hello tsotsi from moscow is kevin owen here with me with the headline of cost eight pm this sunday evening he says of a cutting as catastrophic tax and ballooning budget as other countries ones eager to join the bloc have second for some. but how to stop the global crises happening again major business and political leaders and discuss just that the international economic forum it's wrapped up in some ideas but we're heading just a minute as well in fact. on syria faces a third round of e.u.

sanctions amid more deadly and see government crackdowns which saw more than a dozen dead and thousands rage nationwide. so that as promised up next we head back to some people of. the form about boosting the investment mood here in russia . hello and welcome to on the money with the business of russia it is business as usual about today we're broadcasting from the st petersburg international economic forum and we're talking about branding. to discuss branding i'm joined by robert sas and he is senior managing director at u.s.g. private equity also we have you know cocoa teachy is chairman of the board of the retail chain picnic and robert me he's managing partner at robert may consulting group ok gentlemen we're in st petersburg and i'd like to ask you robert the first

question we think of the term branding the country japan technology china the factory of the world germany precision united states may be too much financial market you think of russia what brand comes to mind. if today's one one does come to me what i can say about that i've lived here in russia for a long time and i've watched a lot of changes and improvements happen over the best ten to fifteen years i had to describe russia in short i would say it continues to be a country in transition with considerable long term potential you've got a brand that's her brand in my opinion it is because i'm not sure how well she could describe it because we went from one system and we went from one brick and another brand into we're in transition to create their own model here in russia i would say it's not going to match the model you'll see in other countries but what i can say that it has some suitable long term potential not short term but long

term i think the division is there the policy vision is there on behalf of the president's administration in the government it's just the biggest step is taking this syrian policy and putting it into practice and i mean changing the institutions changing the the infrastructure changing the mentality of a lot of the people that meet me going there a long time robert. i'm going to you private equity when you look at investors what kind of branding they see in russia what do you see is a plus a deficit or a void but sadly what we've seen recently is a lot of successes in the in the ip space and technology i mean take a brand which maybe hopefully associated with russia but i think is you know has very strong russian roots which is google. a great company dubai world why real program exactly more recently there's been an i.p.o. yandex which will be a great success. and we're right here but we're actually an investor like in india and that's ourselves but there are a lot of very very bright russians

a lot of people who have very good computer skills software development skills and i think about is becoming a brand russia you know you you actually run the chain electronics. softwoods chain how hard is it in russia today two thousand and eleven to create a lasting viable valuable brand. i think. you can create the brand in a day you know because the solution change so quickly even in our segment the fully tronics ask the almost léontine you will of them all exist in chains no we just. make changes in industry because of the impulse of the internet because of the changes a customer gave us was of people and people will want to fly and something tells them they want to buy and for those people then years ago. looking at old rushes is really unique solution especially in the new deal if you go where was just some

european company. one was a company ms existence will lead to strong national brands in the scene local brands google groats in full signal for national repeal all. national brands because you see or in some luminaries live bullets you know. the making of your true hero you're striving to be the biggest in the best in your field have you learned certain branding meek's from western media western competitors or western peers i mean how do you when you look at your consumer how do you match brand and your consumer you look at certain specific local issues that you can play upon or do you look outside and say hey well you know in britain they did this or in argentina they did that i mean is it a combination how do you do it prince it's always it's always trust it means a. really customer still a little boy edition will be no. was it just in your words was a trust in your so is. it safe always his own there's

a chance. to complete it it is easier comes than to go be with you for the stop let's say electronics. you know where to go where. you can where. or electronics people really need you to put a premium because it because there's a lot of international competition supposed to be difficult to understand the quality of the i don't know if you buy some. some stuff like a giver where you can. judge the quality and people look. at him and he sees in ways that are almost more strong brands in produce or a simple thing you may never go back you over here i mean before the program we were both discussing i mean if we look at an international audience international customers i can only think of one international russian brand and i'm sorry it's twenty years out of the end of the soviet union and that's kalashnikov ok i can

