Strong Alcohol Market in Russia
Why they enter that market?
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
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