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Introduction to Event: Millionaire Fair

Background

The Millionaire Fair officially was established first time in Amsterdam four years ago by a Dutch entrepreneur - Yves Gijrath. In the early day, its foundation basically reserved for advertisers and readers of Miljonaire magazines for rich and famous people. After the show it had sooner set up a respective reputation that devoted to the world of luxury. Organizer of the fair found Russia to be a potential and perspective market for luxurious goods and life. Then its first time in Russia, the Exhibition Moscow co-orperates with publishing house Independent Media Sanoma Magazines to organize this luxury event in September 2005 1. This time appealed more than 200 famous companies and brands which can be noticeably listed here like : BvlGari, Bentley, BMW, Cartier, Fairline, Jaguar, Remy Martin, Mercedes, Mont-blanc, Porsche, Riva, Rolex, Sony, Stairline and so on 2. It was also so-called the most famous luxury exhibit in Europe at that time. Until 2007, this fair editions officially spread to international markets in Shanghai, Moscow, Cannes and Kotrijk .

Anyway it is fair enough to say that Millionaire Fair Moscow 2007, indeed outstood above all others fair of the international luxury goods industry because of its huge success. With one year of preparation, organizers made it amazing in a hospitable environment for Millionaire Fair’s participants and invited guests during the period of time from 22nd to 25th of November,2007 at Crocus – Expo , Moscow. The dress code is strict: elegant tuxedos for gentlemen and beautiful night dress-up for ladies that is easily recognizable the most stylish and elegant customers right from the first opening ceremony night. Various shows, performance, music concert, auction presented the superb surprises and excellent entertainments which worth the most long-waited event of the year, for example: fine dinning show of the Italian Academy of Fine Dinning “ Academia del Gusto “ 2. Lists of luxury and extravagant goods and service were provided to guests who want to experience their selves in an pure world of luxury and enjoy unfadable moments that they had never felt before. In addition, the best unique products concluded cars, yacht, planes, interior, real estates and antiques, the most exclusive ornament, the most refined cuisine and even the biggest star as well 3. That was the way Millionaire Fair Moscow 2007 led to its biggest success – new luxury trend of lifestyle effected on global life.

Objectives

In this report, the author is going to analyze the impacts that Millionaire Fair Moscow 2007 and community interacted mutually in both negative and positive ways. Here below is the list of what aspects are investigated and discussed in this reports:

• Political impacts
• Tourism and economic impacts
• Socio-cultural impacts
• Developmental and environmental impacts
• Political impacts

1.1 Positive impacts

It goes without saying that politics all the time plays the most important role in the development of each country. This issue is coincided in Russia and especially its capital – Moscow. That is the reason why the author picked up this “Millionaire Fair“ as an event has a specific effect on political life. Regard to three main foreign policy objectives in 2007 are “ establishing itself as a power in world politics, securing territorial integrity and stability of its vast Eurasian landmass and participating in international trade and finance “ 4, the last one is highlighted as the main aim of launching this event at the third time in Moscow. Once an event has taken place, it would have an interaction with politic. For example on the occasion of “ Millionaire Fair Moscow 2007 “ the Real Estate Development and Asset Management Company - Saraya, investing in the Travel and Tourism industry took part in the celebration of luxury for the first time to perform their world-class products and services of unique luxurious lifestyle and destinations. Because of the political impacts of supporting foreign investment, Russia is demonstrating to be an active and potential market. Millionaire Fair, therefore, has evolved its entrances to 40,000 visitors in comparison to 38,500 in 2006 5 that are targeted in high-end luxury consuming segment.

As we know in the long-age history of Russia, it had fallen into economic crisis then the collapse of ruble, financial problems and weak oil prices, until Putin authorized the country in 1999 and implemented urgent methods in order to make the huge economic operation revival. As a result, gross domestic product rose 6.8 percent for the last eight years, fiscal balance was consolidated particularly rocketing in foreign direct investment and foreign exchange reserves 6. That is why this third pavilion is, in where, more than 250 companies specializing luxury products all over the world took part.

1.2 Negative impacts

On the other hand, Moscow government is encountering one of the social problems is public inflation. For instant, in 2007 authorities would be unable to pull inflation down to the level of 8% annually as planning before. It stayed already 10,6% at the end of November. So all the economic events of the years hardly decrease public inflationary expectations, even though, new policy was implemented to convince traders to freeze prices voluntarily and a shopping trend was born “ it’s better to buy goods today than tomorrow” 7. The sellers obviously were so happy with this and supposed to raise the prices today but not tomorrow. That would be restricting foreign investor while participating in Millionaire Fair to launch their business in this market economy.

