Russia Silences Wine Advertising (by winespectator.com)

Posted: February 2, 2013 by wynmaker in Wine, World wine news
Tags: , , , , , , , , , , , , , , , ,

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A ban on alcohol advertising—and possibly articles—pits the government against a growing wine culture

Russia’s latest salvo in a long battle against alcohol abuse by its citizens is a sweeping ban on all alcohol advertising in media outlets. It’s likely to have an unforeseen victim: the country’s small but booming wine culture.

Russian governments have fought the country’s age-old culture of hard drinking for more than a century. A 2011 global report by the World Health Organization (WHO) on alcohol abuse cited Russia and its neighbors as the hardest-drinking countries in the world. Now, provoked partly by a rising tide of youthful beer binge drinking, the government is cracking down on what it sees as an important public health issue.

Few observers think Russia’s newly emerging and increasingly sophisticated fine wine scene was in the sights of the legislature, the Duma, when it enacted the advertising ban last summer. Nonetheless, the law, which took effect Jan. 1, has had an impact. It makes no distinction between beer, wine and spirits. All advertisements are banned in both traditional and online media, and state authorities have warned the ban may be applied to the editorial content of wine publications and newspaper wine columns.

“Wine is not one of the hit targets of the government … yet,” said Spiros Malandrakis, an analyst of the global drinks markets for Euromonitor International, a London-based market research firm. “They mostly focus on hard liquor and beer, but the law makes no distinction.” Beer in particular has been a sore point, and to stem the tide of its growth among young people (Russia’s legal drinking age is 18), the government in recent years has doubled excise taxes, limited hours of sale and, as of January, outlawed sales from sidewalk kiosks.

According to WHO’s 2011 study, the average Russian drinks the equivalent of about 15.7 liters of pure alcohol per year—65 percent more than in the U.S. Nearly two-thirds of the alcohol consumed comes from hard liquor, one third comes from beer and only 1 percent from wine.

Nevertheless, wine consumption is growing at a steady 6 percent a year, according to Euromonitor. At the top end of the market, fine wine is growing much faster—middle class and affluent Russians are turning away from vodka and looking to wine as a less potent, food-friendly alternative. Importers say that the market for wines from France, Italy, Spain and the New World—after a downtown following the 2008 economic crisis—has rebounded with double-digit growth. And Russians are willing to pay the price for quality. Because of high import taxes and markups, a bottle of wine sold in boutiques and restaurants is generally three to five times more expensive than the same bottle in Europe or the U.S.

Read on …

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