think maybe gentlemen can help me out here but i can't think of another brand here that it's a real deficit here but this is also an opportunity i think it's a considerable average going to go. michael ware saying there probably are some very good brands that are known here in russia and i know there are some russian consumers that would really love to buy the russian brand instead of the foreign brands so they. just waiting for someone to please do something with them or improve them. russia has considerable potential because they can take requests practices from around the world they can apply them hearing three brands and really export them out again they have really. it's on limit of what they can do and it's right open and i'm sure in the world i mean sure there are some vodka and some other brands that are being exported now but there's a whole broad range and it's really going to get whatever it also is a i won't name the brand but i like oh mom who teaches wristwatches ok and i came across a russian brand name in here and it's absolutely exquisite maybe a little goldie a little bit too much this is what i do you say ok well this isn't really fair i

should have worn my russian one but my point is that technologically speaking it's state of the art if you can go up against any swiss brand but it's a third the price you can afford the price you know what it was what does that manufacturer how to do i should point out their presentation that with a box with a sold it was awful ok wasn't attractive ok but the product itself was how do they get around that is it just investing that enormous amount of money or just to repeat what everyone else is about but i think it's a process that i mean it's going to take time in any case it's going to be you know twenty odd years old or something you wear and what russian quality was was not something that was was really considered to be good i mean probably to consumer of you can see a great races and watches but things are changing i mean we're seeing we're seeing russian russian brands which are now being the big push towards in the west and and the association of russia with even western brands is very close and take chelsea

football club i mean russia has done a lot for i mean some individual studies done a lot for the russian folk british football and that's fantastic so you know there are certain things where you can definitely see there's been a lot of progress and in pushing a russian association we often do you mean do russian brain. hands have to be better than the best to be equal i just gave the example of a wristwatch manufacturer i mean what do you have to do to get the eye of a consumer because they're selfish so many brands out there that people identify with i mean i'm holding a pen here again i won't name it here but i mean this is one of the nicer ones for most of them are just pure plastic but they still cost a lot of money ok you buying the brand how hard it is is it for you in russian companies you really need that child. through the berlin city of challenge especially if you are just bits of being goes away. easily union coup in the us

money into the us those are people the feel of them is money and. so on you almost leaves a buffer zone for in some areas which if you want and to bret's you know it means that people seem to see anything brants people. needed or you could be female and you pretty much was a sensible us people laws as a parent it's it's like it was before in or one little bit in or out of one. of the people who knows it since those of the old it's a business they still have a hammer and sickle i'd like to point out it's their logo which again you know their place to a local consumer here because i do is a brand that is considered of value though it may be ambiguous to a foreign. consumer and i can tell you it is so i think it's an interesting story that they kept that that mark the hammer and sickle and they they kept it in after the soviet union because it's so well known among russian citizens you know but i think that's an example of

a brand that really changed and you know we're very sad because before when you thought of your of life you know it's not a bit of love one could be for iraq's borders or something like that and now you. remove the international flights on our flight are very very rare their service is very good very international standard and they have a lot of direct flights in places. no it wherever you are there are all brands that we can actually be made international i think the first company that ever listed local on a local stock exchange was also big biscuits yeah well for ok i mean well known in russia but that's a hard it's a hard sell our side of course is you have received several i.p.o.'s of companies which have you know associations very close associations with russian names on and . it is a you know offshoot is a very hard sell but i think when people actually get into these companies and the quality of management look at the fundamentals driving most companies forwards and the market they have in russia and they'll continue to expand outside of russia as

. we've seen quite a few successes you know it's really interesting across our culture to be at the confectionary again if you translated it into english red october it still does not have an appeal to outside this group the borders of this country which i can attach the of their product is excellent ok it is competitive but you know i mean they are there you go can you think of any brands outside of kalashnikov which is a real negative one must really be any other brand that can be sold outside of russia's borders using its name to help you we need we need out there a file that's probably a bit then also. probably of what's. you see in a t.v. in the software maybe if he's successful if you're in love it will store i think girl most of the sample full program strategic. problem but i won't company looking to keep some people's work the secret of lily right on

my money or to jump in here we're going to go to a short break and after that short break or return discuss russia's branding state guard to. be. hungry for the full story we've got just had the biggest issues get a human voice face to face with the news makers on the party. to a substantial degree and one problem or another socialism has spread the shadow of human regimentation over most of the nations that we are. and the shadow is on protein up on all of. the early twenty first century military bases a network of military bases all around the former sleep empire that the united states is trying something that's astonishing most americans have no idea there are

more than a quarter of a million or more than two hundred fifty thousand u.s. troops stationed on these bases all around the world. we don't have power bases on american we don't have any british base we don't have any korean base we don't have any french bases or you know we just all american bases in in our bases afai are the noises i would north as it doesn't bother us at all because they're all bases but for other people it's almost like a cancer here for these people since the end of world war two the spaces i've been . working here to provide a safe and secure environment for everybody. the questions they have thing else you get everything you needed wealthy british style . that's not on.

