industry
in the country.
Natural factors:
Competition is almost non-existent in the UAE due to the restrictions of the license for
brewing of importation and distribution; we can say UAE market is very small comparing
with other markets in brewing industry but its profitable.

SWOT-Analysis
Opportunities and threats for brewing industry
Opportunities

Coors can emerge with other companies in the UAE which will reduce the risk.
They can produce zero alcohol for the Muslims consumers.
Beer with different flavors.
Change of regulations in the future may increase the beer consumption.
Change of regulations may also allow for beer production in the UAE.
Exportation to the neighbor's country.
Threats

High Taxes for alcoholic.

Government regulation in age restriction.

 Economic crises as happened before in the UAE.

License regulations.
High prices from importation comparing with the local zero alcoholic drinks.
Strengths and Weaknesses of Coors and Competitors
Coors Strengths:

Vertical integration structure.

Good quality beer
Sustain long-term relationship with their suppliers.
Good production activities (cold filtering process, large packaging facilities.
Good in procurement (VIPER PROG).
Promotions and advertising through national football league.
Unique value systems in HRM towards employees
Coors Weaknesses:

Family based management style.

Rely on few popular brand names.
Concept of beer is only for middle or lower class members of society in the US.
Strengths Competitors:
(MMI) & (A+E) have license that is hard for the new entrances.
(MMI) & (A+E) have retails shops all over the country with joint venture with other
emirates.
Good importation and distribution activities.
Weaknesses Competitors:
License cancellation by the government.

4. Porter 5 Forces

By using Porter five forces to analyse the current Dubai beer industry, we figure out Coors as
new entrance of Dubai beer industry is under the other forces from Current rivals, Buyers and
Substitutes. Coors dont have the bargaining from suppliers since they have brewery at USA.
Industry competitors:
There are three current competitors in Dubai beer industry. Competitors MMI and A+E are
currently dominating in the market, the third company still under construction CDI. Most of
them have already designed their non-alcohol beer that focus on muslim.
Threat of substitution:
There are substitutions of Coors beer is the beverage, soda, wine and other alcohols. Because
of the laws, most of Muslims prefer beverage than alcohol. In the same time, in restaurant
and hotel, customers are more likely to choose beverage or wine than beer. Especially in
luxury hotels and formal occasions, alcohols like wine, whisky and vodka are have better
sales than beers.
Beverages like Coca-Cola and Sprite are the main threat of substitution, especially the cold
beverage. Compared to Coors non-alcohol beers, people prefer other beverages that have

better flavor and better taste in cold. Publics have the habits for drinking cold soda in hot
summer, because the high annual average temperature in Dubai is and most days are sunny
throughout the year. There are also several beaches and deserts in Dubai, which makes cold
soda even more popular than other country.
Bargaining of suppliers:
Coors dont have the bargaining from suppliers, because Coors have their own brewery in
USA and there are Islamic laws and civil laws that forbid any alcohol brewery in Arabian
country, which means Coors have to transport their product instead of establishing a new
brewery in Dubai. Dubai has two major commercial ports, Port Rashid and Port Jebel Ali.
Port Jebel Ali is the world's largest man-made harbor, the biggest port in the Middle East, and
the 7th-busiest port in the world. Since Dubai is not far away from America and Dubai has
these two large ports, the most profitable and convenient way of Coors to transport their
products from America to Dubai is by ship. But it is necessary to transport beers by vacuum
container for the long-time shipping and high temperature in Dubai.
Bargaining of buyers:
The buyers have limited power and few brands to decide between them, as the buyer can get
only what the bar or night club offering to the customers or what the selling points offering of
their shelves. Usually people dont have the alcohol license as many people dont prefer to
visit the police station to get one or they are not allowed to get one as mentioned earlier. For
that reason the buyer get any cold beer offered by the bar, and in party nothing interesting
more than strong stuff make you drank and funny.
However, zero alcohol beer can straggle little more than regular beer, for the reason of
varieties of brand names well known by customers. Such product normally offered in normal
supermarkets beside two to three brand names. The innovation in finding new flavor zero
alcohol beer can guaranty the sales in such market, of course with fine beer taste like
COORS.
Potential entrance:
COORS can enter the promising market of UAE after setting solid foundation by getting the
licenses to import and re-sale, and find the proper distributer agent to deliver the product to
the end customer. The market could be risky to enter if we look at the country as Muslim
country and put the xenophobia in front of our plan, but we must understand the need is such
market and the target customer.

