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The Moscow Times Moscow Guide – Winter 2008

Since the middle of autumn one of the most important topics of discussion, could only be … no, not the financial crisis… New Year! The winter issue of The Moscow Times Moscow Guide is entirely devoted to New Years celebrations. Seven great ideas for celebrating the “Night of Nights” will help readers finalise their plans and choose how and where to party, give fresh ideas and lots of practical advice.

And don’t forget – problems will come by themselves, but happiness and luck need an invitation. That why the more cheerful and light-hearted your celebration of the coming holiday is, the happier and more successful 2009 will be for you.

The Crisis: Signs of a Kremlin Fearful Of Unrest
Sociologist Yevgeny Gontmakher has painted a disturbing picture of what might emerge from the financial crisis, forecasting continued unemployment, huge protests and spreading violence.

Market Matters: Huge Grain Harvest No Boon for Farmers
This year Russia is enjoying the biggest grain harvest it has ever seen -- and farmers couldn't be more worried.



Thursday, January 08, 2009 Updated at 31 December 2008 22:36 Moscow Time.

The Moscow Times » Issue 3846 » Consumer News

John Wendle / MT

One Way to Sock It To 'Em

20 February 2008By John Wendle / Staff WriterPretty soon it may be easier for Muscovites to get a new pair of socks delivered to their door than to have a pizza arrive piping hot.

"Sox Bombs" and other subscription sock deliveries are now available from SocksOn.ru, an online shopping site, which opened in Moscow in December. The service, set up by Natalya Klimeshova and brothers Daniil and Sergei Volkov, brings new, black cotton business socks to your home or office on a subscription basis.

"It's an unusual gift, but men always need them and they are very practical," said Alla Kudinova, who ordered gift packages for two of her friends. "I think in principle it will be popular."

And the idea, inspired by successful Swiss-based company Blacksocks.com, seems to be catching on, though stumbling blocks remain in the Russian market.

Opened in mid-November in St. Petersburg before its Moscow opening, the site has attracted over 400 subscribers in a little over two months, based mostly on word of mouth, a couple of articles and some blogs and web sites.

"We get about five orders a day on average," said Klimeshova, 26.

Those orders come from people who lack the time to take care of the necessities -- the businessmen and office workers of the country's sonic-booming economy.

"The rhythm of life in St. Petersburg and Moscow is much faster, and people need something quick and simple," Klimeshova said.

The company's web site imagines the morning scenario of many a man "bursting into every drawer, looking in the laundry, under the sofa" for a pair of clean, matching socks. On the service page, they claim that "now you will not be late for a business meeting."

The other target has been women buying gifts for the men in their lives. In fact, more than 60 percent of the orders so far have been gifts.

Yekaterina Shapetko, a Moscow resident, bought a subscription each for her husband and her two sons. The Shapetko men will now be getting three pairs of black socks delivered every three months for the next year.

"If it's close friends or family, then it's not such a strange gift," said Shapetko.

SocksOn.ru has seven different subscription types. The least expensive, at 1,400 rubles, is the plan Shapetko ordered. The company also has an inexpensive one-time trial, a more expensive "Sock Bomb" of 30 pairs of black socks at one go, and a 3,500 ruble plan that provides delivery of three pairs of socks every month for a year.

John Wendle / MT SocksOn.ru has seven different subscription plans, including a trial offer called a Sox Bomb.

The socks are delivered all around Moscow and St. Petersburg using a few pensioners as couriers. "They know the city like the back of their hand," said Klimeshova.

Klimeshova now has 500 pairs of black socks sitting on the balcony of her apartment, waiting for orders.

According to the web site, the socks meet the "Russian GOST 3152-79" standard, which Klimeshova calls top-quality and said is better than the cheaper version sold by Noskinagod.ru, a copycat competitor that started up soon after SocksOn.ru.

SocksOn.ru accepts two forms of payment: cash on delivery and credit card payments directly on the web site.

"The service worked very quick and was easy," Shapetko said. "I just paid cash to the courier who delivered them in a pretty little package."

Setting up the credit card payments was "quite difficult," said Klimeshova. But Klimeshova's business mantra is that "you need to be patient and persistent and have fresh ideas."

And her ideas are fresh for Russia, even down to a marketing campaign with the slogan "stop running in circles, we'll do it for you."

"I see the value of the site," said Brady Martin, a consumer goods, retail and media analyst at Alfa Bank. "Moscow has a fast-paced lifestyle. But you also have high salaries and inconvenient retail structures," he said.

"There seems to be a need or an interest in these quality-of-life-type services," said Martin.

"If they shoot for that niche of the market that says, 'we make life easier for you, but it's not cheaper,' they will be a success," said Martin. "It's all about positioning."

With Hummers and Bentleys littering the streets of the capital and the GDP growing by 8.1 percent in 2007 according to Federal Statistics Service estimates, finding this niche should not be a problem.

"We're having quite a lot of fun. I didn't take it seriously at first, but now I'm planning on opening a whole Internet shop," said Klimeshova, who plans on possibly selling everything from dress shirts to toothpaste if the business continues to expand.

"That was something tried in the U.S. but it never took off," said Martin of SocksOn.ru's plan to expand.

Besides the failure of similar plans for the subscription delivery of household staples in the United States by Wal-Mart and other retailers, Martin projects other problems, especially noting the low penetration of the Internet.

"Penetration is still really limited and that will limit your market," said Martin.

The European Travel Commission's New Media Review estimates that only 19.8 percent of the Russian population is online. Of that, 46 percent of 18- to 24-year-olds are online, but only 31 percent of 25- to 34-year-olds and 23 percent of 35- to 44-year-olds -- the very age groups who are seeking convenience over cost.

However, "there are a lot of opportunities in Russia to develop ideas that have worked in other markets," said Martin.

"We're working on corporate subscriptions now," said Klimeshova. "Currently the strategic development department of the St. Petersburg city government are considering a subscription. Some banks have also shown an interest."

"The most important thing is to believe," said Klimeshova.