the. market finance scandal. find out what's really happening to the global economy with mike's concert for a no holds barred look at the global financial headlines tune in to kaiser report. welcome back to on the money i'm peter lavelle and this episode we're discussing branding. ok robert i want to go to you we've heard a lot of good things about running in the first part of the program but i always like to pour a little bit of cold water on things is really branding all that important when so many people in this country because there's a huge difference here is branding so important only just for a small small percentage of the population is it just for aspirational people and i

think many russians are really quite pleased with russian products that i mean depends what we're talking about and the aspirations i mean they want something of good quality that's affordable and there's a lot of historical and traditional aspects to some of the brands that have been around for a long time you like to reminisce about remember the old days this wine this cookie whatever so i think. you know some of the people are never going to reach a point where they can expire to the most expensive brands but for them it's not for the you know as robert is writing it's very interesting as a hedge goom in moscow they have this store guster and all and ten years ago even five years ago i would say they know what no one of whom would never a guarantee to point out to our viewers as a huge huge department store dared to put a soviet almost replica and now you go there it's a very very popular rubber for the same reasons that you mention brands that you crew up with and it reminds me something very much when i lived in poland before i

came to russia was there was a me polska we movement among stuff producers to say look you've had all of the wonderful western goods the cereals the soaps the depends what and the clothes but we had some good stuff here if you see that trend they're really picking up some steam here because costs a drink that almost disappeared here in the kind of an equivalent of coca-cola or some kind of coal in the west came back i guess i was history and i don't know what i'm seeing is more sophisticated russian buyers are actually are actually beginning to understand the value of some of the older better russian brands sixty see this is in food products and drinks. types of be aired in court for definite that but the question is whether these bans can never be marketed outside of russia if it's that's not only not only the home market you know you know if i go to you i mean this could be a tough one in your russian soul and ask you a tough question here i mean russia's reputation is problematic in many parts of

the world because of the soviet past in some cases even before that i mean how does russia in russian companies get over that i mean its history i mean this is a market economy people are very very savvy here are they certainly have the abilities and knowledge in now even money here really is is that kind of all the brand of russia is i couldn't be is that still a major barrier for companies that want to go beyond the borders to sell to consumers because it is a globalized economy and to be a global winner you have to go below book. you can create brands only if you'll waste all the strong. side each wolf legion of. jericho's if you look at the world russia is good if you play the you do you know everybody in all our russian colleagues in the asian it all. was supposed program. if you see on a national brands of exist. some brands in. it

people close to that. so it's a high quality even the broad even the muslim companies are going to bowl. like i did you also are. stupid and it's a stupid law and but you always need to be at least four of those don't you michel felicia if you're just going to give me two but ok maybe again you know i'm going to pour a little bit of cold water on this here i'm ugly name the companies because i don't want to promote them and i don't want them to get angry with me at the same time in this room energy companies in russia there when there is a dispute with a neighboring country. i don't see that they put a whole lot of effort into p.r. and creating a brand you know want to forward paid a responsible corporate citizen i mean it's when you get too big and too powerful they said is there a risk of being lazy and saying it doesn't matter because we're here and people have to deal with this me is that you think that that is the case and just how

dangerous is it because it is dangerous i think so you're speaking more on russia is russia the brown disappears out consumer products because i consumer products i think it will take extreme a long time to have something very competitive in the world and mention the large energy companies they are directly associated with the russian state in some yes they're owned by the russians but in that respect. it's true and it's very important because in russia it's a little bit different where you see the fine line between business and politics it's much finer in russia than it is in many other countries and you still have a lot of these companies that are speed owned or there's a high level of state participation so again on this transition i was talking about once we get to the point where there's more privatization when there's more institutions that are set up that are prepared to rule of law and the conditions that are good for foreign investors then i think you'll start to see bit of a change in the mentality and basically how russia presents itself overseas.

