News analysis – opportunities in Russia

Prime Minister David Cameron yesterday went a on-day flying visit to Russia with the aim of forging closer ties, both politically and on a business level.

The UK design industry has long had a presence in Russia, and while the economic downturn did put the squeeze on design opportunites in the country, Cameron’s visit – combined with upcoming events such as the 2014 Sochi Winter Olympics – suggest that opportunities there are growing.

Much of the press focus surrounding Cameron’s visit was on the first face-to-face meeting between a British Prime Minister and Russian counterpart Vladimir Putin and a possible diplomatic rapproachment between the two countries following the death of former KGB officer Alexander Litvinenko in London in 2006.

But alongside these complex political wranglings, Cameron also had time to generate an estimated £215 million in new business deals, including a move by DIY chain Kingfisher to open nine new Castorama stores in the country.

Cameron put his finger on the appeal that Russia has for British designers when he said, ‘Russia is resource rich and services light. Britain is the opposite… We are uniquely placed to help each other grow.’

One reason that Russia has been such an appealing market for UK design consultancies is the boom in new companies setting up with the growth in the Russian economy.

A classic case study from a design point of view is telecoms company Yota, which set up in 2007 and enlisted 300 Million to create its identity, as well as appointing All of Us as lead interactive consultancy, Fray as lead creative consultancy, and Someone to work on branding for Yota Play.

A UK Trade and Industry report published earlier this year identified key Russian growth sectors as research and development, IT, finance and healthcare. UKTI said, ‘The economic downturn was a reminder that Russia couldn’t simply rely on oil and gas for its economic growth but needed to diversify into other markets and open new revnenue streams.’

UKTI also identified a number of the sort of quadrennial events beloved of WPP chief executive Martin Sorrell, which are set to focus business and marketing attention on Russia in the coming years. These include the 2014 Sochi Olympics, the 2018 World Cup and plans to bring the Formula One Grand Prix to Russia in 2014.

And although Cameron’s diplomatic wranglings suggest that issues traditionally faced by UK designers in Russia – the language barrier, currency exchange and cultural and business differences – still exist, indications are that a lack of Russian money is unlikely to be a problem in the near future.

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