MBS Blog

One of the side effects of the Global Economic Crisis-and we have to come up with a new name for this “crisis,” is the steep falloff in the amount of money sent home by immigrants and workers abroad. Many emerging market economies depend on this income to sustain themselves. The fallout from the falloff could be huge…..

Technorati Tags: Global Economic Crisis, State Real Property Cadastre, Bishkek, Chisnau, Kyrgyz Republic, Akylbek Japarov, Armenia, Matthias Luke, Kiel Institute, Kazakhstan, Uzbekistan, construction, Russian government, Anton Olff, external finance, Russia, United States, Western Europe, Dushanbe, World Bank, IMF, Shigeo Katsu, Tajikistan, Moldova, NGO, CIS countries, recession, Clare Nuttall, Almaty, Organization for Economic Co-Operation and Development (OECD), remittance payments, emerging markets,

This article is from one of our favorite bloggers: Mike Hewitt provides the “big picture” of individual nations relative to the global economy.  The picture is not pretty for many.

http://www.financialsense.com/fsu/editorials/dollardaze/2008/1205.html

The extreme level of public debt in developed nations in particular…and these charts don’t measure corporate and private debt…portend an almost certain re-alignment of economic power.  China for example, can be compared to the United States at the beginning of the 20^th century. The United States is now like post World War II Britain. It may never fully recover.

The  result of the changes is the full emergence of transition economies.  Unburdened by massive debt, with growth oriented economies that have incorporated  free market mechanisms,  emerging market economies could  take the lead a lot faster than previously reckoned. Indeed, that may be the “silver lining” in the current economic cloud.

Technorati Tags: China, United States, World War II, Britain, www.dollardaze.org, Mike Hewitt, Wealth of Nations, debt, transition economies, emerging markets, corporate debt, private debt, Anton Olff, Intermational Monetary Fund, IMF, G-7, Japan, Germany, UK, France, Italy, Canada, government liabilities, Foreign Reserves, Sovereign Wealth Funds, United Arab Emirates, Abu Dhabi Investment Authority, Dubai Workd, Singapore, Temasek Holdings, Norway, Government Pension Fund of Norway, Kuwait, Kuwait Investment Authority, China, China Investment Corporation, Australia, Australian Government Future Fund, Qatar, Qatar Investment Authority, Libya, Libya Investment Authority, Alaska Permanent Fund, Brunei, Brunei Investment Agency, South Korea, Korea Investment Corporation, Kazakhstan, Kazakhstan National Fund, Chile, Copper Stabilization Fund, Russia, Russian National Wealth Fund, Malaysia, Khazanah Nasional, Canada, Alberta Heritage Fund, Taiwan, National Stabilization Fund, Bahrain, Bahrain Mumtalakat Holding Company, Iran, Oil Stabilization Fund, Oman, State General Reserve Fund, Saudi Arabia, Saudi Arabia Sovereign Wealth Fund, foreign reserve holdings, India, Brazil, Algeria, Mexico, Switzerland, Turkey, Hong Kong, Poland, Nigeria, Indonesia, Argentina, Romania, Venezuela, Netherlands, Spain, CIA,

The global economic slowdown has not slowed the consumption of fast food. On the contrary, the one thing to count on is the continuation in the growth of inexpensive fast food in emerging markets like Russia and Ukraine.

Fast food-whether it is purchased at a kiosk or market- is generally priced competitively… and is viewed as an affordable luxury, especially during lean times. It is also viewed as the type of consumable that brings a degree of  “comfort,” similar to tobacco, coffee and alcohol.

As the video below  from the Russian News & Information Agency (NOVISTI) at www.en.rian.ru/ the perceived unhealthiness of this type of food is not high on the list of Muscovites……

Technorati Tags: comfort, emerging markets, fast food, global economic slowdown, lean times, luxury, recession, Russia, Ukraine, tobacco, coffee, alcohol, Russian News & Information Agency, NOVISTI, www.en.rian.ru, Anton Olff, unhealthy, Moscow, Muscovite

The unwritten rule regarding the blog here at MBS, Ltd., was that we would focus on macro & micro economic and business issues ONLY. We would not stray into the murky and dangerous waters of politics.

Having stated such, we decided to dive into the political pool (or cesspool?) with this entry. The motivation for this diversion is the topicality and relationship of the subject matter to BUSINESS in emerging markets like Eastern Europe, Russia, Georgia and Ukraine. The subject is NATO.

