Школа Александра Репьева

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A book
by A. Repiev

 

Marketing
Thinking

or
Clientomania

 

 

TOC,
Abstract & Preface
in English

 

 

The book is
available at
Amazon.com

Article in Word format

 

A glimpse of Russia's
advertising and marketing

 

By  Alexander Repiev, Moscow, Russia

 

 

Last revised: October 2011

Article in PDF format

 

 

Churchill "Russia is a riddle
wrapped in a mystery
inside an enigma."

 

– Sir Winston Churchill

And it's still pretty
much like that!

 

 

ELEVEN TIME ZONES, dozens of peoples and languages, a huge quilt of mores, religions, buying habits, per-capita incomes, distribution infrastructures, etc.

That’s Russia.

It’s been making a ponderous U-turn to a market economy. After a long hibernation, Russia awoke to find its erstwhile fantastic business traditions lost. Anyway, it was quick enough to grasp the ABC’s of modern market operations. It’s leapfrogged to plastic money, Internet, etc.

On the demise of the USSR, Russia’s economy found itself in shambles, of necessity relying on oil and gas – a fact attracting greedy Western attention, uninvited Western advice (often based on double standard), and Western lectures on “democracy” (especially funny when coming from some blatantly police states).

What saddens me a lot is the fact that Russia, a gold mine of scientific ideas, inventions and R&D expertise, does not benefit from it. This intellectual treasure lays idle because of the lack of commercialization skills and adequate marketing savvy.

But things are improving.

An exciting place. An exciting time. Like the days of Peter the Great.

Some history

In 1914 the growth rate of Russian economy was higher than that of the United States. Russian industrialists and merchants were a good match to their foreign counterparts. And the Russian advertising of the day was fairly advanced. Browsing through the yellowed pages of old Russian newspapers and magazines one comes across some fantastic specimens. The Russian trade literature of the period carried good editorials on various aspects of commerce and advertising.

After the Bolshevik revolution there was a short-lived renaissance of market economy in the 1920s, remembered by advertising historians for Vladimir Mayakovsky’s poster doggerels in his ragged style unreadable by barely literate post-revolutionary public.

Some advertising lingered on for a while: then it vanished from Russian life for decades, to be regarded as one of the “villainies” of capitalism.

The only advertising agency in those days was Vneshtorgreklama (a Russian abbreviation for “foreign trade advertising”), an unwieldy and amateurish institution under the Ministry of Foreign Trade, which produced ads in foreign languages for the constellation of foreign-trade organizations.

In 1966, when I began freelancing there as English-language copywriter, there were no literature on advertising, no courses, no contacts with Western advertising communities, no nothing. Those were the days of the Iron Curtain.

Perestroika

Overnight Russia found itself in a new system, of which it had had absolutely no idea. The early private businesses were extremely primitive, largely involved in box-moving to feed the Russian markets starving for Western goodies.

In the early Perestroika days, the days of unsaturated markets and huge markups, operators were not concerned with marketing or the quality of their ads.

Early ad agencies were yet more primitive, mostly set up by a couple of guys with a computer, blithely unaware of things marketing & advertising. Their “advertising” simply directed ex-Soviets to where they could buy something previously unknown.

After the frantic years of no competition, and no need for real selling skills (“they simply buy from us”), Russian businesses found themselves in the hostile environment of saturated markets, harsh competition, and commoditization. They found themselves unprepared to deal with the overproposed, cynical customer armed with the Internet. Earlier adverts, which had been essentially price lists, stopped to pull.

Many firms floundered and disappeared. The survivors began to think about marketing and more professional advertising and look for those who could make it for them. Mostly to no avail, though.

It became fashionable to set up a marketing department, to hire marketing graduates and MBA’s. Many organizations began to seek marketing advice from Russian and/or Western consultancies.

Although welcome developments, many marketing efforts are mismanaged, with the result that some marketing departments are closed down.

The main way of getting some marketing expertise in Russia is by trial and error. It was so back in 1988, when I became Marketing Director at the Xerox office in Moscow, and it is pretty much the same now. Anyway, I have witnessed some progress since 1995, when I quitted as VP Marketing at a Texan-based company and started an agency in Moscow.

To educate the Russian business, I set up in 2001 a School of Marketing & Advertising and authored books “The Savvy Advertiser” (translated into Bulgarian) and “Marketing Thinking, or Clientomania” (also available in English at Amazon.com).