Also we should contact the two major licensed companies in UAE, MMI &A+E both
currently operating in the market. The third company still under construction CDI, could be
the next potential for COORS as distributer for the product. By working with the major
distributors in the country COORS can guaranty the entrance and increase the sales.
However, it could limit the number of sales as the distributors are limited, which mean they
already have the market share with existing suppliers. However, the famous brand name for
COORS can do the sales, as the product well known globally for the fine taste and good
quality, especially as the main target customers is the tourist which are familiar with the
brand name of COORS.

5. Diamond model
In this part we will talk about diamond module applied into UAE market in general and
Dubai in special. To clarify the importance of diamond analysis role in Dubai we quote Saeed
Al Muntafiq, CEO of Tatweer said We have made Porter`s theory a reality this shows the
great importance of diamond in the head of UAE leaders.
Before starting with the diamond analysis we should mentioned the mean industry around the
country. The country play major role in oil & gas industry and the oil was the main base for
the country creation and development. Abu Dhabi alone contains 10% of the worlds oil
reserves. In each state a free zone area was established to bring more investment of
international companies into the market, of course with a lot of governmental facilities and
reasonable prices. Both Ras Al Khaymah and Fujairah depends more on agriculture as they
have better water resources than other states. However, both of Ras Al Khaymah and Fujairah
depend also on tourism depending on fascinating nature. While the state of Dubai is known as
commercial center connecting the east and west, it also has been named the business capital
of the Middle East and has become a large tourism attraction.
The main source of income to UAE is the oil and gas industry, which contributes to the
Government revenues. The biggest producer is Abu Dhabi, the capital of the country and the
biggest state as well. The discovery of oil transfer the country from being a desert to one of
the most booming country in the region
The United Arab Emirates is a constitutional federation of seven emirates; Abu Dhabi, Dubai,
Sharjah, Ajman, Umm al-Qaiwain, Ras al-Khaimah and Fujairah. The federation was
formally established on 2 December 1971.
The main successful industries in UAE:

Oil & Gas

Real Estate

Tourism & Service

Logistics

Bank & Finance

Factor conditions:
The most advantage in this path is the government support the financial cluster with low
interest rate and no tax policy. The government concentrate more on expanding airports,
ports, roads and entertainment. These activities attract foreign capital to the country and
develop the economy. This attraction for foreigners capital has a positive effect on the job
market creating more jobs, which was negatively affect the local human resources and
prevent it from being develop. Also the risk of economic bubble caused by low interest rate
and tax which keep the inefficient firms for long time.
1- Oil & Gas: The source of raw material mainly from Abu Dhabi and Dubai where crude oil
and natural gas can be get. While the cost of extraction and exploration and processing oil is
cheap compared to other countries, also the transportation domestically and internationally is
easy through the ports. Finally the oil & gas technology is available in UAE and well
developed.
2- Real estate: UAE location in Middle East and quite stable area provide great support to
this industry. The big amount of professional workers, global investment, location, stability,
government support and policies, construction equipments, tax free, huge amount of areas
still virgin and no contraction started, plus the great infrastructure around the country. All the
above give great potentials for the industry growth and development, also the government
opened the gate to more investment not only in residential contraction. The government open
more ports and power project to support the infrastructure for the future development, the
new ideas in build over the water. They manage to create very nice islands over the sea which
attracts most wealthy buyers, which can be translated to more than financial benefits as big
names invested in such projects.
3- Tourism: is one of the most important factor UAE, depend on the excellent infrastructure
and the non-local labors. The main infrastructure is the airport where only in Dubai airport
more than 130 airlines operate, travelling to more than 220 destinations. Dubai airport ranked
as one of the most crowded airports around the world, also Abu Dhabi upgrading their airport

