Home Shopping in Russia

By Irina Odinokova

DRTV and home shopping in Russia was a concept conceived 12 years ago by Larisa Mikhailova, the founder of TV Club. In 1994, Mikhailova hosted the first home shopping TV show and in the first week on-air, sold the entire container of products. A number of major western players entered the industry four years later. However, these companies fell on hard times in 1998, which was a time of financial crisis. All of those same companies, except for TV Club, left the marketplace in 1999. A few new DRTV companies emerged after 2000, including Top Shop, Teleshop and Sozvezdije Krasoty.

THE RUSSIAN MARKETPLACE
In terms of the media landscape in Russia, airtime can be purchased from a few licensed broadcasters. However, there are legal restrictions imposed on the limited blocks of airtime dedicated to advertising. This has resulted in relatively modest growth development of the DRTV and home shopping business in Russia. In the meantime, the country is experiencing a consumption boom, with all sectors of the economy growing at double-digit rates. Household incomes have on average increased by over 12 percent since 2000. Common shortage of retail channels, especially outside of urban areas, presents an opportunity for distribution. There were 22 million Internet users in Russia in 2005.

Until just recently, Russia lacked a dedicated television platform for direct sales of consumer goods suitable to home shopping customers. The situation changed on May 1, 2005, when TV Club launched the first Russian television retailing network originally based on the 60th frequency range in Moscow. Now the company broadcasts 24 hours of commercials at its own channel seven days per week and nearly three hours per day, featuring short-form spots on national networks.

Similar to the U.S. and other global markets, home shopping orders in Russia are delivered next day in Moscow and the Moscow region via a fulfillment service or via regular postal service in remote districts all over the country, while customer payment is normally made upon delivery. Imported products are very popular in the country, especially the following categories: fitness equipment, health and beauty care, housewares, and DIY appliances.

It usually takes time to understand features of the Russian market and to secure the right partner for your campaigns. A supplier should understand market differences and requirements, such as compulsory testing, customs and approval regulations, among others. It is important to search for a long-term relationship with an experienced multichannel marketing company that specializes in home shopping and DRTV (long and short form), print, direct mail, catalogs, Internet, e-mail and outbound services.

Teaming with a company that has several years of experience in the market can result in a very profitable partnership.

Irina Odinokova is an international manager for TV Club in Moscow, Russia. She can be reached via e-mail at odinokova@tv-club.ru.