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Interview: Russian Standard’s Roustam Tariko

August 9, 2013

EDITOR’S NOTE: Russian Standard is Russia’s biggest vodka producer, with a portfolio led by flagship vodka brand Russian Standard, whose global volume was 2.9 million cases in 2012, according to Impact Databank. In the U.S. market, Russian Standard vodka was up 19% to 220,000 cases last year, earning an IMPACT “Hot Brand” award. The line includes Russian Standard Original ($20 a 750-ml.), as well as Russian Standard Platinum ($25-$26), Russian Standard Gold ($30-$35), and ultra-premium vodka Imperia ($40).

In June, Russian Standard completed its acquisition of Central European Distribution Corp. (CEDC), bringing its total annual volume to 34 million cases and adding vodka brands Green Mark, Zubrowka, Parliament, Zhuravli, Absolwent and Soplica. Green Mark, which will be a key export player among the newly acquired brands, sold 6.9 million nine-liter cases globally last year and is a leader in the Russian market’s mainstream vodka segment. Russian Standard is currently launching Green Mark in the U.S., where it’s retailing at $12.99 a 750-ml., competing in the mid-premium segment, which saw 12% growth last year.

SHANKEN NEWS DAILY executive editor David Fleming met recently with Roustam Tariko, Russian Standard’s chairman and founder, to get an update on the CEDC deal and look at progress at home and abroad.

SND: The CEDC acquisition added more than a dozen brands to the Russian Standard portfolio. What are the biggest changes that will result from this deal?

Tariko: I believe Russia needs to reclaim its territory in vodka. Some argue that consumers don’t care about vodka’s provenance, but 70% to 80% of the global vodka category is of Russian origin. I believe Russia will play a significant role in defining the category’s future global presence and strategy.

SND: You’re seeking to boost the export presence of some CEDC brands. Which do you see as having the biggest potential, and where?

Tariko: Our priority markets are the U.S., the U.K. and Germany, followed by Eastern European markets and then Asia. Green Mark is one of Russia’s biggest vodka brands and indeed among the biggest in the world. It has huge potential in Western markets. I’m hoping it will repeat the success it has had in Russia and Eastern Europe. Zubrowka has a 600-year-old recipe and is a beautiful brand with great tradition. (Zubrowka, marketed as ZU in the United States, transitioned from Rémy Cointreau USA to the Russian Standard USA portfolio this past spring.) Those are probably the two key (export) brands from the CEDC deal. Together with Russian Standard, they will be our focus.

SND: What are your biggest export markets at present?

Tariko: Number-one is the U.K., where Green Mark recently celebrated its first full year by passing the 100,000-case mark. Combining that with Russian Standard, we will reach 1 million cases in the U.K. next year. The U.S. is number-two and Germany is number-three.

SND: What’s your vision for the U.S. market? What do you wish to see happen there in terms of volume, and how will you get there?

Tariko: I don’t know where vodka’s flavor craze will lead, but I do know that people will always gravitate toward classic products, and we want to fill that role with Russian Standard. It’s very unlikely that we’ll go with flavors for Russian Standard, but that wouldn’t stop us from launching flavors for other brands. We have many brands now, so we can be much more opportunistic. Right now for Russian Standard, we’re focused on promoting our claim to be the best tasting, pure, natural crafted vodka.

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