Vogue Business: What luxury looks like in Russia now

ReD partner Charlotte Vangsgaard speaks to Vogue Business on how luxury brands are navigating the risks and tradeoffs of working in Russia.

Aside from the moral implications, it could alienate some customers, says Charlotte Vangsgaard, partner at strategy consultancy Red Associates. “As brands choose to actively participate in the cultural conversations of the moment… they also risk being judged by the morals and politics of the moment.”

On 15 March 2022, in response to Russia’s invasion of Ukraine, the European Union prohibited the sale, supply, transfer or export of luxury goods with a value of €300 or above into the Russian Federation, and credit cards issued by Russian banks were barred from the international payment system Swift. 

Beyond the sanctions, luxury conglomerates such as LVMH and Richemont suspended their operations in Russia — thus forgoing about 2-3 per cent of the €7 billion global luxury goods market, according to management consulting firm Bain. Yet, as the war has dragged on, Russia’s wealthiest citizens have still found ways to get their hands on luxury products…

Read the full article by Milena Lazazzera on Vogue Business