or the way you think about how do you think you know i mean i small and medium companies have to go out of their way to make a good impression but let's go beyond what my my since i just sit on the board of one of the large state shipping companies in russia did not effectively and the director and i was brought on along with several other. independent directors to try and help help me with dealing with corporate governance issues and dealing with always the image of the company in other markets and we're trying very hard to to improve that is an issue of what's the biggest area what's the biggest challenge you face from doing well i think. the biggest challenges is helping my mentality that leads to change but again it's a question of time i see a generational thing i think it will take us through that i mean i could get you know i think it's going to be a couple of years but generally i think of you know ten fifteen years you see a lot of a lot of progress that's going to give you know it will always go back to this you know and i in western media russian companies often get

a bad rap certainly the russian state. how can the russian business in your opinion being a businessman yourself help improve the image of russia as a brand on the international stage because you know when a lot of critics said the west will look at makes you look at oil companies you know it's these evil institutions and things i got as we've already pointed out on this program here there's not that much of people make that kind of differentiation what does business have to do to disassociate itself with government institutions and politicians you. usually when people see a good ball as a company on company made sure it's a brand these trades these people the experience if you're gone you know nobody in france look at it was the french people or. you have. experience on some of you and something broken from this species or if you buy

a little bit we just say. i don't like japan this technique or. you'll. like it. charles for the coolidge yours is i don't suppose a missional jerk but. i think the only way how russia can it is greed is strong it's possible to be more but. really to build on it's not that there was a goal it's a matter of business as well as weekly that is strong business oriented war purists or people who come in the shah who has been here. these weeks spent money will be quotable down people just they will change position a little bells jingle bells will do not only customer bills maybe it will be in more detail than maybe. i think. it will be. now with the need to feel like to see collecting what the national football team if you were to see

a good college program beyond kalashnikov here let's talk about this forum that we're out here how valuable is this forum in st petersburg because it's really a man a lot of people come here into line for a lot of what i read in western media about media about what's interesting is in russia i mean there's just a billion there are so many civilians in this complex here it's hard to keep track of who's here and you can't meet everyone obviously i mean. our form of hype is worse while then why do you guys and. i think you judge me on this program. and. this storm in particular has improved dramatically i would say six seven years ago with a completely different form and i think once the government of the president says look this is going to be our form and they showed a real commitment it's a great opportunity for networking it's it's it's quite impressive incredible you won't find a better forum i think than this to meet anyone who's either senior in government or senior in business so for with respect to the dialogue the ability to meet

people face to face exchange ideas i think is really to wake up and we are transparent and it's really a window for open access i mean you don't have. pretty much you lock in value in the whether it's the president the minister the head of never self aware of my idea being that the access is really quite impressive anything over about i mean i begin to spend a few of them but this is seems to be one the labor day of this i mean i could live beside them here i mean here it is right now i'd anyway but i i pounded it a lot better here and certainly be the organizers of trying very hard to make the new national poll not only posting. russia but only smash received a very very bad idea and to try to write high quality people from business obviously it will come at this and see what the president's going to say. and i thought the report as well but would you say this was more business driven than politics then paul and i didn't have a definite death probably explains the attraction we hope why did you come to this

why you can't do this for. want to do this for me to say because we'll. show you can surely you should it and he'll say complaints. always i don't like to spend too much mail puzzles for him because he. uses them you know like. useless really useless you just spend and so you'd look at the time to see if everybody this will last us is sitting here. with everybody. you have a chance to meet louise days so we see what was difficult to me through you can you can you will we can beat him in one the rooms in the city these you can see people will move them swim up we'll put you. you can also hear something really interesting use. those guns. or will you be the last word here what would you like to see change in russia over the next five years when it comes to brand. bringing

up for the country. i'd like to see a really driven by business where it's less skirvin by politics less driven by government but actually business setting of course setting the pace and then you'll get a feel for that this country really has made the transition and it operates functions like any other you know driving much different than any other place in the world and for it to move on out of time i want to thank all my guests here in the studio i want to thank our viewers for watching us here on the money see you next time and state charges.

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