Strong Alcohol Market in Russia
The consumption of alcoholic beverages in Russia and Post-Soviet republics is the highest in the world. The rate of consumption of alcohol in Russia remains at a very high level of around 90 liters per capita. The main strong alcoholic beverages, produced by Russian manufacturers are vodka, cognac, brandy and liqueurs. Other alcoholic beverages from the category of strong (gin, whiskey, tequila, etc.
) are mostly imported from foreign countries. It is not a secret that vodka is the most consumed strong alcohol in Russia, with the market share of 97% among strong alcohol drinks.But due to increasing people’s welfare and income growth, which is 5% per year, vodka consumption is decreasing every year. At the same time, consumption of luxury drinks in Russia (such as whiskey, gin and cognac) is increasing by 50%-70% per year, where whiskey becomes the fastest growing category in this segment.
In other words, average decrease of vodka market share by 1 percent a year, provides 30-50 percent of annual growth for luxury alcohol brands.The first Beam’s product destined for Russian market was Jim Beam White, the most popular bourbon in the world, followed by Jim Beam Black, Knob Creel, Basil Hayden’s, Baker’s and Bookers. For example, annual sales growth of Jim beam White in Russia was 87% in 2011, followed by Jim Beam Black with 24% increase in sales. The target audience of Beam’s products in Russia is young, independent and active people, who are open for everything new in their lives.
For example, Beam’s new advertising campaign in Russia addresses the growing need for the eternal and true values.Creative concept of the campaign says that a modern artificial things around us (the way we look, communicate, take decisions, or being influenced by popular opinions of others) create an illusory world of imitators and fakes, in which a man loses himself. Potential threats for the company are constantly changing local regulations concerning alcohol sales and imports. For example, recently approved new law prohibits alcohol advertising online and in printed media.
All ads will be prohibited outdoors, on TV 24 hours per day, including subscription channels, and in airports, railway, and bus stations.Also, alcohol producers can no longer organize events where buying alcohol is necessary to participate. However, alcohol producers, advertisers and legal teams are already looking how to get around the new laws, because the law is stated vaguely and lawyers could get around it if necessary. Also, it is not yet clear how the ban on online alcohol marketing will be monitored and upheld. As we can see on the chart, among all alcoholic beverages vodka represents 50%, followed by wine and low-alcohol drinks, such as beer and different cocktails. Read about
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com/6-strong-acids-and-6-strong-bases-flash-cards/”>6 Strong AcidsLuxury products, such as whiskey, cognac and brandy represent only 3% of market share, but due to constant decrease in vodka consumption, this market shows great potential and strong growth. If most of the whiskey brands spend a lot of money for advertising, trying to create an illusory image, Jim Beam is focusing its advertising on objective rational advantages, such as taste of product. Russian advertising campaign of Jim Beam brands is a combination of online and offline communication. The company created a website, where the visitors can check all the information about Jim Beam products.Another step was to create a mobile application: a catalog of legendary cocktails on basis of bourbon, providing the history of gangsters and dry law.
Company used popular video hosting and social network websites to upload their commercials and news. The main part of advertising campaign in Russia was project called “Competition of tastes”: where during several months, the company launched a blind test in the bars all over the country, where people could taste two drinks, Jim Beam and his main competitor (Jack Daniels). The results showed that over 10,000 tastings, 74% of the audience have chosen Jim Beam.