Russian Advertising Market Expected to Grow by at Least 15% in 2002

According to preliminary estimates, the volume of the Russian advertising market will grow by 15-30% in 2002, reaching $2bn-$2.3bn. Vladimir Kismereshkin, chairman of the Advertising Committee of the Russian Chamber of Commerce and Industry, announced this information at today's news conference devoted to the Brand of the Year/Effie - 2002 contest. Answering an RBC question, he added that the Chamber of Commerce and Industry reckoned that the Russian advertising market volume could reach $3-$3.5bn in 2003. As it was reported earlier, the corresponding figure for 2001 was $1.75bn.

Kismereshkin remarked that expenditures on brand promotion made up a substantial percentage of all advertising expenditures in Russia mow, but there was still no methodology for making a precise assessment of the value of Russian brands. However, according to him, this parameter partly determined the value of a company now, whereas only five years ago participants of the Russian market did not even take it into account. In Kismereshkin's opinion, the next 10 years are likely to be a period of massive 'brand construction.' He remarked that for example, in the US material assets made up just 4-5% of the value of a company, and the rest of the value was due to so-called non-material assets, including the value of a company's brands.

Kismereshkin pointed out that a Russian origin of brands and trademarks had already become important for the value of a company in 2002. It is also important for international corporations operating on the Russian market. He referred to the situation in China, where of the 20 most fashionable brands, 19 are of Chinese origin, and Coca-Cola is only in 20th place. According to Kismereshkin, the approximate value of the main Russian brands has already reached tens of millions of dollars.