to fulfill the high demand, and to comply with the city improvements. Furthermore, the high
quality roads, ports and the luxurious locations attract more tourists to the country.
4- Logistic:
From firm strategy point of view 6 factors must be highlighted: open markets in logistics and
transportation sector, business supportive economic policy, favorable complementary
policies, massive infrastructure investments, attractive regulatory and business environment,
and growth oriented governmental companies. These factors became very important to
develop the industry.
Demand conditions:
The wealthy GCC area requires financial support and provides variety of investment
possibilities. The wealthy area because of oil revenues have to develop their investments,
especially stable country like UAE. The population demand is high quality expectation and
fast delivery requirement, which results in a high demand standard. However, the oil
revenues are sometimes unprofitable invested.
1- Oil & Gas: Globally the demand is very high for petrol as the energy mainly still depends
on petrol. While the regional trend not let demand than the global demand and it grow quite
well after 2003 due to the regional economy grows quite well in recent years. The strategic
location of UAE helps to develop and grow in oil and gas trade, as they sell crude oil and
different types of fuel inside and outside the region.
2- Real estate: The growth of population in UAE give great demand factor to this industry.
Also the governmental facilities to the construction companies by the flexible labor laws
support the industry. Nevertheless, the international investment in real estate market gives
great support to the industry.
3- Tourism: the demand increased annually by almost 6% and will reach to 40 million
tourists in 2024. The high demand will be always attractive factor to the industry and insure
the growth during the next years.
4- Logistic: the booming in local and regional market around UAE was the main demand
factor for this industry. UAE has the best airports, ports, roads, free zones, infrastructures and
industrial cities. Also the population growths and the increased for import because the
economic growth.
These points make economic strength and create demand for the logistic service.

Firm strategy, structure and rivalry:

The financial structure of UAE is attractive to Arabian customers. The Arabian and
international investor enhance the investment strategies. Also the poor developments in the
region provide UAE a monopoly role in the area. Fast moving and project realization is great
advantage of UAE, also the opening of the west culture because of the liberal culture very
attractive to foreigners to invest in UAE. In addition, international financial institutions
attracted by the free zone investment, increased rivalry and opened the market for external
investments.
1- Oil & Gas: UAE has realized great effect on technology development in oil & gas sector,
and keep the industry up to date with world development in that sector by implementing new
technologies from big companies around the world. UAE also understand the need to secure
the economy for the after oil time, by finding new sources for income.
Because the location of UAE between the main petroleum producers, they understand the
need to change their strategy and look further longer than the others. That provides stable &
dynamic foundation for economic growth.
2- Real estate: The context for structure, strategy and rivalry of the construction cluster are
the level of competition among construction companies, the level of trustworthiness and
fairness, the entry barriers in the forms of policies that prevent new entries, and the ratio
between direct and indirect costs. The real estate industry follows the international strategies
in their planning and structures, which give the strength to the industry when everything in
well calculated and planned in proper way. Also the fast growing around the country make
the competition very high between the companies, a race of building most unique and highest
builds between the companies never ends. That keeps the door open to new things every day.
3- Tourism: The foreign investment opened widely in UAE, secular policies with regard to
issues such as alcohol. The local government help and support the economic growth in the
country, the government owned giant companies participating heavily in the market.
4- Logistic: the UAE government created valuable infrastructure in logistic, in all three ways
(Air, water, road) including the communication and energy. The infrastructure support the
development of logistic in UAE, while the geographical location play high role in supporting
the industry.
Related and supporting industries:
As mentioned above, many industries can be found in UAE such as trade, tourism, and real
estate. Therefore, it seems reasonable to establish a financial cluster to serve these industries

