Russia's Booming Drinks Market
Of all the BRICs (Brazil, Russia, India and China), Russia has seen the most dramatic long-term changes in alcohol consumption (See figure 1). After dipping in the 1980s, Russian alcohol consumption rose sharply during the following decade as the country experienced a period of political and economic instability. The per capita volume of litres of pure alcohol consumed by Russians more than doubled from 3.8 litres in 1990 to 8.7 litres in 2003, according to WARC's World Drink Trends report.
Figure 1: Russian drink trends compared to other BRIC markets
(Source: World Drink Trends 2005 WARC in association with Commissie Gedistilleer)
In recent years, as Russia has enjoyed greater prosperity, the drinks industry has continued to expand, with newer market segments growing fastest. Given the size of Russia's 140m-strong population, this underlying dynamism explains the attractiveness of its alcoholic drinks sector to Western and local brands alike.
Recent mergers and acquisition activity, including the battle for control of BBH, the Russian and Eastern European brewing operation created as a joint venture between Scottish & Newcastle and Carlsberg, has emphasized this point.
Although vodka still dominates the Russian market, with a huge volume lead over other drinks choices, tastes are in flux. In 2007, for instance, total Russian alcohol consumption is estimated to have been about 500m 9-litre cases or their equivalent. Within this, vodka accounted for about 280m of the 296m 9-litre cases of spirits drunk in the country. Beer consumption is estimated at 105m equivalents of 9-litre cases and wine at 103m.