Nick Witney’s article in the Moscow Times (www.moscowtimes.ru) captures, dissects and congeals the truth like few others have recently.  The fact is, NATO in its current form is an obsolete, expensive and largely political club, where military and security matters are of primary importance mainly to its newest members and aspirants.

The subject of NATO is a divisive issue here in Ukraine, as well as further east.  The inclusion or exclusion of Ukraine and Georgia into the current NATO organization, will affect the economic direction of these nations.

Some argue very coherently, that a byproduct of NATO inclusion is the acceleration of political-or what we could call “philosophic integration” between new members and “the West,” as well as increased trade. The hope among the practitioners of “realpolitik” in the West, is that an expanded NATO will act as a check on Russian, as well as Asian influence and ambitions in Europe.

The main problem with this thesis is that it ignores the weakness of NATO and the shifting alliances that have resulted.

Anton Olff

Technorati Tags: MBS, Ltd., EU, Turkey, Moscow Times, Nick Witney, Winston Churchill, Charles de Gaulle, Barack Obama, Cyprus, Warsaw Pact, Serbia, Slobodan Milosevic, Kosovo, Afghanistan, ethnic cleansing, realpolitik, Asian influence, security, trade, economic integration, Business, Europe, Georgia, Russia, Ukraine, Eastern Europe, NATO,

Someone in Russia understands a thing or two about the benefits of competition. As this article from the Wall Street Journal (www.wsj.com) indicates, the privatization of one of Moscow’s airports, has been positive.

As a frequent traveler to Moscow , the privatized Domodedovo Airport is the preferred choice.  Modern, clean and efficient…with decent food for the international traveler, it is a stark contrast to the international terminal at Sheremetyevo Airport. The dark brown paint at Sheremetyevo may have been whitewashed, but the depressing feeling lingers for travelers and airport workers there.

 While government investment in Sheremetyevo Airport will certainly improve the overall quality, the privatized Domodedovo Airport will have the edge with travelers, vendors and airlines. It is simply more responsive to the needs of the market.

 Privatization of airports is growing. According to Robert W. Poole, Jr. of the Reason Foundation (www. reason.org), “15 major airports were privatized in 2006, the second-highest annual total ever (there were 21 airport privatization deals in 1998).

Despite recent political setbacks, privatizations could continue. Unlike China,  Russia and Ukraine lack sufficient resources to fully modernize their infrastructure.  Privatization or partial privatization remain the most viable options. The investment, technology and management that foreign companies would bring, could go very far in raising the living standard in these emerging economies.  

 Moscow Points the Way With Airport Competition

While Most Nations Sport Monopolies, Rivalry Between Two Russian Gateways Ushers in Improvements for Carriers, Travelers

By DANIEL MICHAELS

MOSCOW — A heated battle for passengers between the Russian capital’s main airports offers an unlikely model of competition for the aviation industry.

In most cities, airports are monopolies. Even in cities that have more than one, including New York, Paris and Tokyo, airports are usually owned by the same operator. That means airlines can rarely make the kind of choices passengers take for granted, such as choosing an airport for its efficiency, shopping or lounges.

Not so in Moscow, where two international airports, Domodedovo and Sheremetyevo, owned by rival organizations, battle for business. The result is lower fees, better service and fast-improving facilities all around.

Domodedovo Airport, for example, recently convinced several top airlines to make it their Russian base, thanks to a major modernization that added more than 20 new restaurants, jewelry boutiques and a shop where passengers can rent DVDs to watch in booths.

Sheremetyevo Airport responded by building a fast rail link to Moscow, complete with a Starbucks at the airport station.

Moscow’s airport rivalry highlights a paradox of the global aviation industry: Airlines compete fiercely with each other for customers, but they face many monopolist suppliers, such as air-traffic control systems, fuel distributors and airports. Resulting costs and poor services get passed on to travelers.

Regulators world-wide are starting to tackle the issue — and some see Moscow as a paradigm.

Britain’s competition authority, for example, last year considered breaking up BAA, the company that runs London’s three big airports. In testimony before the regulator, officials from the International Air Transport Association, a trade group, cited Moscow as evidence of the benefits that competition could bring London’s airport system. IATA testified that fees at Moscow’s fast-growing, privately owned Domodedovo Airport are as much as 20% lower than at Sheremetyevo, the state-owned hub of flag carrier Aeroflot.

