Russian alcohol brands seek distinction
When Russia opened up its market 20 years ago, it catalyzed the creation of one of the world’s largest counterfeit markets estimated to be worth 49 billion US dollars compared to the global country average of 21 billion US dollars. The alcohol, tobacco, cosmetics and pharmaceutical markets have been especially hit. Experts estimate that one-third to half of all alcohol sold in Russia is counterfeit.
The country has one of the highest alcohol consumption rates in the world. For this reason, the Russian government has been making legislative moves to reduce this rate while at the same time lowering counterfeit sales and increasing tax revenue. These various government policies related to alcohol also aim to make Russia a global player in product sales as the country looks to raise its profile by exporting more.
In the last few years, most vividly since the establishment of the Federal Service for the Regulation of Alcohol in December 2008, the country has seen visible steps towards state monopolization of alcohol sales. The most recent move has been a bill which will classify beer as alcohol.
Effective in January 2013, the government will ban sales of beer during specific time periods and at outlets like kiosks and airports. With limitations already in place on print and television advertizing for alcoholic products, and a similar ban expected for beer, it is only possible to catch the consumer at retail level.
Many brands have disappeared because of this shift. Since 2008 the number of liquor and wine producers has dropped by 40 percent and distributors by 50 percent. All of these factors point towards a need for more infrastructure in the label supply chain to support more value-add production of labels.
