The Will to Win
– I have been mad about cars since I was a child. From the age of 18, I started taking part in rallies. It became a way of life for me. It’s not surprising then, that once I had received specialised training as a Vehicle Operations engineer, I set up a transportation business. I was involved in the express delivery sector.
Established in 2009 by Rick Minne, RMServices provides services related to sports marketing, corporate events management, and to the development of motorsports business and of motorsports as a whole. It offers the corporate market a range of original products to assist in the promotion of business and in the improvement of corporate culture, and runs specific projects in the area of PR and teambuilding. Its key clients are large Russian and international companies with a variety of profiles, including producers of goods belonging to the luxury category.
In 2007, one of my clients decided to start his own business in Russia. I set off to Moscow with him as his business partner. And, just then, the financial crisis struck. We had to close two of our shops in the capital. For two years, I worked at a certain Moscow transport company. And then, I started my own business. I started off with marketing and arranging motorsports events. By then, I had already made friends with some Russians who were also very much into motor racing.
– Was it complicated registering your enterprise in Moscow?
– Our head office is in Smolensk: the one in Moscow is a representative office. Smolensk is very conveniently located: between Latvia, Belarus and Moscow. As regards the company formalities, everything went quickly and smoothly and was sorted out in three weeks.
As regards the company formalities, everything went quickly and smoothly and was sorted out in three weeks.
– What were your impressions of rural Russia?
– When I first went to Smolensk, it seemed to me as if I had gone back in time. Unlike in Moscow, there were no traffic jams. There were only three buses on the main square. But now the region has seen a lot of investment and everything is changing rapidly.
Denis Levinsky, PR Director of Eventum Primo:
— In Russia, all marketing communication tools, including event organising and PR, are beginning to catch up on both Europe and the USA. Alas, so far the theme of motor sport is not sufficiently popular. For example, in promoting various newsworthy events about Volkswagen and Skoda, we see that they get less reaction in the media here than from Western colleagues. However, motor sport has been gaining in popularity in recent years. The demand for the application of this theme in marketing is growing. There are not that many professionals in the market who deal with motor sport, so to ensure a high level of events and qualified technical expertise, mixed teams of car gurus and marketing professionals are being set up.
The cost of a Moscow startup in the field of PR and event organising is from 5,000,000 roubles. This figure is made up of the costs of creating the organisation, renting office space, procuring office equipment, paying salaries to staff, developing a website and taking measures to attract clients. The market is developing dynamically, and changing. There are more than a thousand agencies in Moscow alone. Whereas a few years ago the agencies did everything at once, the major players now beginning to appear have clear demarcations within their business – HR-events, MICE (meetings, incentives, conferences, events), event marketing and team-building. This makes it possible for clients to apply to specialist agencies.
We operate both in Moscow and throughout Russia. We have been putting on navigational rallies, sprint competitions, slaloms, and setting up overnight races on the European model. We have been getting routes ready with the same kind of conditions as professional ones. In this, we have been actively working alongside the regional department of DOSAAF (The Voluntary Association for Cooperation with the Army, Air Force and Navy).
– How do Western European rallies differ from Russian ones?
– Such events in Europe usually take place on an asphalt surface, whereas in Russia they are mainly on forest terrain. In the West, the preparation takes from six months to a year. Permission has to be granted by the mayors of all the cities the rally passes through. Issues related to insurance policies and safety regulations have to be ironed out. In Russia, everything is a lot simpler.
– Do Russian clients have any unique characteristics compared with western ones?
– For Russians, there is a lot that comes as a new experience for them. Auto racing in Europe has long enjoyed great popularity. A lot of people come along as spectators and to have a go themselves at some of the contests. The popularity of this kind of sport only started to grow here a few years ago when Vitaly Petrov made it onto the podium in the most prestigious event in motor racing: Formula One, and also when Evgeny Novikov finished in the top three in the World Rally Championship (WRC). In terms of clients, in Europe they are more disciplined. In Russia, for example, they can postpone the same event more than once.
Behind the Wheel
– What are the initial costs for getting a team together? Are they less than in Europe?
– Of course, in Europe, it is more expensive. In Russia, for a team comprising a driver and navigator, you need only 5,000 roubles.
– No doubt the organisational outlay is less, too?
– In the West, a small rally, similar to the one I put on here, costs four times as much. Even though the range of people involved is as wide as it is in the West: from the managers and engineers, to the journalists and landladies providing accommodation. And there is the widest variety of cars, which all have to be assembled in their own way. The length of the course is the same, though: 300 - 400 km. But in Europe at the moment, in economic terms, all is not well.
– Is being in this business in Russia more profitable, then?
– Definitely! For wealthy clients, we organise rallies in fast, expensive supercars like Ferraris and Maseratis. The start is in Moscow, it goes through Smolensk and Pskov, and the finish is in St. Petersburg. The plan is to provide TV commentary from the races. At the finishing line for the intermediate stages, we put on parties so that people can get together afterwards and relax.
In the West, a small rally, similar to the one I put on here, costs four times as much.
I have also come up with something exclusive to Russia: the corporate driving day. Companies invite their clients or business partners. They get to meet leaders in the world of motor racing. After those invited have been for a spin with a team of well-known drivers, they can then sit behind the wheel of a sports car themselves. These are a unique kind of master class. The cars are painted in the company colours. It’s a totally one-off way of doing business, but it works.