The U.K. listened. Bowing to government pressure, BAA’s Spanish ownerFerrovial SA now plans to sell London’s second-biggest airport, Gatwick. British Airways PLC and other big customers are too entrenched at Heathrow to switch to Gatwick, but airlines say competition could prompt airport managers to trim fees and start to resolve problems such as chronic fuel-supply shortages.

“I’d love to have competing airports everywhere in the world,” says Bruno Matheu, executive vice president for marketing at Franco-Dutch carrier Air France-KLM SA, an Aeroflot partner in the SkyTeam airline alliance. Air France-KLM uses Sheremetyevo in Moscow.

Moscow’s airport market didn’t develop overnight.

Until recently, few big airports world-wide were worse than Sheremetyevo, the Soviet Union’s international gateway, built for the 1980 Olympics. Checking in for a flight could take hours. So could driving jammed roads to the airport, which lacked rail connection.

During Russia’s privatization drive of the 1990s, local investors bought Domodedovo, which was previously Moscow’s airport serving Soviet Central Asia. The investors, grouped into an upstart charter-airline operator, East Line Group, renovated a terminal at Domodedovo and oversaw construction of a train line to Moscow.

East Line charged airlines landing and operating fees that undercut Sheremetyevo by around 30%. For passengers, Domodedovo’s rail link guaranteed a 40-minute trip to downtown Moscow. Private Russian carriers, largely frozen out of Aeroflot’s base at Sheremetyevo, expanded quickly at the spacious Domodedovo.

East Line’s big break came in 2003, when British Airways announced it would switch from Sheremetyevo to Domodedovo.

“The authorities were shocked that a major airline would leave the government airport,” recalls Daniel Burkard, BA’s former country manager for Russia. He says a big factor was that East Line offered a big business-class lounge.

Mr. Burkard, a 41-year-old German, says he was so impressed by Domodedovo’s management that when his BA contract in Moscow ended in 2005, he joined East Line as its business development manager and started wooing other airlines to Domodedovo.

He promoted the airport’s many domestic airlines, which allow foreign carriers to reach small cities across the former Soviet Union, and in 2005 catapulted Domodedovo over Sheremetyevo as Moscow’s biggest airport in terms of passenger traffic. Other attractions include a children’s area staffed with nurses, fast immigration lines for Westerners, and competing vending machines, operated by rival suppliers.

In 2006 Mr. Burkard convinced up-market Austrian Airlines AG to switch from Sheremetyevo. The move prompted other carriers in the Star Alliance to rethink their choice in Moscow. Last year Deutsche Lufthansa AG, one of the biggest foreign carriers in Russia, also made the jump.

When AMR Corp.’s American Airlines decided last year to enter the Moscow market, managers visited both international airports. They were impressed by Domodedovo.

The airport’s executives “were a bit more aware of how we do business,” says Craig Kreeger, American’s senior vice president for international operations. Since flights began this June, Mr. Kreeger says, Domodedovo has fulfilled its commitments better than many airports in more developed markets.

Over the past three years, 28 carriers have either shifted to Domodedovo or started new Moscow service there.

Domodedovo’s success brought it unwanted attention, however. During Vladimir Putin’s recent presidency, many of Russia’s 1990s privatizations were reversed.

At East Line, government security officials repeatedly searched facilities and confiscated property. Government lawsuits against East Line yielded court rulings that threatened the company’s control of the airport. The Kremlin’s objective wasn’t clear, but appeared to be related to battles between powerful clans for control over the lucrative airport business, according to people close to the conflict. Recent appeals-court decisions supporting East Line seem to have ended the problem, although political shifts might prompt new challenges.

Two years ago, Sheremetyevo started to fight back, as a new management team began redeveloping the airport. In June, Sheremetyevo got a 30-minute rail link to Moscow. One new terminal recently opened and two more are slated for completion by 2010. In the old terminal, workers are now repainting brown walls white, modernizing check-in desks and installing more shops.

Anton Olff

Technorati Tags: Aeroflot, Air France-KLM, American Airlines, Austrian Airlines, BAA, British Airways, Domodedovo Airport, East Line Group, Ferrovial SA, Gatwick, IATA, Lufthansa, Moscow, Privatization, Reason Foundation, Robert W. Poole Jr., Russia, Sheremetyevo Airport, SkyTeam, Soviet Union, Ukraine, Vladimir Putin, Wall Street Journal

If you want to peer into the future of marketing and advertising, then this article in the U.S. edition of the Wall Street Journal (www.wsj.com) is the vehicle. Although it could be construed that it only reflects a snapshot from an American perspective, the odds are that these modes will be replicated…or perhaps even improved…in emerging markets.