Importance of marketing &
advertising in Russia

Western companies that, like Xerox, normally rely on their efficient selling forces, are quick to discover that for them to extrapolate their tactics to Russia’s open spaces, they would need huge selling armies, which is impossible. They have to opt for marketing means. Thus,


Russia is a classical marketing country.


 

Marketing and advertising in Russia are more important than elsewhere. Analysis of evidence gleaned over years shows that the quality of marketing and advertising is often a make-or-break thing for Russian companies. And not only for Russian ones, for that matter.

Marketing

To be a practitioner of marketing and advertising in Russia is no easy task. Marketingwise, Russia is not a “country”; it is rather a huge sparsely populated landmass to which no unified marketing concept applies. For centuries it has been home for dozens of Slavic, Turkic, Finno-Ugric, and many other peoples, a melting pot of cultures.

If you superimpose that mosaic on a bizarre array of regional differences in traditions, ways of life, values, predominant occupations, buying habits, and what not, you will end up with a fascinating kaleidoscope of marketing patterns and recipes.

In practical terms that means that what sells perfectly all right in Moscow, may not appeal to buyers in St. Petersburg, and even less so in Siberia. The number of possible marketing situations you may find in Russia may baffle description.

What is more, Russian markets are so dynamic that selling points that work today may become out of place tomorrow.

You might imagine, with the country being like that, that skills of top-notch marketers and advertising agents must be in great demand. Nothing of the sort.

Statistics

In Russia there are no reliable national statistics. The country used to be a very closed society. Information about people, media, distribution, material and labor resources, business laws, institutions and traditions was either unavailable to outsiders or did not exist at all.

Official data may be wildly inaccurate. One example is Russian income statistics. Few analysts trust it, for they know that fears of draconian taxes and organized crime have led to widespread under-reporting. Russia’s official information collection system often supplies data that is irrelevant and Soviet-style. Another problem: with things changing in Russia by the day, any information may become dated before going to press.

Because there is so little reliable data around on which to draw for predictions, marketing in Russia is mostly a qualitative rather than quantitative exercise. Emphasis is necessarily on marketing as a craft, experience and intuition often being more productive than formal quantitative methods. For good and ill.

Distribution

In Western markets, firms are used to well-defined ready-made distribution channels. In Russia, they are just taking shape in some industries. Western firms seeking to establish their existence in Russia are well-advised to cultivate personal relations with agents, to proceed incrementally, and to retain a fall-back position should a relationship sour.

Experience has shown that perhaps the highest-risk strategy is to visit Russia once or twice, select an agent and grant him exclusive representation, then move quickly to consignment or credit sales, without establishing a consistent track record first.

Russian agents can help the foreign supplier by placing his products on store shelves, handling customs, transportation matters and other operations. It is only rarely that they can be entrusted with sophisticated marketing and advertising projects.

Internet potential

It is clear that in a “country” with eleven time zones the Internet must hold a huge promise. Unfortunately, the Russian Internet is not up to the mark, largely because it is still dominated by designers and programmers, as it was the case in the USA before the dot.com bubble burst of 2000.

Fortunately, things are improving: more and more marketers and copywriters are getting involved. The marketing quality of sites is getting better.

No marketing "academia"

Ironically, being a late starter in a market economy has some good thing to it – unlike the US, for instance, we do not have in Russia an army of ivory-tower marketing "academia" and no "learned" marketing journals – that frightful heap of unread junk. Russian magazines generally prefer down-to-earth how-to articles.

Advertising

The Russian advertising scene can be best described by the Biblical phrase: the blind leading the blind. Blind agencies leading blind advertisers.

The quality of ads in Russia is horrible for two reasons. For one thing, most of Russian advertisers don’t have the slightest idea of what good advertising is about. For the other, the same pretty much goes for Russian ad-makers (including those who man local branches of Western chain agencies). The ads they produce are all too often a waste of the client’s money.

Oddly enough, you stand better chances to find good, down-to-earth, advertising that sells not in Moscow, but in other Russia’s places. One reason is that provincial agencies are not spoiled by huge ad budgets of the internationals, which is the case in Moscow. Of necessity, they have to supply the goodies to local manufacturers or retailers for their hard earned advertising monies.

Russian adfolks

Since its renaissance several years ago, Russian advertising has been attracting a wild assortment of characters: designers concerned with self-expression (at the customer’s expense); printers who think that tinkering with ads is just an easy and lucrative addition to their businesses.