with sufficient capital. UAE land consist desert mostly, for that reason its not suitable to
create heavy industry. Opening more industrial diversification would strengthen the financial
clusters position for UAE.
1- Oil & Gas: the infrastructure in UAE from roads to ports and great logistic industry
support the oil & gas industry. While the support industries are energy industry and oil
products.
2- Real estate: oil price increment, development into service sectors such as ports, tourism,
logistics, financial services, health, manufacturing, media all of that led to economically
development in the country. Nevertheless, the country stability, acceptance of western culture,
tax free, international investment, big salaries all of these points provide the proper structure
to the industry to grow.
3- Tourism: the main factors influence the industry is logistic, real estate, retail and finance.
In logistic the roads, ports and airports provide the most important factors. Also real estate
industry develops the tourism industry, by building hotels and tourism entertainment areas.
4- Logistic: The main factors in this regard: highly developed finance, insurance,
construction, and tourism clusters, and rise in local capital markets. These industries and
organizations provide necessary services, markets and information for improvement and
strengthening of competitiveness of the logistic cluster.
Chance and government:
By the end we should mention the other two factors (chance and government): In UAE
market the electronic government make the business easy to establish and develop with
shorten the way and make things more clear. In the same time, the government transparency
is not very high which make it risky to invest in the market is the investor have no clear
picture about the governmental economic situation and other related issues. Other
problematic issue is to get the license to import and distributes the product in Muslim
country; good connection with powerful people can do the trick and make heavy entrance
into the market.
While the chance is high to gain profit from such market, man can consider the market still
new and the chances are really high. Despite the fact its Muslim country located next to Saudi
Arabia, still the chances high for the fact of high tourism movement into the country, and the
tourist from surrounding countries visited UAE to attend the fantastic activities in United
Arab of Emirates and good amount of them visit the night clubs and bars as such places are
prohibited in their home countries.

After all we discuss only four successful industries as we saw its the main industries in the
nation.

6. Segmentation, Positioning and targeting

Segmentation:
Geographic segmentation:
The United Arab Emirates (UAE) is a federation of seven emirates that located on the
southeast coast of the Persian Gulf. Dubai is one of these emirates. Compared to USA, the
territory of UAE is much small but there are Islamic laws and civil laws that only allow some
of these emirates to sell alcohol.
The constituent emirates of UAE are Abu Dhabi (which serves as the capital), Ajman, Dubai,
Fujairah, Ras al-Khaimah, Sharjah, and Umm al-Quwain. Sharjah and Umm al-Quwain are
the cities forbid alcohol.

In our report, we mainly focus on Dubai emirate, which shares main population of the whole
UAE. Dubai lies directly within the Arabian Desert.The sand of Dubai consists mostly of
crushed shell and coral and is fine, clean and white. That makes the beaches fancy scenic
spots to attract tourists and locals. Weather in Dubai is also essential part to consider about.
Dubai has a hot desert climate. Summers in Dubai are extremely hot, windy, and humid, with
an average high around 41 C (106 F) and overnight lows around 30 C (86 F), winters are

warm with an average high of 24 C (75 F) and overnight lows of 14 C (57 F). Most days
are sunny throughout the year.
We divide the Dubai into three parts: rural, suburban and urban. Urban located near the
seaside, which has the most population of Dubai and has most of hotels, restaurants and
clubs. From the seaside to the mainland, the amount of district population decreases and there
are less hotels, restaurants and clubs in the suburban and urban.
Demographic segmentation:
Demographic segmentation is most important in Dubai market because of the globalization of
Dubai and high rate of expatriate population. We can also divide the customer by
demographic factors such as: age, gender and race. Because the Islamic laws and civil laws,
most of the Muslims are not allowed to consume alcohol and there are not our main customer
of our main produce such as Coors light and Coors Banquet. Because the population in Dubai
is almost 10 million people with about 11% of local Emirate and the rest are foreigners. Many
of foreigners either have been in the country for generations or were born in the UAE.
Approximately 85% of the expatriate population (and 71% of the emirate's total population)
was Asian, chiefly Indian (51%) and Pakistani (16%); other significant Asian groups include
Bangladeshis (9%) and Filipinos (3%).
There is also other factors like gender and age, the population of the emirate was 1,771,000
as of 2009, which included 1,370,000 males and 401,000 females. Ladies prefer to Coors
Light than Coors Banquet because of the lower alcohol content. The median age in the
emirate was about 27 years. Adult are admitted to drink alcohol, however the young people
consume more than elder people especially the young people who just reached the legal
drinking age, they consume a large amount of beers than older.
Psychographic segmentation:
Lifestyles and habits of drinking beers have a huge influence of beer sales and consumption.
Since there are so many expatriate populations from all over the world, there are different
lifestyles and drinking habits. For example, Frankfurt of Germany as a Friendship city with
Dubai since 2005, that means there are a large amount of Germans moving to Dubai to run
business or traveling, they are prefer Lager than others. However Muslims dont have any
drinking habits, but they have their preference of beverage, Coors can design non-alcohol
product focus on Muslims. Another psychographic factor is self-concept that imply customer
how they see themselves, which can be built by the function of advertising and packaging of