As internet access-particularly broadband-becomes more widespread in Russia, Ukraine for example, then additional avenues for reaching and informing consumers will increase.

Marketing in the World of the Web

Bemes, clouds and MySpace: Welcome to the brave new world of retail.

By TOM HAYES and MICHAEL S. MALONE

Retailers will eventually recover from the consumption tailspin that threatens this holiday season. But quite apart from the recession, there are other, profound changes underway in the retail sector. As the evidence mounts about the power of social networks to reconfigure individual behavior, the crucial question facing industry is: How to leverage this phenomenon into actual profits?

The second generation of Internet (”Web 2.0″) companies such as MySpace, Facebook, Linked/In and YouTube exploded upon the scene three years ago. Today, MySpace and Facebook together have more users than the entire U.S. population; and the online community concept is already becoming a powerful tool for everything from creating customer loyalty, to assistance in product design, to a sounding board for company strategy.

Corporations from IBM to Toyota and Johnson & Johnson have been rushing to establish their own affiliated social networks and bind their customers ever more closely. There isn’t a smart company today that isn’t implementing some kind of online community, wiki or blog strategy.

But companies with millions of members of online communities are now asking: What next? How do we sell them products and services, or mobilize them into massive de facto R&D, manufacturing and sales departments? We have been studying the challenge and have concluded that very few of the traditional techniques of classical marketing (call them Marketing 1.0), or even of eCommerce (Marketing 2.0) will work in the world of social networks. A very different set of tools, concepts and practices is needed. Call it Marketing 3.0. Here are five:

- From loyalty to attention. Before you can win consumer loyalty, you have to capture and reward consumer attention. Old propositions — network television’s tired offer of 22 minutes of canned sitcoms in exchange for eight minutes of untargeted commercials — won’t cut it. Consumers are demanding a better deal.

Some brands are starting to flirt with better exchange rates: Virgin Mobile gives a minute of free phone time for every minute of advertising a customer accepts. Ryan Air recently announced it would offer $15 coach tickets from the U.S. to Europe, subsidized by passenger attention to advertising and in-flight sales pitches.

Smart marketers will of necessity become obsessed with customer attention in the way they once obsessed over customer loyalty. The shrewd brands will create elaborate attention-rewards programs, and incentives to break through the noise and make that critical initial connection.

- From crowds to clouds. Once you get that attention — once you generate heavy traffic to your site, gather a large league of “friends” on MySpace, or spawn a dedicated following on Twitter — how do you monetize the crowd?

Smart brands are turning their crowds into “clouds”: organic, self-forming and often self-governing communities of interest. Companies such as Hewlett-Packard, Frito-Lay and Harley-Davidson use their clouds as feedback loops to get better faster by obtaining good, timely, often brutally honest customer insights. And the members of clouds can become true believers; they don’t just watch your commercials, they make them.

Right now, few companies are emotionally equipped to wring the best benefits of a cloud, because the most valuable voices out there usually belong to the malcontents. In the old model, customer-service departments aimed to placate or jettison disgruntled customers. In the cloud model, the idea is to cultivate and reward them. That’s not an easy transition.

- From places to spaces. Consumers are increasingly organizing themselves into new communities — not just the big generic social communities, but myriad idiosyncratic slices of narrow, passionate interest (i.e., BlackPlanet, Inpowr and MomsCafe).

These new market spaces, or “meganiches,” may seem small, even strange at first. But when they’re efficiently targeted, they can be highly responsive, lucrative and loyal. Well-established meganiche Web sites include Gamefaq.com for video gamers, Dpreview.com for digital photography aficionados, and Howardchui.com dedicated to mobile phone zealots.

With this shift toward self-organization by consumers, national advertising campaigns as we know them will increasingly become a waste of time and money for many companies. The trick for brands is to cohabit social spaces with these consumers. Social media, and its verb form, “friending,” requires entirely new forms of advertising: bottom up instead of top down, personal rather than public, and subtle rather than full frontal.