Unfortunately, it attracts all too few marketers and sales experts, account planners, and copywriters.

There being no educators with practical experience, Russian ad schools are attracting a crowd of ivory-tower scholars (psychologists, psycholinguists, culturologists, etc.), and "artists."

CreAtinism

Most of Russian agencies still view advertising as an exercise in design and graphic arts. David Ogilvy used to call this disease art-directoritis. I call it “creAtinism.”

The disease worsened with the coming of fancy graphical computer packages, which enable a third-rate designer to get a motley background, reversed text or other ad-killing tricks in a matter of seconds. With nobody minding.

Those creatures believe that their task is simply to “beautify” with graphical frills some text provided by the advertiser.

Only few understand that it is basically the copy that sells.

No copywriting of note

When we were establishing our agency in 1995, we went out looking for copywriters. And found none! MD of one prosperous agency volunteered that the market didn’t need copywriting and "selling" advertising in general. It was allegedly simply happy with “pretty pictures.”

Copywriting is still a craft practically unheard of at a sizeable proportion of Russian agencies. Even at international chain agencies in Moscow they may have just some rudimentary copywriting. So, at McCann Erickson Russia they told me that copywriting is just about "Just do it!"-style sloganistics.

What little copywriting the agencies have is generally relegated to underpaid ex-journalists or linguists absolutely innocent of things marketing and advertising. And even then it is mostly about thinking up some funny slogans.

A new fad is so-called SEO-"copywriting."

Ad agencies

There are thousands of firms in Russia that call themselves advertising agencies. Most of those shops are basically design boutiques. They concentrate on logos, business cards, stationery, outdoor engineering structures, souvenirs, and other advertising marginalia.

Their ultimate dream is to grab some prize at one of those ad contests, one sees so many around. Courtesy of those shows, some green Russian agencies found themselves involved in the award rat race. (Ogilvy: “The Lunatics Have Taken Over the Asylum.”)

Chain agencies in Russia

Dozens of Western agencies have opened their shops in Russia. Most offices of these international grandees have “all the signs of famous agencies which are moribund” (D. Ogilvy), perfect “ministries of advertising” housed in posh offices. Those outfits put you in mind of infamous Soviet-style bureaucracy. Inefficient, expensive, and, well... “moribund.”

They mostly don’t have to bother about recruiting advertisers in Russia: their worldwide clients who establish their presences in Russia simply fall into their laps. The bulk of their job is simply dubbing Western commercials and outdoor ads created in Alabama, Bavaria, Yorkshire, or elsewhere – it is supposed that advertising “gurus” there know better how to sell to a Russian housewife or a Russian shopkeeper. With funny results sometimes. Examples are legion.

The chain agencies are just fond of enlightening green Russian adfolks, e.g., like this:

Most of them follow these precepts themselves. I believe David Ogilvy is turning in his grave.

"Branding"

As the fairly technical “branding” of the mid-20th century (based on the AMA definition of “brand”) has gradually turned into the schizoid “branding” of our days, Russia, with its rudimentary marketing culture and psychological predisposition for wishful thinking, was severely hit by “brand hysteria.” Just like elsewhere, nobody in Russia knows what the word “brand” means.

Some believe that a good “brand” is just a good name, or a properly designed label on a bottle. (Some pay as much as $400,000 for a vodka label, mostly to UK “brand” companies.) Why bother with client insights, product quality, ad policy, sales guides, etc.!

At the same time, some Western companies are making good money in Russia with their “Russian” trademarks in cigarettes, beer, detergents, etc.

Western marketing & advertising in Russia

Western companies that have succeeded in Russia have done so through a combination of improvisation and innovation, combined with a substantial investment of time and ability to learn from mistakes. In Russia, international businesses have to show more flexibility and understanding. It is only at their peril that they can continue to behave the way most of them have behaved in their home markets.

Unfortunately, some Western firms, especially mammoth blue-chips, continue to mechanically translate their marketing methods and advertising ideas to Russia – why bother, if you are a huge bureaucratic monster.

Having squandered millions, they sit on the fence and wait for results. More often than not, nothing happens. They may wonder why methods that have worked perfectly all right in other places turned out to be useless in that funny market.

Some, however, learn from their mistakes and revamp their marketing and advertising philosophies.

