x Abu Dhabi, UAETuesday 25 July 2017

Hotel openings boost Diageo sales

Diageo, the global drinks maker with brands that include Guinness, Johnnie Walker and Smirnoff, says sales are surging in Abu Dhabi as a raft of new hotels openings boost demand.

Diageo, the global drinks maker with brands that include Guinness, Johnnie Walker and Smirnoff, says sales are surging in Abu Dhabi as a raft of new hotel openings boost demand.

The growth comes as the company, based in London, reported a 16 per cent increase in net sales across the MENA region, despite strict restrictions on the advertising and sale of alcohol in many countries.

The company, which is the world's largest producer of spirits, said it had a 28 per cent rise in demand for domestic sales in Abu Dhabi in the 2010 fiscal year compared with the previous year.

"We're very excited about Abu Dhabi," said Hugo Mills, the general manager in the Gulf region for Diageo.

"I think they are very clear about what they want to establish Abu Dhabi as, as a destination globally. I think we can safely say that will be a core market for us within the next eight to 10 years."

In a market such as Lebanon, the company has relative freedom to advertise. But in the GCC countries in which it is allowed to operate, there are many restrictions.

Diageo works with African and Eastern as its third-party distributor in the country.

"We strongly believe that the combination of global travel and Middle East and North Africa is set for growth," said Jane Ewing, the managing director of Diageo's Global Travel and Middle East business. "We think both of those elements of the business can double over the next five years."

Dubai Duty Free is the single largest airport retail operation in the world, with sales last year of US$1.14 billion (Dh4.18bn).

Travel retail sales at Dubai International Airport helped business during the downturn.

In the MENA region, about a third of the company's business is in travel retail and two thirds is domestic.

A key part of this involves luring travellers, who typically spend between three and four hours at an airport, into stores.

Diageo yesterday launched its Emporium store in Dubai International Airport, the first in the world, as it seeks further ways of promoting its brand there and boosting sales.

Mr Mills said domestic demand in Dubai was "starting to show signs of recovery".

 

rbundhun@thenational.ae