Magazine article Management Review

Madison Avenue Lands in Moscow

Magazine article Management Review

Madison Avenue Lands in Moscow

Article excerpt

Madison Avenue Lands in Moscow

Mike Adams, a managing director of the public relations and advertising firm Young & Rubicam/Sovero, has the office of his dreams. "We've got everything," he says, listing the state-of-the-art equipment at his fingertips. "Fax and telex machines, satellite linkup, desktop publishing capabilities - it's probably the most modern, Westernized office in the country." Still, the most remarkable aspect of this workplace is not its high-tech contents, but its location. Adams is stationed in Moscow under a partnership between his New York-based company and the Soviet government.

Young & Rubicam is not the only advertising/public relations agency with a branch in the Soviet capital; rival organization Ogilvy & Mather Worldwide is part of a three-way venture with the USSR and Hungary. "Lenin said that advertising people were the `leeches of capitalism,'" says Gary Burandt, head of Young & Rubicam's Moscow concern. "When we opened our offices in Moscow, we thought of making a leech our logo."

Today no one is worrying about what V.I. Lenin would have thought of market surveys and focus groups. With millions of people eager to exercise their choices in everything from politics to paper towels, Mikhail Gorbachev's Soviet Union constitutes an appealing frontier for Western businesses. From the Soviet perspective, interest is especially keen in scarce consumer goods - food, toiletries, household supplies - coveted by an underserved public. Now, American advertising and PR executives are working to bridge the gap between Soviet customers and American suppliers.



"We are three to five years ahead of the marketplace," Young & Rubicam's Burandt pointed out at last fall's USA '89 trade fair. Lack of availability and lack of competing brands means that advertising is not yet necessary in the USSR. Instead, Young & Rubicam is offering a range of other services to its clients, including public relations, consumer testing, management consulting and simple handholding to help U.S. companies understand the Soviet market.

"We are working to be the leaders in Soviet insight," Burandt says. "We want to know more about doing business in the Soviet Union, more about the customer and more about media opportunities than anyone else." And, since Young & Rubicam is dealing primarily with Western clients, who pay in hard currency, the issue of ruble convertibility does not affect its business.

For all the differences, the substance of the work hasn't changed too much since Madison Avenue landed in Moscow. Adams' primary responsibility is to collect market information, a task that is complicated by the unavailability of Soviet data bases. But material that is privileged in the states may be accessible over there. For example, in an attempt to locate likely customers for Johnson & Johnson - Young & Rubicam's biggest client in the Soviet Union - Adams' employees studied polyclinic registry cards and called patients directly. Survey results were skewed, since the subjects weren't as healthy as the average Soviet citizen. The next foray proved more fruitful: Staff members intercepted women as they left drugstores and contacted them afterward, one-on-one. Participants received product samples as payment for their time.

To ensure that minorities were represented, surveys were conducted in Moscow, Kiev, Vilnius, Tbilisi and Kursk (a small city 120 miles south of Moscow).

"There are about 120 nationalities in the Soviet Union, and right now people are feeling their way around the ethnic question," Adams notes. "We identified consumers who were comfortable using Russian versus those who preferred to use another language. Where needed, we hired free-lancers who spoke that language. Right now, it's not clear that Russian is universally acceptable. To launch products, which we hope to do within a year, we may need packaging printed in Armenian, Georgian and Moldavian scripts. …

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