the beer. Even if there is forbidden for alcohol advertises on TV or billboard, the government
still allows advertisement in the clubs, restaurants and alcohol shops.
Behavioral segmentation:
Behavioral segmentation is the most powerful tool. Although according to Islamic Sharia
laws that Muslims cannot drink alcohol, there are also some special products and promotions
for special occasion, not all the Muslims refuse alcohol, some of them also consume alcohol.
But products for special occasion are still necessary, such as non-alcohol beer for Muslims
and Coors light for women. In addition, behavioral segmentation loyalty status is very
important tools to keep the old customers. In the beer industry, flavor of beer and experienced
of consumer are the loyalty status.

Targeting
After segmentation the Dubai market and customers, we figure out what are Coors target
customers and target market.
Target customers:
Adult, especially young people not only expatriate population but also the Muslims and
women who reached the legal drinking age and are allowed to consume alcohol.
Target market:
Target markets are urban and suburban districts, which have a large amount of population.
Coors should to satisfy the specific customers who have specific needs or different lifestyles
that mean they should have main product for main customers, in the same time also have
special products for special customers.

Positioning
After segmentation Dubai market and targeting our main customer and main market, Coors
should have positioning for their targeting. There are three ways of positioning we use for
fulfill consumers needs.
Functional positioning:
Because of the hot summer and the warm winter in Dubai, so the cold beer will be the main
product of Coors. Specific products for example non-alcohol beers also are very important for
Arabic countries, that allows Muslim become one of our consumers and the non-alcohol beer

also can be spread to potential markets that other countries have Islamic laws of forbidden
alcohol. It is also essential for them to have different kinds of tastes and types of beer for
foreigners who come for traveling and working.
Symbolic positioning:
Symbolic positioning must be the two main products of Coors; Coors light silver bullet and
Coors Banquet golden. The package and advertisement of the product provide self- image
and it can also symbolize the people who have different ego identification. For example, the
Coors light is the famous beer for women and the Coors banquet can be positioned to the men
who have three times population than women. For advertising, although its forbidden on TV
and billboard, Coors also can have posters for advertising in the clubs, restaurants, hotels and
alcohol shops.
Experiential positioning:
Different types of beers have different tastes, which offer the consumers different experience
that can fulfill the needs of consumers who from all over the world. There are different kinds
of beers like Lager, Bock Beer, Ale, Dry, Porter and Stout, which have different color, smell
and tastes.
They also should design special non-alcohol beer or beverage for Muslim customers, which
have totally different preference and eating habits.

7. Marketing mix - 5P:

After analyzing environment and beer industry in Dubai, then segmenting, positioning and
targeting market, it is crucial for Coors to make important decisions that lead to the execution
of a marketing plan.
Product: Coors light, Coors banquet and non-alcohol beers.
Price: Due to Dubai is a duty-free country, the price of products can be determined by Coors
and retails. Duty-free makes the profit of product higher than other countries.
Places: Hotel, club, shop (both on-trade and off-trade).
Dubai is not a big district and most of rural areas are desert. Hotels, clubs and shops are
mainly located in urban and suburban areas.
Promotion: Advertising beers that contain alcohol in nightclub, restaurant and hotel and
advertising non-alcohol beers on TV and billboard. Distributing beers with vacuum

