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11 Feb, 2009 18:00

Focus on price brings Russian producers back into the hearts of consumers

One of the effects of worsening economic conditions is that consumers focus more on price, and less on brand names and marketing. That’s seeing Russian producers get the chance to win back the trust of consumers.

According to studies 70% of Russia’s population remains unaffected by the economic slowdown, but it is starting to bring about changes in consumption patterns.

Sales of electronic white goods are down 10% year on year, but there is a silver lining for Russian producers, according to Aleksandr Demidov, General Director of Rus Research Company, with consumers increasingly focusing on price.

“There was a tendency toward civilized consumption where the level of service, the atmosphere in the store, the information available, was important, and the price factor was less important. Currently the price is one of the main factors of purchasing.”

Some Russian branding has sought to cash in on the consumer preference for international sounding names – associating them with better quality, and service in particular. Household Electronics maker, Bork, and dairy and juicemaker, Wimm-Bill-Dann, are two well known examples.

But Demidov sees the focus on price giving Russian producers the opportunity to show customers a new face, and to improve their image

“It's a favourable time for the domestic goods. If Russian producer will be able to change the image of Russian made goods in eyes of the consumers.”

With Russian consumers turning to domestically produced goods, Russian brand names have the chance to reverse a generations worth of increasing focus on global brands. If they take up the chance successfully it could become a manufacturing growth story – at a time when more commentators are saying Russia needs to move beyond commodities.