The Licensing@Russia trade show and conference – the first ever international licensing industry show and conference held in Russia – proved to be a huge success, with delegates from across the world attending an absorbing and rewarding three days of talks, presentations, screenings and networking opportunities at Moscow’s Crocus Expo International Exhibition Centre from March 14th to 16th 2012.
The organisers had certainly worked hard to make sure everything was in place to ensure a successful show and conference – the venue is one of the biggest exhibition facilities in the world and Licensing@Russia shared the same exhibition hall with major international stationary fair Skrepka, whilst another big international exhibition - Toys & Kids Russia – took place in the neighbouring hall. Attendees, exhibitors and visitors from each of these events enjoyed free access to the other two, ensuring that a total of around 16000 professionals had access to a vast range of resources, exhibitors and networking opportunities.
The strength and number of delegates was also impressive, with professionals from executive level, opinion makers and market leaders all attending the show. Approximately 30% of these were from the international licensing community – reflecting the increasing global importance of the Russian market.
What the show successfully portrayed is the huge potential that is inherent within the Russian market, something that is very much borne out by the facts and figures. Combined with neighbouring markets, Russia has about 300 million affluent consumers who are part of a growing middle class that boosts the consumer goods business in the country - a size that is roughly equal to the United States. Russia itself, with a population of 142 million, is the largest consumer market in Central and Eastern Europe.
Moscow – ranked as the largest city in Europe, beating even London – is obviously at the centre of things and a recent survey identified it as the most desirable European city for companies to expand into for the second year running. One of the factors driving Moscow's popularity as a destination is an increasing focus by European companies on growth markets such as Russia.
A large and newly-affluent urban population in Moscow and Russia’s other major cities provides a big boost to the development of the retail market in the country and the Russian economy is slated to become the second-largest in Europe by 2013 behind Germany, whilst 70% of income earned by Russians is disposable - compared with around 40% for Western consumers.
Facts related to the licensing business show the importance of the Russian market for Hollywood studios looking for growth markets. Box office revenues in the country have soared over the past decade to more than $1bn, rising at a compound annual rate of 27% since 2006. Russia’s growth has outpaced both established markets and emerging markets such as China and there is a cultural revolution under way in terms of people embracing cinema. The Russian market is where Disney and other film companies will increasingly be seeking to generate momentum for a franchise.
In five years, the Russian media market will have grown 1.7 times and will be worth USD 35.7bn. All media segments will demonstrate positive growth in 2011 - 2015 and almost all segments of the Russian media market will demonstrate faster growth rates than their counterparts in the global market. The Russian toy market is also the world leader for growth - with experts talking of rates of 10% to 15% a year for children‘s products. Predictions for the licensing market as a whole is for growth by 18% to 24% a year over the next three to five year.
Over the past decade, retail trade in Russia has grown at a blistering pace, increasing six-fold to reach a total value of $621bn in 2011. Retail sales are still growing strongly, rising 7.2% in 2011 versus 6.3% in 2010. From this year on, Russia is expected to start conquering consumer category after consumer category. In 2011, Russia became the largest market for milk and children's goods, and this year it is due to become the biggest dairy market. In 2013, the country will take the top spot for advertising and apparel and by 2020, Russia should be the biggest consumer market in Europe.
The current position of the licensing business can be likened to the USA 15 or 20 years ago and represents the perfect time for the international licensing industry to break into the Russian market. The international licensing business wants to find reliable partners for developing business in Russia and CIS and companies from this region are likely to be increasingly recognized and more visible internationally.
It is this astonishing growth in terms of prosperity, economy and appetite for consumer goods that has made Russia such a growth territory in licensing terms and this is what visitors to Licensing@Russia came to understand and experience at first hand.
Attendees were certainly impressed with the show and the prospects it presented – Janet Woodward of JELC amongst them:
“Our decision to exhibit at Licensing Russia was made for the purpose of launching our new Russian agency, Brand Extensions Russia JJB, and to introduce ourselves to the Russian market. We had no pre-conceived ideas about the level of new business we would write at the show. However we have been delighted and surprised by the strength of the interest in our portfolio with several stand out brands but in particular Gem Fairies. The show has reinforced our belief that Russia is an exciting market with immense potential if approached correctly”
Added Roman Chetvertkov from Russian based agency Megalicense ”Foreign visitors to the exhibition were plentiful giving great opportunities to talk all together face to face, here in Moscow. Many non-Russian visitorsbegan to realize that Russian market is not the Klondike, but rather a complicated marked with its own original specifics. Licensing@Russia was extremely useful in this respect.”
For Zeljko William Krnjak, official LIMA Representative in New Europe and one of the event organisers, the success of the show surpassed his expectations: “We have always been confident of a strong turnout and positive feedback but the number of delegates and the enthusiasm they displayed throughout the three days of Licensing@Russia has been phenomenal. The synergy with the other major trade shows obviously helped us but the strength of our exhibitors and programme proved to be a major draw. Everybody I spoke to was very happy with the event – deals were done, partnerships were formed and, above all, licensing representatives from across the world gained a vital insight into the large, lucrative and incredibly promising market that Russia represents.”