containers by boat or road, finding local agency or distributors to help Coors distribute
products, which are more convenient and profitable than establish a brand new distribution
system in a foreign country despite Coors have their own distribution system in USA.
People: Network in a foreign country such as Dubai is the most important, which be able to
influence the sales, distribution and even the whole operation of company.
People from government and other companies might help Coors enter Dubai beer market by
providing license or joint venture. Since acquiring a permission of sale alcohol is extremely
hard and long process, joint venture or collaboration is the best way to enter Dubai market
and sell products immediately. Famous people or celebrities such as prince might help raise
public awareness of their product, for example, by asking celebrity to advertise non-alcohol
beers might stimulate customers to purchase and consume non-alcohol product.

8. Market entrance (action plan)

When a visitor landed at Dubai airport he see different world, almost everything look from
future as the Emiratis make sure to use the most updated technology and design in
everything. The visitor feel very comfortable as things moves very fast and smooth, also you
can get the feeling of living in the future but that feeling will vanishes as soon as you hit the
bureaucracy. Especially in our case, we are trying to sell prohibited material and in process of
getting the government approval to sell these prohibited materials. Its also very important to
find the right & easier place to start your business. The next lines explain the UAE market
and types of companies with general information all over the country, it will provide clear
picture to the market and make it easier to understand.
Today, more than 90% of the urban population of Dubai and more than 75% of the urban
population of Abu Dhabi are foreign nationals, the majority of which are from South Asia.
English is widely used for business and is the lingua franca of the cities, but there is
nevertheless a deep awareness within Emirati society of the countrys heritage in the face of
rapid modernization.
This Market Entry addresses some critical considerations, issues and questions confronting
companies as they establish, operate and grow a business in the Middle East from a base in
the UAE.

The Gulf Cooperation Council (GCC)

The UAE is a founding member of the Gulf Cooperation Council, a political and economic
union of the Arab monarchies of the Arabian Peninsula, namely Bahrain, Kuwait, Oman,
Qatar, Saudi Arabia and the UAE.
Foreign Investment And Business Establishment
The UAE does not have a foreign investment law, and the foreign ownership restrictions are
contained in the Commercial Companies Law (Companies Law), which requires that UAE
nationals or their wholly owned companies hold a minimum of 51% of the shares of all
companies established in the UAE. In the past, foreign investors avoided the foreign
ownership restrictions on UAE companies by entering into side agreements with UAE
shareholders by which the UAE shareholder granted the rights in their shares to the foreign
investor. In 2004, the UAE published the Commercial Concealment Law to prohibit and
criminalize these types of nominee shareholder arrangements, and the law is in force as of
2010.
The Companies Law provides for the establishment of the following business entities for
foreign investors: joint stock companies (JSC), limited liability companies (LLC),
unincorporated joint ventures, and branch offices of foreign companies. The Companies Law
does not apply to companies that are established in the free zones, which are explained below.
Limited Liability Company (LLC)
An LLC must have a minimum of two and a maximum of fifty shareholders. At least one
manager, or a board that can constitute up to five managers manages it. Shares are not freely
transferable, and all transfers must be registered with the Department of Economic
Development. There are currently no specific minimum capital requirements.
Joint Stock Company (JSC)
A JSC must have a minimum of three shareholders. A chairman, who must be a UAE
national, and a board of directors manage it, and the majority of the directors must be UAE
nationals.
Unincorporated Joint Venture
The Companies Law also recognizes contractual unincorporated joint ventures to be
established between multiple parties. Such joint ventures are common in the construction
sector.