There are several reasons for failures of those mechanical marketing grafts. Some are highlighted below.

Need to review the selling points

Years of experience with the Russian operations of major Western companies have taught me that a Western product's selling points have often to be re-considered for Russia. A company's solutions may have advantages that work all right in Europe or elsewhere, but not in Russia. On the other hand, some corporate or product features may appear to be excellent selling points in Russia. It is only rarely that Western companies do such a review.

One example: our careful analysis of Minolta office equipment unearthed an impressive collection of advantages for Russia (which might be not that important elsewhere). A campaign "Minolta office equipment is ideal for the rigors of Russia!" stressed tolerance to faults, static electricity, bad power, low-quality paper, etc. In a country, where equipment is largely not grounded, where power supply is often horrible, etc., that fine-tuning sold many pieces, even to foreign rep offices in Moscow.

"Russifying"

The popular practice of many Westerners in Russia is to have their ads hastily done into Russian. Some even do that in London. The consequences of that practice depend on the field.

Whereas the bad Russian of high-tech brochures may simply amuse Russian readerships and… still work, nevertheless; bad FMCG commercials and outdoors are often above the heads of most Russians.

Mechanistic, unimaginative “russifying” may appear to be a formidable task even linguistically.

The Russian language

With its host of suffixes and prefixes, and idiomatic flourishes, Russian is extremely colorful in fiction. On the other hand: (a) its words are generally longer than, say, in English; (b) its word-forming power is lower; (c) many words, especially in high technologies, can only be translated into Russian using two lines or so.

Examples are “computing,” “networking,” “full-featured,” “sharing,” etc. In the body of a copy an experienced copywriter can handle this, but titles and headlines that include “problem” English words may look extremely cumbersome when translated. Even the nice English phrase “simply the best” will be a problem for a Russian translator.

Russia is now flooded with foreign names of products that tell absolutely nothing to an average Russian. Some of the names are excellent self-explanatory sellers in English – Deep Cleanser, Head-and-Shoulders, Wash-and-Go, Handy Stitch, Coldrex, etc., etc. Admittedly, those names are a problem in other languages, but most Europeans can at least work out their meanings. For Slavs nearly all of them are double Greek. To make up for that takes some talent.

Slogans

Some international companies come to Russia with untranslatable or meaningless slogans. Examples are galore. Nobody in Russia can properly translate Nike’s “Just do it,” Microsoft’s, “We are rolling out the wheels.”

For Xerox, that pioneer of copying, we thought up and tested “We taught the world to copy.” We had the Russian, Ukrainian and Byelorussia versions of the line. It was replaced by “The Document Company.” In Russia, where it is used in English at that (!?), nobody can understand it. Besides, in the post-Soviet environment the phrase has a police connotation – in Russian the first meaning of the word dokumenty is ID.

Some Western marketing gaffes in Russia

The more bureaucratic and inflexible a foreign company is in Russia, the more likely it is to make mistakes, some of which can be quite expensive. The following are some of them.

Outlandish product categories

Sometimes international companies come to Russia with classes of products that are unheard of here or have had adequate substitutes for decades or even centuries. Instead of educating the market, those internationals may set out to promote their unknown products the way they do in places where those products are well-known and popular.

One example: in Russia, that vodka land, one sees outdoor whiskey ads produced for markets where those brands are just household names and need only some reminding. Headlines and straplines are often “blind,” not infrequently they are in English. Some ads do not even show the bottle, just the label.

For instance, Johnny Walker hit Russia with an expensive “We are walking” campaign. Perhaps a stunning success in England (which I doubt), that far-fetched double-play (Walker – walking) dubbed into Russian was lost on nearly 100% of Russians, most of whom have never so much as tasted whiskey in their lives.

Improvised polls conducted by students reveal that a sizable percentage of Russians cannot even identify some Western product categories, let alone products. Why such a predictable waste!

Trademark awareness

A mark may be an "icon" in its home market, but… enjoy a low or nil awareness elsewhere. What should you do? Gauge the awareness at first, and make adjustments to your marketing? Or you may well plunge head on into the market with a million-worth marketing and ad project? Most foreign behemoths in Russia prefer the latter scenario.

One example is Nike. When it came to Russia, which had largely been an Adidas land, its awareness here was as good as nil. Also, nobody in Russia was crazy about US athletic endorsers. But Nike began mechanistically swooshing Russia all over. Why bother and fine-tune things! We are the big great Nike!

