Marketing

Russian Standard Vodka: Strategies for Global Branding and Expansion into the US Market

An Individual Case Study Prepared by Yanan MIAO under the Supervision of Pro. Hans MUHLBACHER for International Marketing Course T1-2011-2012

Background

Russian Standard vodka, known as Russia’s number one premium vodka brand, was founded by Roustam Tariko and initially launched in 1998. Four years later the sales of this authentic Russian premium vodka surpassed all imported premium vodkas, achieving the number one position in the premium segment with a 27% market share in its domestic market.

Brand Identity

The first truly premium Russian vodka that “Embraced the past…and inspired progress”.

Company’s Objective

Equals to the founder (Tariko)’s vision: to make Russian Standard vodka the number one Russian vodka in the world.

Assessment of the Current Market

Success factors: 1. An evocative brand name. 2. Unmatched product quality. 3. Production Origin. 4. Distinctive premium packaging. 5. Strong distribution networks, commanding merchandising skills. 6. Premium pricing policy. 7. Smart promotional on-premise and off-premise strategy. 8. Strong financial support from brother company—Russian Standard Bank.

Failure: Inaccurate domestic advertising compaign—conceived by its consumers as inconsistent with brand image.

Issue

Encouraged by its rapid success at home as well as driven by the vision of its founder, Tariko wondered whether Russian Standard vodka should be launched in the US market, the biggest premium vodka market in the world in 2000.

Business Strategy in European Markets

Did no or minimal adaptation to the product or marketing mix. And this European expansion was relying on personal connections with small local distributors with no support by advertising or significant promotion.

Analysis of the Intended Market

● Market Potential: In 2000, the US was the No.1 premium vodka market, with around 8 million cases in annual sales of premium vodkas....