Branch Office
A foreign company can also register a branch office in the UAE. A branch does not require
UAE national ownership of share capital but requires a UAE citizen to act as the national
agent (often referred to as a sponsor) of the branch and to conduct certain regular activities
on behalf of the branch towards the UAE public authorities.
Free Zones
In 1979, Dubai completed the construction of Jebel Ali Port, the largest port in the Middle
East and the largest man-made port in the world. Dubai established the Jebel Ali Free Zone
(JAFZ) as a customs duty-free trading zone in 1980 that allowed trade in Jebel Ali Port by
which re-exported goods were free of local customs duties. In 1992, the free zone authority
permitted business establishments to be registered free of the foreign investment restrictions
of UAE Law.
Dubai has established more than thirty free zones. Other notable free zones include Dubai
Healthcare City (DHCC) and Dubai Silicon Oasis.
In 2005, Dubai established the Dubai International Financial Centre (DIFC) as a financial
free zone.
In Abu Dhabi the key free zones are twofour54, a media free zone, Masdar City for clean
energy businesses, and Khalifa Industrial Zone Abu Dhabi (KIZAD) as a unique industrial
cluster integrated with the new Khalifa Port, which opened in December 2012. In May 2013,
Abu Dhabi announced plans to establish Global Marketplace Abu Dhabi (GMAD) as a
financial free zone in Abu Dhabi.
Other Emirates have established free zones around seaports, airports, and other industrial and
technology sectors.
Taxation
Each Emirate of the UAE has promulgated its own laws regarding taxation of income.
However, currently, no corporate taxes are collected except from companies licensed in the
banking industry and carrying out oil exploration and production in the Emirates.
There is currently no individual income tax in the UAE.
Based on the information mentioned above, the best thing is to start company branch on free
zone area located in Dubai. It will easier to receive goods and resend them to customers, and
the location in halfway to everywhere also will shortcut the distances. Also our branch office
will make contact with distributer to deliver or products, forward integration will reduce the

cost and guaranty the high sell of our products. For that we shall mention the below
information.
Contracting with Agents and Distributors
It is common to sell products and services through agents or distributors. This is the case not
just for foreign companies but also for companies established in the free zones that are not
permitted to carry out commercial activity.
Distributors and agents that are registered as commercial agents of a foreign principal are
granted substantial rights, such as automatic rights of exclusivity, automatic renewal of fixedterm agreements and protection from termination.
As such, all distributor agreements, dealer agreements, agency agreements, franchise
agreements and similar agreements must be drafted with extreme caution. Companies selling
their products and services in the Middle East need to know local law protections held by
local distributors, the agent registration system and registration mechanics, and plan ahead
about what to do if the relationship is not successful.
For the above a solid contract with distributer wills shortcut the process of sales put the sales
and delivery part on other company will reduce the cost and the managerial interferes.
Doing Business in Israel
The Arab League issued a boycott of Israel soon after its establishment in 1945, which calls
for a three-prong approach:

Primary boycott: products and services that originate in Israel

Secondary boycott: businesses that do business with Israel

Tertiary boycott: businesses that do business with boycott violators

But following the Oslo I Accords in 1994, the GCC announced it would only enforce the
primary boycott. Today, it is common for multinationals do business in both Israel and the
Arab world, and Arab League coordination on the boycott has effectively ended.
Even so, multinationals should be aware that it remains a criminal offense to import Israeli
products in the UAE and most other member states of the Arab League, and the primary
boycott is still actively enforced in most countries, with many countries maintaining a
blacklist of boycott violators.
Starting with documentation as COORS trying to sell prohibited product in UAE and trying
to get the license to sell the product. After finding the proper distributer and make joint
ventures agreement with the distributer, other process should be considered, storing the goods

and resends it to the end customer by the distributors. Hence a cold store need to be built or
rented, it should be near the port. The goods will be imported through the sea cargo with cold
containers.
For the strategic location in Middle East, the product can be send to other countries and carry
out the international sales. Also because of the religious nature of the Middle East and
restriction against alcohol, it will be wise to target new segment by make zero alcohol beer. In
fact zero alcohol beer will be big success, especially flavor beer with affordable prices. Such
product (Zero Alcohol Beer) can be manufactured in Arabic world, setting a factory in middle
east will be great advantage to sell the product in UAE and other surrounding countries.
A good connection wills powerful people in the country will guaranty the success; even the
documentation process will be easier and faster.
The main local target will be the tourist areas, as these points are authorized to sell the
products will high prices and without computation. The variety is limited to few brand names,
and prices depend on the selling point, they can charge as much as they want. Also the tourist
demand is very high as explained earlier, especially tourists from North America and Europe
will be the main customers for COORS products. Beside the tourist segment and Muslim
segment, other segments must by target with different type of beer. Also the whole sell points
must be the one of the main target, more products can be sold to individual customers.
The target plan must be gradually develop, starting from documentations, authorizations,
network, facilities and agreements with distributors and expand the distribution to
international market in surrounding countries. The UAE market can give a good advantage to
Coors as the company wants to sell more and facing problems with local market in US,
establish such market will open new gate for the firm. COORS will enter establish market,
difficulties will be existed while the market easy to get share of it.