- From memes to bemes. In the Age of Broadcast, good advertising could occasionally manufacture memes of tremendous social impact. Think of “Where’s the Beef?” or “I can’t believe I ate the whole thing.” If you can’t recall an irresistible or effective turn of phrase of late, it’s because it is exceedingly difficult to spread a meme in today’s fragmented media environment. Marketing 3.0 is now the science of devising and managing directed business memes: call them bemes. Bemes are sent by members of social communities to each other and typically contain a reward or exclusive offer, which, when redeemed, also results in a reward coupon for the sender. This encourages members of social communities to propagate a “viral” ad. One well-documented beme was “The Subservient Chicken” from Burger King.

Brute force marketing won’t work inside social networks. The best online marketing now takes place among people who know and trust each other. Consider how rumors work. Like a rumor, a beme is a bit of useful information that rewards each person who passes it along. Want to be a sensation? Create a beme that consumers willingly accept and share with others.

- From silos to simultaneity. Too many retailers today persist in believing that online shopping is merely a virtual extension of real world shopping. That is a big mistake.

Rather, online and offline need to coexist, and we need to rethink how they relate. For example, to their surprise, companies like BestBuy (which even encourages customers to shop the aisles but buy online from in-store kiosks) and Macy’s are discovering that physical retailing is a perfect way to move units online. That is, the physical world has become the showroom for the virtual realm.

Retailers now must reimagine a world where consumers experience products in stores but ultimately buy them on the Web: Stores are for experiences, the network is for inventories. And what in turn prepares potential customers for what to look for in stores? Online communities.

All of this suggests that Marketing 3.0 is not only different from its predecessors, but actively undermines them. If your marketing program fails to adapt to this new world, it won’t just become irrelevant — it will actually work against you.

Anton Olff

Technorati Tags: marketing, advertising, Wall Street Journal, American perspective, internet, broadband, Russia, Ukraine, MySpace, retail, consumption, social networks, Facebook, Linked/In, Youtube, IBM, Toyota, Johnson & Johnson, R&D, eCommerce, Virgin Mobile, Ryan Aur, Europe, customer loyalty, rewards programs, Hewlett-Packard, Frito-Lay, Harley-Davidson, commercials, social communities, BlackPlanet, Inpowr, MomsCafe, Gamefaq.com, Dpreview.com, Howardchui.com, friending, Burger King, BestBuy, Macys,

Spoke with a good friend a few days ago whom is a customs broker here in Odessa.  She stated that business overall has declined precipitously over the last several months. She emphasized that container traffic at the busiest port of Ukraine has slowed to a trickle. This is borne out by anecdotes of others we have contacted whom are connected with trade and logistics services. 

Technorati Tags: Odessa, Ukraine, container, www.komersant.com, Russia, trade, logisitics, imports, wine, Customs Warehouses, financial turmoil, alcohol, Moscow, Federal Customs Service, Solntsevo, CIS,

Economics has often been called the “dismal science.”  Having known many economists in my past life working as a wage slave in the corporate world, I can say that it was not the “science” that was necessarily dismal, but the practitioners. This is especially true these days. The same economists that were saying “the fundamentals” of the Global Economy were sound 6 months ago, are now in the doom and gloom mode. In  other words, it is not going to just rain…but rain for 40 days and 40 nights!! 

A person of means and resources might want to start building an ark…or maybe just buy gold bullion and store it in a bank vault in Switzerland…but the rest of us will have to learn to swim in some very deep water (or in sewage) if the deluge comes.

The Nostradamuses of our age…Gerald Celente for example, is predicting Depression II, another American Revolution with widespread tax riots in the United States by 2012. Certainly, it is a possibilty given the recent riots in Iceland. However, those of us with a eye for opportunities (entrepreneurs, shameless exploiters and capitalists) know that would be an excellent time to own a factory making Ronald Reagan AND Che Guevara t-shirts. 

….and what is the current forecast? Well…it depends on whom you ask. Most of the data out there suggests that the economies of the developed world will not be growing at all…but NOT the emerging market economies. According to the European Bank of Reconstruction and Development (EBRD), Russia is projected to grow at over 3% versus the 7.3% it had been prior to the Global Meltdown (and declining oil prices).  Indeed, most of Eastern and Central Europe will see positive net growth. Whatever the forecast, there will be a lot of pain…but also a lot of long term opportunities.