– What kind of car do you race in yourself?
– A Ford Fiesta ST. It has a two-litre engine and is specially designed for rally driving. About a hundred of them were supplied to Russia but, now, there are less than twenty of them left on the roads.
Stanislav Koretsky, Managing Director of Citrus events agency:
— The size of the Moscow events market was estimated in the course of a study of the whole market by BTL Services as about $160 million in 2010 and about $300 million in 2012. Specialists believe that the potential size of the market is as high as $700 million. Among the main players, it is worth mentioning the strategic events agency “Podyozhiki”, the company Eventum Premo and the celebrations agency “Knyazyev”. If you compare it with the Western market, I believe that there is no significant difference in the way the top agencies conduct their businesses. To enter the market, the minimum requirement is the development of the firm’s style (cost from $2000) and developing the website (from $3000). At least $3000 more will be needed for organisational costs.
– And what do you think about Russian cars?
– The Lada Kalina took me by surprise. You cannot compare it with the Lada that was made in the Soviet Union. We used to joke about that car that it has four pedals: accelerator, brake, clutch, and the fourth one is for pumping up the airbag.
– Have you mastered the Russian language yet?
– I started learning Russian whilst still in Belgium. I have an assistant there who translates everything for me. But I am attempting to master the language. On my days off, I drive beyond Moscow and go out of my way to talk to the country folk.
– Where is it easier to attract sponsorship: in Russia or in the West?
– Now, in the West, due to the crisis, it is by no means easy to find sponsors and clients who are willing to invest in sports marketing. In Russia, the difficulty is of a different kind. Companies are still not very familiar with motorsport: you have to explain everything to the clients in great detail. What helps, is that Moscow is the centre for business of the whole of Russia. After all, the head offices of many large companies are located here. We attract clients from all sorts of industries: oil companies, famous brands, those involved in sports car manufacturing, as well as firms producing popular clothing labels. We put their adverts directly onto the cars.
What helps, is that Moscow is the centre for business of the whole of Russia. After all, the head offices of many large companies are located here.
– How difficult was it finding a common language with wealthy clients, owners of expensive cars?
– I don’t have any difficulties with them. They are all avid car-lovers: we have a lot in common. What surprises me is something else. Russians think that the more expensive something is, the better quality it is. For example, I recently bought some winter tyres for my car at 2,000 roubles each. My Russian friend’s reaction was: “Wow, what a bargain!” He himself had paid out 9,000 roubles per tyre. Yet there is virtually no difference between them and my relatively cheap tyres.
– What would you say about the Russian mentality?
– Russians are very warm-hearted, always ready to come to your aid. If I make a mistake in Russian, no-one laughs: everyone tries to correct me, subtly. A distinguishing feature of Russians is their hospitableness, especially in the countryside. A few years ago, fate took me to Vyborg on the border, with a professional Peugeot rally team. We stopped in a tiny village, and an elderly couple fed us as if we were part of their family. You won’t encounter anything like that in Europe.
One Step Ahead
– What kind of difficulties have you had to contend with?
– Here, there is always something changing to do with legislation, bookkeeping. You go into an official establishment and they say: “A new decree has been issued”. And the next day, they are already passing amendments to it. I have a permanent residency permit. But, every year, I have to prove yet again that I am working in Russia and paying tax according to the proper procedures.
– How many people work at your company?
– There are five employees on the staff, and we hire more people for specific projects and events.
– Who are your competitors?
– Well, that’s the point: we don’t have any competitors in Russia! But I know full well that they will appear very soon. When people see that a business is successful, they also want to try something in a similar vein. I have a great deal of experience in motorsports, so I will always be, at the very least, one step ahead of them all.
I have a great deal of experience in motorsports, so I will always be, at the very least, one step ahead of them all.
– Have you learned how to negotiate with Russian officials?
– In the early days, in order to get to see the head of the region, I had to visit two dozen officials of varying ranks. They all had their own opinion on what needed to be done, and how it was to be done. Concluding agreements took up an awful lot of time. But now, when organising motorsports events, I just go straight to the regional head and receive the “all-clear” without any further delay.
– Are Russian partners reliable?
– You can be misled by both Russian and western partners. I had a few problems with certain companies. As soon as I felt that they might be deceiving me, I terminated our cooperation there and then. You have to rely on your intuition with such things.
– What is your opinion of Russian roads?
– The roads are like roads. Foreigners like to joke: “Beware of anyone driving down a Russian road steadily and in a straight line. They are drunk. You can only drive straight here, without avoiding the bumps and potholes, when it’s below zero”. But the problem lies not with the roads but with the drivers on them.
– Is the driving culture different from that in the West?
– Just a little! At first, I still used to be taken by surprise. When I would brake in front of a crossing pedestrian, several drivers behind me would start honking their horns. There were some who would rotate a finger near their temples, as if to say: are you some kind of idiot, stopping? Now, of course, it’s no longer like that. Everything is changing for the better with that.
– What do you have planned?
– I am preparing for an active cooperation with a certain large Russian company involved in organising exclusive, “top-of-the-range” events.
– Is it worth coming to Moscow to do business?
– Without a doubt! In Russia, the ones who thrive are those who are bold and prepared to take on any challenge and to improve themselves constantly. And what, in life, could be more interesting than that?