Cultural differences

Some companies in Russia demonstrate contempt for cross-cultural approaches.

Just one example – dozens of Baccardi billboards in Moscow showed a huge ugly bat. It may well be that in Calabria, the home of the Baccardi family, the bat is a symbol of wisdom, etc. But in Russia it is… a repugnant monster.

In addition, the company did not bother to explain rum to Russian vodka drinkers, specifically that it is not taken straight, the way Russians consume drinks. That didn’t help the product along in Russia, to put it mildly.

It looks like though that ever fewer Western companies err this way with years.

Consulting

In Russia, when tax, legal and marketing problems are concerned, an ounce of prevention can be worth a pound of cure. A piece of seasoned advice early on can save you both aggravation and money down the road.

In Russia you will find all the major consulting grandees, such as McKinsey. Overall, they are professional, efficient, and… expensive. They all have one problem: their stock-in-trade is off-the-shelf solutions, which may work just fine elsewhere, but not uncommonly they fail in Russia.

Russian consultancies, on the other hand, may be not that impressive, but they have more local knowledge. Some of them are good one-hundred-odd-ball fixers.

Lloyd Donaldson, a Westerner with years of experience in Russia’s business, comments on getting advice in Russia: “What that boils down to is getting the right person for the job. A professional consultant with personal experience in observing the marketing in practice could be the right choice. Such a consultant, using an experience-based model, would help you appraise your product and its entry into the Russian market on the basis of past successes. That could be the key that unlocks success in the Russian market for your firm.”

In Russia’s marketing quilt, when penetrating some regional markets with major local differences, e.g., Muslim areas, it would be a good idea to get a local adviser. We have learned that the hard way, by trial and error.

Our Mekka Consulting is a fusion of Western expertise with local knowledge.

Quo vadis?

To survive in the new environment of hyper-competition Russian business will need new marketing thinking.

Thank God, Russian marketing is improving. At the moment it’s mostly experimenting with ready-made Western marketing concepts. With funny results sometimes.

There comes an understanding that some aspects of international marketing are unsuitable to the bizarre markets of Russia, so that Russian marketers should be coached somewhat differently (see "Kotler and Kotleroids").

Well, but how should marketing be taught to Russians, half-Asians – half-Europeans? In his famous poem “Scythians,” the Russian poet Alexander Blok wrote:

 

Yes, Scythians we are, and Asiatics,
With slanting and devouring ogles.

We worship all – the flames of icy digits
And gifts of the angelic visions,
We fathom all – the spicy Gallic spirit,
And ominous Germanic genius…

 

I do hope that sooner or later Russia will develop its own Eurasian school of thought in marketing & advertising, based on the best of the two worlds, the East and the West.

But I don’t know whether or not Russia will become less of “a riddle, wrapped in a mystery.”

 

Article in PDF format

 

Other English-language articles by A. Repiev

Kotler and kotleroids

Pseudomarketing: scholasticism and bureaucracy

The Soap Bubble of "22 Immutable Laws of Marketing"— Review

Lunatics have taken over the asylum

The Augean stables of academic marketing

"Physics envy" – physics abysmally misconstrued!

 


 

 

Russians are
slow to harness,
but fast to drive.

Otto von
Bismarck

The Americans
will always do
the right thing...
After they've
exhausted all
the alternatives.
Sir W. Churchill

Scratch
a Russian
and you'll
find a Tartar.

A proverb

An invasion
of armies can
be resisted,
but not an idea
whose time
has come.

V. Hugo

The best thing
we can do
if we want
the Russians
to let us be
Americans is
to let the Russians
be Russian.
George F. Kennan

There is
nothing more
 difficult to
carry out,
nor more
doubtful of
success than
to initiate
a new order
of things.

N. Machiavelli

To know the
road ahead,
ask those
coming back.

Chinese
Proverb

What's good
for a Russian
is deadly for
a German.

A proverb

Nothing is
more dangerous
than an idea
when it is
the only one
you have.

E. Chartier

Experience
is the name
everyone gives
to their
mistakes.

O. Wilde

So much of
what we call
management
consists of
making it
difficult
for people
to work.

P. Drucker

It is not
the strongest
of the species
that survive,
nor the most
intelligent,
but the one
most responsive
to change.

Ch. Darwin

Think!
IBM motto

 

 

 

info@horses.ru
+7 499 194-5221