9. Conclusion:
The UAE is one of the stable countries in the Arab region and the Middle East with a good
investments facilities which make UAE and especially Dubai are desirable for all
multinational and international companies, the modest population numbers, tourism, oil and
gas resources and the government policies helped in this growth and development.
After analyzing the environment and alcohol industry of Dubai, we find out although territory
of Dubai is not as large as America, Dubai is still extreme profitable niche market for Coors
due to the high rate population. There is no local alcohol in Dubai, Muslims are forbidden to

consume alcohol due to both mixed legal system of Islamic law and civil law, but only 11%
of them are local UAE nationals with the comprising a large amount of Dubai's total
population are expatriates who are allowed to consume alcohol and there are thousands of
tourists and businessmen come Dubai for traveling and working, which means the Dubai
market are more globalization than localization. The main restriction of Coors entrance Dubai
market is permission and license, however this problem might be solved by joint venture,
collaboration and entrepreneur network.
The market could be risky to enter if we look at the country as Muslim country and put the
xenophobia in front of our plan, but we must understand the need is such market and the
target customer. Also COORS should contact the two major licensed companies in UAE,
MMI &A+E both currently operating in the market. The third company still under
construction CDI, could be the next potential for COORS as distributer for the product
On other side, the market entrance could be done easily without advertising, as the product
well known to the tourists who represent high part of COORS customers. Working along with
existing distributors, to sell and distribute the product. COORS branch can operate from free
zone area located in Dubai; the location will be perfect in middle way to other states. Sales
can be carried on to other nearby countries, or move to Qatar, as the football world cup will
take place over there in few years.
After segmentation, positioning and targeting, we figure out our main customers (young
people) and target market (urban and suburban districts). Meanwhile, Coors also have to
design their non-alcohol beers that have Muslims-oriented flavor focus on Muslims and other
countries.
So in the future if the government changed the policies and allowed manufacturing of beers
and alcohol then Coors will be the strike force for all the Arabian and the Middle East
countries.

10. Recommended Strategy

First strategy:
Coors should start with entering the market with any kind of joint venture or partnership with
MMI or A+E companies which already have license, distribution channels and customers.in

the future Coors can make an alliance with CCD (still under construction) which have the
exclusive distribution areas in the most two biggest projects in the world.
Second strategy:
Coors can expand horizontally in the all emirates with good prices policies and import special
zero alcohol or even manufacture inside the UAE for Muslims people.
Third strategy:
Coors should concentrate in re-exporting since MMI and A+E have exportation lines to some
countries in the Middle East and Asia as in the table above.
The fourth strategy:
If Coors failed in the UAE, we have two options (qatar and sultanate of Oman) both has the
same financial and economical stability especially when qatar will host the world cup 2022
but the problem with qatar is have only one company distributor (Qatar distribution
company) and only two retails alcoholic shop so we think the sultanate of Oman will be the
next place for Coors for the following reasons:
Oman has the same regulation and laws like UAE.
Has the same stable financial and economic situation.
Oman have 5 major retailers around the sultanate:

African & Eastern (A&E) (SAME COMPANY IN DUBAI).

Oman United Agencies (OUA)

Desert Trading Company (DTC)

Marketing & Services Company (MASE)

Gulf Supply Services (GSS)

Most of Oman alcohol importation is from the UAE as in the table.