Fiona Harkin tracks the rise of Moscow’s new money

Russian money is new money. It’s about 15 years old, that’s all. Whereas English money – that goes back over 400 years,” says Elena Ragozhina, the straight-speaking editor of a London- based Russian language magazine called New Style (often known as Ladies Info). In spite of its somewhat awkward layout and the oddly phrased front-page tagline reading, “European magazine published in the UK”, New Style has been pulling in some impressive advertising since it launched two years ago. De Beers, Daniel Swarovski, Loewe and Marni are just a few of the luxury brands featuring in the monthly magazine – the kind of names usually gracing the pages of a slick Conde Nast glossy. I t ’s al l down to this “new money” readership, explains Ragozhina from her Strand-based offices.

Former owner of a Russian language newspaper and wife of a banker, Ragozhina is matter-of-fact about the super-wealth of the “top-end Russian-speaking demographic in the UK, numbering over 300,000 and with the kind of combined purchasing power symbolised by Roman Abramovich’s spending spree at Chelsea football club. “The immigrant community here in the UK, and also from the former Soviet Union states, is not a typical immigrant group. It’s all about business. These are well-educated, well-travelled, wealthy people,” she says. Wealthy as they may be and with an almost cliched passion for brands, this type of Russian consumer is no longer in need of just a guiding hand when it comes to luxury goods, but an added enticement to shop. In short, this small but significant consumer group needs special attention – some high-end schmoozing if you like. And this is where the ladies at New Style are carving out their niche. With direct access to a network of wealthy businesswomen and expat ladies-who-lunch, the magazine doubles as an events organiser, inviting its readers to exclusive in-store shopping evenings.

“These events are a great chance for brands to show their new collections,” explains Ragozhina. ”Many of the ladies who come to these events lead busy lives, or maybe they’ve never actually visited a particular store or they aren’t familiar with the brand. There may not be large sales during the evening, but many of the ladies will go back. They like to discover something new.” Far from dismissing the events as just a room full of wealthy ladies whose names all end in ‘a’, luxury goods companies, like De Beers, are keen to learn more about the developing tastes of the Russian consumer, whether in the UK or back in Moscow or St. Petersburg. “The old cliches no longer apply – Russian consumers aren’t just buying the established, big-name brands,” says Ellen Spann, a former Moscow resident and public relations director for the De Beers LV retail venture, one of the 50 companies that has hosted New Style events.

“They like to have choice. Most of the luxury stores in Moscow are part of shopping centres or concessions in larger stores – they like to have everything in one place and to choose.” While not creating jewellery that appeals to a specific Russian consumer – in the UK or abroad – De Beers is still interested in courting a market that has the power to be highly influential in its spending power. “While it’s not a significant market for us at the moment, we’re interested to learn more – but give it a couple of years and this will no doubt change,” acknowledges Spann. It may be China hitting all the headlines as the Eldorado for luxury goods companies thanks to its rising middles classes, but Russia’s gross domestic product is set to rocket by 70 per cent between 2000 and 2010, while consumer spending forecasts show an impressive rise of 69 per cent.

According to Retail Fashion Opportunities in Russia, a recent conference held in London and organised by fashion trade title Drapers, brands are of utmost importance to Russian shoppers, with 40 per cent looking specifically to buy branded goods. It’s no understatement to say that the Russians adore big fashion names and labels. “It’s a status symbol, they say ‘this is who I am’,” explains Ragozhina, while motherof- two Tatiana Volosenko, attending the latest New Style event at Loewe’s Bond Street boutique – the LVMH-owned Spani sh brand known for its limited edition luxury leather goods – reels off a list of her favourites: “Dolce & Gabbana, Louis Vuitton, Gucci – Russians love their brands,” she says, adding Yves Saint Laurent, Prada and Chanel to the list (“I love Chanel, of course!”). Yet there’s a distinct lack of brand loyalty among this group. Take Lally Nickatsadze, the neatly-coiffed, high-cheekboned wife of a wealthy Georgian businessman. Attending the New Style event at Loewe with her friend Tamara Smales, the icy blue-eyed owner of a Georgian oil firm, Nickatsadze speaks frankly about her shopping habits which, belying the bold black and gold-buckled Versace clutch she’s sporting, are surprisingly restrained. “When I first moved to London about 10 years ago I lived near Park Lane. There wasn’t much for me to do apart from go shopping on Bond Street, but I didn’t buy a thing for about seven months. I just looked around to make sure that I really knew what I wanted to buy.”

Even now, Nickatsadze’s purchases are carefully weighed up and calculated when she heads every season to her favourite haunts, Harvey Nichols and Harrods, to spend a couple of days checking out the variety of brands on offer before heading home to make a list of what she’s seen and what she’d like to buy. “I write everything down and then I think about it for a few days. Then I go back and buy what I really want – I never buy on the spot.” Smales nods in agreement, adding that there’s no particular brand she feels typifies Russian taste. “I think Russian taste is becoming more of a fusion,” says Zoya Kempl, a sales manager and social fixer at New Style. “It has always been colourful – like Middle Eastern tastes – but it’s not always the same for everyone. You can’t generalise any more.” If we’re talking fusion, is the Russian contingent in the UK picking up on the British approach to mixing and matching designer clothes with disposable high street looks? It’s a pertinent question for those chain retailers such as Zara and H&M who are all keen to crack the domestic Russian market. Nickatsadze and Smales look blank, dismissing the idea of cheap, chic, chain-store style straight off – all apart from one retailer, Marks & Spencer.

“Knickers and trousers – that’s what I go there to shop for. They fit very well,” says Smales. So it’s big name fashion brands for the increasingly discerning, top-end Russian consumer. Ragozhina is upbeat about the growth of this group’s spending power in the UK, believing that, “over the next five years there will be more opportunities and possibilities”. No doubt more luxury goods companies and services will be sitting up and taking note.

Fiona Harkin is a senior editor at Worth Global Style Network (http://www.wgsn.com/)
New Style magazine: http://www.ladiesinfo.com/
Retail Fashion Opportunities in Russia: conference http://www.fashionrussia.co.uk