Bring an umbrella. However, make sure to turn it upside down on occasion as it could be raining “pennies from heaven”

Anton Olff

Technorati Tags: Central Europe, Che Guevara, Depression, Eastern Europe, EBRD, Economics, European Bank of Reconstruction and Development, forecast, Gerald Celente, Global Economy, gold, Iceland, Ronald Reagan, Russia, Switzerland, United States

An in-depth and insightful look at the mortgage market in emerging economies of Central and Eastern Europe (including Russia & Ukraine),  as well as Central Asia by the European Bank for Reconstruction and Development (EBRD).  

In pdf format..a must read for anyone currently investing in real estate or securities in these markets or considering future investment. 

http://ebrd.com/pubs/legal/mit.htm

NOTE: The MBS referred to in this report are Mortgage Backed Securities and not MBS, Ltd. 

Anton Olff

As I wrote on 24 November 2008, the recession in emerging markets provides opportunities for companies to promote, establish, re-establish, and capture market share. The key is looking beyond the short term-which is painful for almost everyone at this moment- and focus on the long haul.

John Rose writes today in “The Moscow Times:” The looming crisis in Russia will cause many marketers to re-evaluate budgets, strategies and relationships. Although there may be many challenges ahead for companies as they face the prospect of slower growth and pressure on margins, there is a silver lining in that black cloud. During the last financial crisis in Russia, a decade ago, some companies took advantage of falling media costs and slow-to-react competition to capture market share and set the stage for strong future earnings.

There are three main opportunities for marketing during a recession.

Opportunity No. 1: Customers generally re-evaluate their brand loyalties during a recession. It is no longer business as usual. Many people will be looking for greater value as their buying power weakens. A recession breaks down barriers that make consumers otherwise resistant to new brand messages. This creates an opportunity for brands that have otherwise been unable to capture significant market share in a crowded category or one dominated by a larger competitor. If you are the No. 2, 3 or 4 brand in your market category and you have a good story to tell, this could be your best opportunity in years to relate your story and receive a positive reception. Reacting to the last financial crisis, Mobile TeleSystems continued advertising, while its competitor Beeline retreated. As a result, MTS substantially raised its subscriber base and overtook, Beeline, to become the top Russian mobile service provider. And MTS still retains the No. 1 spot today, despite Beeline’s ubiquitous advertising campaign.

Opportunity No. 2: Many companies will take a wait-and-see attitude during a recession. They will freeze or cut marketing budgets until they have a clearer picture of what lies ahead. This will have the effect of reducing media costs. The smart companies will become more aggressive while their competitors have their heads in the sand, and they can get more for their marketing expenditures. Now is the time to be creative and grab some attention for your company and brand. Establish yourself as a leader by staying visible through the media, promotion and public relations. Show the world you have a resilient brand and a plan for a sustainable future. Experience shows that market share gained during a recession will return dividends when the economy rebounds. Wimm-Bill-Dann continued to promote and expand aggressively during the last crisis, filling a vacuum left by international competitors, who were still licking their wounds. Today, they are the leading Russian producer of dairy and beverage products. Saint Springs is another example of a company that continued to expand its marketing programs while the market was still contracting. After becoming the leader in the bottled water segment, it was acquired by Nestle Waters in 2002.

Opportunity No. 3: Customers expect a deal during a recession. People know companies are under pressure and will expect them to react to the recession with superior products, special offers and better service to win their business or get them to buy. You don’t want to disappoint them. But unless you run a volume business where you plan to always be the price leader, you shouldn’t feel obliged to lower your prices to win business during a recession. Sure, discounts will move inventory today, but it may come at a high cost in the future through the loss of brand value. The key is to give your customers more rather than charge them less. Value is most important, not price. Expand product features, extend warranties, provide special financing terms and offer enticing rewards for becoming loyal to your superior brand. Electronics retailer M-Video owes much of its success to creative promotions it began during the last crisis to lure customers and build loyalty, which is a practice they continue to this day. Currently, together with Sony Ericsson, they are giving away a card that provides free cinema tickets for one year when you buy select mobile phones. Their customers will be escaping the Russian recession to Hollywood — at least in their imaginations — and will no doubt reward the company with loyalty and future purchases.

It’s easier, of course, to follow the market and do what the other guys are doing during a crisis — that is, very little. But with a better understanding of the short window of opportunity brought on by a crisis — plus a little chutzpah — your company could use this recession to build a stronger brand and a more profitable business in the near future, when Russia bounces back.

Anton Olff

Technorati Tags: recessionary marketing, emerging markets, market share, brand, Moscow Times, marketing budgets, Russia,