During the Soviet era in Russia luxury was far from a priority of the communist government. One could even say that the idea of luxury itself sat in opposition to the Marxist ideals of the Soviet state. Over the past twenty Russia has endured many challenges while trying to transition from communist control to a democratic and capitalist state but finally a new Russia is beginning to emerge from the old. Moscow has been listed as the world’s most expensive city two years in a row and named,” Luxury Travel Destination of the Year”, by the New York Times. That is a huge accomplishment for a city whose reputation ten years ago was closer to a mob controlled crime ridden wasteland than a luxury destination. This Luxury boom is credited to high oil and gas prices that have fueled exceptionally rapid growth in the Russian Economy.
In the years following the collapse of the Soviet state the Russian luxury market was comprised of a small band of the ultra-rich that had a thirst for diamonds and extravagance who generally lived in London and other cities outside of Russia. Over the last few years that has changed and a new more casual youthful luxury consumer has appeared on the Russian landscape. Young Russian designers such as Igor Chapurin (known as the Russian Armani) and Dasha Zhukova (Kova & T. Zhukova) have begun to make a mark on the international scene paving the way for a uniquely Russian version of luxury goods. Russians who were once not allowed to leave their borders are now traveling and working internationally and want the same type of luxury experiences they have experienced abroad at home. Until 1997 there was hardly anyone to build a business on,' says Olga Mamonova, vice president of JamilCo, which runs Hermès, Burberry, Ferragamo, Chaumet and Escada in Russia. 'Then our client base was in the hundreds. Now it's in the thousands. But it's not just about money. To buy an Hermès scarf you don't need to be a millionaire. You just need to understand that it is a beautiful thing to own. That is real luxury. Not the price of the item.' Russia has changed and so has their idea of luxury, look for enthusiastic young Russian entrepreneurs to make Power Plays in the world market.