Mark, cheers for taking the time out to talk with us here at 12×75.com
12×75 : Tell us a little bit about how you got into the wine business, and moreover how your past role translates to what you do now?
I needed a change from having a very corporate and successful career as a Supply Chain Director for the leading supermarket and off-licence operator in Holland. About to turn 40, I wanted to do something I was passionate about. Which is trading, fine wine and running a proper business. Lots of people think my background was instrumental in setting up DWT because of the network, but the real value lies in understanding how you run a business that customers appreciate.
12×75 : Your slogan is “Making Fine Wine Accessible”. In addition to this, what makes Dittons a strong brand in the market?
The slogan really captures it very well. I do want to give customers the real thing i.e the right wines, no nonsense and at the most competitive prices possible. That’s the back-bone of everything we do. I’m not interested in making as much money as possible. Instead, I believe that if you do what’s right for your customer, it will be right for DWT. The company I used to work for had a statue in front of the main entrance to HQ, of an elderly lady with a shopping bag, titled “lest we forget who we work for”. I will always remember that and I passionately believe in that message. Some people have called me naive for that. I just think it’s the only way I want to work as well as the best sustainable route for DWT. And that, to answer your question, is what I believe makes DWT a brand.
12×75 : I must confess, I’m a fiend for Wine Searcher, and like many other investors, I go to the cheapest, most reliable / recommended sources. This is how I became a client of Dittons two years ago. How is it that you are consistently able to be cheaper than a lot of your competitors?
Primarily the desire to be the cheapest. Yes, our margins are lower than some of the competition but so are our costs. We run a small and effective operation, focussing on being very good at buying and only spending money if it adds real value to our customers. The result is that our bottom line is very healthy and that we have customers that know they had a good deal.
12×75 : Since October 2008, you have run your own blog. A large number of your posts have been based around the investment side of the market. Given that the last few years have been remarkable in the wine market, how would you describe the current downturn, and in your opinion what are the reasons?
First of all, I think the price drops are both healthy and long coming. No market can keep going up like fine wine did in the last 2-3 years. This correction allows for a period of consolidation, reflection and normalization. Which ultimately avoids boom/bust scenario’s. The reasons for the current downturn are 1) profit taking, 2) there’s a lot of stock in China, unsold, bought while prices were going up, whilst 3) there’s a general nervousness or even fear in the financial markets, which has subdued demand for the moment. It’s all about supply and demand, I think the fundamentals for wine investment are unchanged and very sound. Do read our BLOG if you want to know more!
12×75 : Do you think the day will ever come where Merchants will struggle to source First Growths in Europe, and will have to start sourcing them from HK?
No. There’s still an enormous amount of stock in Europe. Moreover – contrary to popular belief – the majority of current sales are still to European customers. We will likely see Asia become even more important than it already is, but both because of the history and existing, often long standing relations between suppliers and customers, I don’t think it will get to the point where the vast majority of 1stGrowths will be sold directly to Asia. Regarding sourcing from HK, this will not happen unless providence can be absolutely guaranteed, something I don’t see happening in the near future because of climatic conditions and risk of counterfeit. At the moment, we don’t touch any stock ex HK, none. And as far as I’m aware, no other reputable merchant does either.
12×75 : I’ve noticed that as time progressed, your wine list has grown outside the realms of Bordeaux. You now have a section for Burgundy and Italian Wines. Do you believe these are good investments, and if so why?
Burgundies yes, they are the hot item at the moment. Although for investment purposes, it will never even come close to Bordeaux, which will always be the backbone of any wine investment portfolio. For us, the Italian wines, although some have already proven to be a lucrative buy, are not about investment. I have had my eye on top Piedmont’s and Tuscans for a while now, because they are stunning wines and although not cheap, they do provide wine lovers with an exceptional value for money. They have an interesting story to tell and it’s a very powerful alternative to Bordeaux. We recently sold quite a bit to Asia so who knows, maybe the smart money will include Italians in their portfolio.
12×75 : Dittons has of course not been around as long as some of the older houses, yet has carved a place in the market with good prices and clever marketing. DWT use social media very well and also sponsored the En Primeur campaign this year on Decanter. Do you believe that the ‘buying crowd’ are responding more and more to online campaigns?
Definitely. Online is immensely powerful, primarily for brand building. Think about it. What do you do when you want to know something? Chances are you’ll Google it. The wine business has been quite slow to embrace online, but they have now. Everybody makes an effort on their website. A lot are on FB and Twitter, although the majority of the efforts lack strategy and conviction. There’s still massive potential there to distinguish your brand, but just tweeting or FB-ing won’t do – you need to add value and the way to do that will transform and will become more difficult. But get it right and you might go viral!
12×75 : On your website, you have a photo of yourself. Who took the photo?
Lol. That’s what I like about 12×75, these funny, random questions! My dad. You should have seen the original photo though, I had to crop out my kids. It’s interesting you should comment on it, as loads of people know the picture and indeed associate my name with DWT to the extend where it’s almost synonymous. Should have had a haircut first though..
12×75 : 12×75.com have heard many stories of Chinese Drinkers mixing their wines with coca cola? Is this true, and if so does it have to be coca cola, or would Tango or Red Bull do ?
I think you should phone up some high profile Chinese wine lovers, ask them and publish the answer here on the blog. They’d probably love to share their story!
12×75 : If I had £5,000 today to spend with Dittons, what advice would I be given?
Today, I’d say phone back in 2 weeks as you’ll probably get a better deal. But do phone back because if you wait too long, you might have missed the elusive bottom-of-the-market.
12×75 : Where do you think the Fine Wine Market will be in the next ten years?
Blimey, nice closer. Ten years is a long time but here goes: Robert Parker has finally retired, just. The market will be far more transparent, regulated and professional and fine wine is a widely accepted alternative investment. The current supply chain will look different, with more direct contact between growers and drinkers. A surprisingly large amount of fine wine suppliers will have been victim of a shake-out, unable to get away with sub-par value to their customers. Prices for the icon wines will defy current belief, but only if of proven provenance. The role of the internet in selling fine wine will be crucial, although the Bordelais will probably just have started tweeting. They might be on Wine Searcher though.
12×75.com would like to thank Mark for this ‘interview’. Mark has been a good friend to us here at 12×75.com. As a personal client of Dittons, I can only tell you that I’ve enjoyed buying stock for myself and friends at some of the best prices available. To speak to Mark directly, please call him at Ditton Wine Traders on 0208 339 9112. – The Editor