I will have to go back about seven years ago now when Andrew Lloyd and Kevin Rose got together and summarised their experience in the field of cross-marketing. They had both been dealing with high-end brands in various fields of luxury goods and services, and were active in helping clients develop loyalty programs and client relations. So basically they put together a cross-marketing agency which they called The Luxury Network. We are the franchisee for Russia. We deal with foreign companies who are represented here, or with Russian companies who are of sufficient quality, whether they be providers of goods or services.
The number of our members is not as important as their quality. We now have a dozen solid members. Our founding member was Rolls Royce Motors Cars Moscow, which set the tune because we aim to acquire as members the Rolls Royce of companies in different niches, such as Masterskaya Classicheskovo Kostiuma (bespoke tailors), Royal Wellness Club in fitness and wellness, Avrora Clinic in dentistry, Alexander Metlin in furs and Novoye Kachestvo (âNew Qualityâ) in real estate. We bring representatives of these companies together to co-brand and cross-market, we seek out upper-crust marketing opportunities for them. We work with owners of companies, with GMs or even marketing managers, with people who are clearly interested in making their businesses grow.
What sort of events do you organise and why?
The one event that I should like to refer to first is our Annual Luxury Network Russia event. This is an occasion when all members come together to display their goods and services, itâs a gala evening where everyone can bring their clients. Obviously other members of the network are there so participants can make new client contacts. The gala coming up later this year will be our biggest yet, and we are looking at the possibility of bringing about 200 high net worth individuals together to be entertained, and to see membersâ products and services in whatever way members will display them.
We are now putting together a string of smaller events which will be held in membersâ premises. A representative of that company will deliver a speech or a lecture on a topic relevant to the companyâs trade, and about 20 to 30 members will attend. This is a good number, because keeping it small means that the host will have enough time to meet and talk to the people he or she wants to, to create contacts.
What is happening in the luxury sector in Russia?
The luxury sector is Russia is going through quite a transition. We have had three or maybe five consortiums which have become the key players on the luxury market here. Theyâve accumulated quite impressive portfolios of luxury brands, which are at times put into the shade by the faÃ§ade of the owning company. Many brands now seek independence in their marketing policy. Some of them are opening their own flagship stores, hiring managers that will run their marketing policy here. So the luxury network is something really instrumental for the likes of those companies.
The only sector of luxury goods that has shown consistent growth over the past two to three years is the automobile industry. Since the crisis of 2008-10, wealthy Russians have really cut their expenses on luxury goods and services. The travel industry has suffered quite badly, along with a few others. We see quite a slow down in luxury for example, that having to do with the cuts in new housing acquisition and new homes. It is wrong to think that Russia has been completely immune from the economic malaise that has hit other countries. But somehow the automobile industry has been doing well.
What services do you offer your Russian members?
We offer a whole marketing mix, with the joint events and the member events. The events are quite significant, because each of our current twelve members holds a minimum of two events a year, add that up with a couple of Luxury Network events and you are looking at 26 events a year. All of these events can be used for product placement and networking with potential new contacts and clients. We have a luxury network brochure, which brings all members together in a two page spread, and the distribution is a die-for for companies catering for high net worth individuals here; because it is distributed at points of sale, or points of client contact of each member. So take, for example, the Royal Wellness Club, they will have the brochures at their reception and by their bar. It is also distributed as a quarterly supplement to a monthly magazine called Top Flight, which is published by one of our members called Business Aviation Club, with a circulation of 25,000 copies. The magazine is distributed on board business jets, and a Luxury Network advertisement is featured in every issue of Top Flight. This is where brand alignment starts working for all our members.
What services can you offer international luxury brands looking to introduce and sell their products in Russia?
We can certainly give them quality exposure within the right circles. Having brought together a dozen member companies, we are now talking to about 10,000 clients. Our newsletter goes out to at least that number of people, and these are all high net worth individuals.
International brands can most certainly enjoy our events and take the opportunity of product placement. They can place their products and talk about their services at the small scale events that we shall start running from September, and that will be at least an event a member, so the schedule will be quite busy. We can have some of their products featured at membersâ points of sales. An example here would be Kazumian cognac being seen and actually offered to other member clients. When people buy themselves a new Rolls Royce for example, among other presents, they receive a bottle of Premium Kazumian cognac.
We provide a direct marketing inroad for a minimum cost. We are the shortest way to your Russian high net worth client. You donât have to spend hundreds of thousands of Euros in advertising to achieve what you can by becoming a member of the Luxury Network Russia. Itâs quite a money saver.