In February 1989, Ogilvy & Mather became the first officially registered Western ad agency in the Soviet Union by forming a joint venture with Soviet shop Soyuztorgreklama and Hungary's Mahir. At the time, the closest thing to an ad was a print effort featuring a dreary faded blue globe encircled by a rusty airplane and the slogan, "Comrades! Employ the services of Aeroflot!" The real joke was not the ad's complete lack of marketing finesse but the fact that if they wished to fly, they had no choice but to use the decrepit Soviet state airline anyway.
Today, there are other known airlines, such as Transaero, and they compete for customers. There are also marketing surveys, giveaways and reels of commercials for such familiar Western brand names as Snickers, Milky Way, Coke, Pepsi, Wrigley's, Uncle Ben's, Lucky Strike, Whiskas, Pedigree Pal, Ariel, Tix, Bayer and Panadol.
The business is sufficiently new that there are still no numbers for overall ad spending in Russia. But there are more than 100 listings in the Moscow phone book alone for ad agencies, and hundreds of marketers are advertising.
"This has become a conspicuous consumption society," said Bruce Macdonald, general director ofBBDO Marketing and a five-year Moscow veteran. "With all these changes, we feel like we're becoming a real advertising business."
Once competing mostly for the chance to arrange the occasional product introduction news conference, agencies today call themselves full service organizations with their own creative departments churning out slick, Western-quality ads.
McCann-Erickson Russia, for example, had $234,000 in billings in 1992 when it closed a joint venture with Novosti and went it alone. Today, General Manager Simon Hewitt is estimating $15 million to $20 million in billings for 1994 from blue chip multinationals including Coca-Cola Co., General Motors Corp., Opel Europe, Nabisco Foods Group, Gillette Co. and R.J. Reynolds International.
Gradually over five years, the Western shops such as Saatchi & Saatchi Advertising Worldwide, Dentsu and Boston agency Friedmann & Rose have also helped develop a generation of young Russians eager to embrace consumer goods and understand marketing.
When BBDO first hung its shingle on the back door of an out-of-the-way meteorology exhibition hall in northern Moscow, the three employees spent most of their time on public relations and market consulting. Today, the 25 to 30 staffers devote at least 60% of their time to media and creative projects, Mr. Macdonald said.
Back then, when concepts like marketing and advertising were still thought of as a capitalist disease, founders Gary Burandt and Michael Adams wondered whether they would live to see Young & Rubicam/Sovero, Y&R's joint venture set up in April 1989, make its mark.
By the start of 1993, an exuberant Mr. Adams was saying that Y&R was "farther along than I ever imagined we'd be," with $5 million in billings, a fully staffed creative department and ads for Sony Corp., Jacobs Suchard and Russia's privatization campaign rolling out nationally.
Also, the agency passed a milestone with the departure of the first generation of foreigners to head it when Mr. Adams returned to his Burson Marsteller office in Chicago last year, retaining his ceo title. Mr. Burandt departed soon after the agency got on its feet in April 1990.
There are thousands of Russian ad agencies. Take Avrora, a shop that now boasts 70 to 80 local clients, several Russian and international ad prizes and a new office opening in Miami.
Avrora General Director Vladimir Filippov said that though there are thousands of shops in Russia, very few can be considered agencies in a Western sense.
"An agency, in my view, is a company that takes care of all facets" of a client's advertising, he said, adding that most Russian agencies are more like brokers with access to certain media that they sell at discount to advertisers with in-house ad departments.
Like most of the other Western agencies, O&M, now independent of its joint venture, has seen business skyrocket to $5 million as international clients like Seagram Co., Shell Oil Co., Mattel and Rothmans International have moved in.
O&M is especially known for its TV commercials for Denmark's Dandy Candy Chewing Gum brand Stimorol. The Stimorol spots use the marketer's European theme line, "The original strong taste," translated into Russian as "Inimitable, long-lasting taste" and show scenes of the U.S. West.
One commercial shows an American-style he-man being chased and pulled over by two police officers, including a woman named Johnson. Officer Johnson is charmed by him and inks her phone number on the back of his speeding ticket.
In 1989 or 1990, one of the few ads around just showed a company logo and address. But today Western-style image, color and humor have taken over.
A TV spot for one of Russia's swiftly multiplying banks, for instance, tells the story of a struggling boy capitalist who washes car windows and looks about in awe at classy office furniture and miniskirted secretaries as he makes his way to the office of the bank president, who accepts him as a client.
Marketers' "old idea of `They'll buy what we make' is disappearing," Mr. Macdonald said. "Now, they're talking to the consumer, and their ads are telling the public why their [product] is better."