• Tourism and economic impacts

2.1 Positive impacts

As can be seen from Millionaire fair is recently how far Russia has come since one of Putin’s three broad objectives: “ to create economic growth and restructure the Russian economy, and to establish Russia as a power and player in international affair”. This means from politic development, economy was growth up strongly and led to a wealthy Russia by the strong ruble in spending on foreign consumer products. Once the purchasing power has increased then would involve the needs of goods in term of both quality and variety. Parallel three main foreign policy objectives as mentioned above, they all meet up at the same point and focus on the same objective is to expand Russia’s importing economy that, therefore, absolutely pushes up the needs of exhibitions and events in any field. Especially in this luxury market, Millionaire Fair opens the doors for potential investors who want to try to set up their brand names in eyes of connoisseurs and big spenders in Russia, for instant : the Sarya as mentioned above.

On the other hand, this luxury market took a noticeable innovation in 2007 compared to 2006 in the quantities and categories of the brand participants: 250 companies in 2007 and 100 ones in 2006, or even attracts more 17,500 visitors than 2006. This time was a big success ever because the fair exposed abundant of unique luxury good, some of the highlight included one $1 million diamond rim, one $ 350,000 Mercedes car covered in swirls of Swarovski crystals, limited edition Boucheron Vertu Phones sold at the price of $350,000 per one and so on 8.

Because the fair is not open for just rich but for everyone to enjoy it so that obviously was the event filled up by millionaires whose purchasing power is strengthened basically based on a firm oil and gas driven economy. According to GfK, car and mobile phone ownership grew remarkably in 2006 and then Millionaire Fair Moscow 2007 was the only place where Moscow Auto salons dominated not only in quantities but also in the presentation of displayed brands: Ferrari, Spyker, Wiesman, Volvo, Audi, Infiniti, Cadillac, Lexus and many others 9. Without any doubt, the event were taken place successfully that proved an economic development in extravagant luxury living standard. It also created a foundation for tourism of Moscow while it attracted over 1.6 million tourists in 4 last months of 2007 – increased 15% in comparison to same period of 2006 10 including more than 40,000 guests visiting Moscow in annual event Millionaire Fair 2007.

2.2 Negative impacts

In contrary, tourism also brought to events or other specific festival some negative impacts. The best sample is Moscow’s hotel rate 2007 had no growth rate and the cost and availability of land in central Moscow is one of the prime barriers of strategic planning for new hotels. It also means that part of tourism revenue is going to be lost in the future because of bad experience of visitors.

• Socio-cultural impacts:

3.1 Positive impacts

Millionaire Fair Moscow 2007 was expected as a long-awaited event in the social calendar. With a big quantity of international visitors from all over the world, the fair also drew lots of millionaire and billionaire of Russia to involve in this event. It means that number of millionaire and billionaire is skyrocketing like being estimated: around 33 billionaires and over 90,000 millionaires11 and Moscow is considered as house of rich people more than New York. And as you can know money can buy everything except for happiness but at least it gives us the jolly moments in life too. High demand of high quality living standard is relatively set up toward to economic development and Millionaire Fair is an annual event to meet that needs. A total number of 40.000 guests attended a four day orgy to be the witnesses of unique exclusive luxury goods, aspired by conspicuous performances of hundreds of well-known brand exhibition. For example, opening ceremony reached 12000 visitors in the most awaited social party of the year by a sensational premier performance of Blue Man Group in Russia which was shown by Volvo especially for Millionaire Fair. In this time, Volvo presented to guests the new Volvo XC 60, which captivated audiences in light, sound, color and music special effects of the main stage.

Along high quality leisure facilities for a physical life, Millionaire Fair Moscow 2007 differed from previous fairs in an evolution in luxury consumer tastes when the art comes next to cars, watches or fashion. Typical sample is the art of jewelry creation about the latest collection of the world famous jeweler by David Morris 12 or an Italian relaxation chamber that is about 60,000 euros or nearly $90,000. On the second day of exhibition, a closed-door auction was carried out and the profit was send to the charity “ Noble House “ to help low income children in Vladimirskaya Oblast. It showed that Millionaire Fair is not simply an economy event but interacts Russian society.

< Source picture : http://www.millionairefair.ru/eng/gallery/photo?509&year=2007 >

Last accessed on 13th March, 2008

3.2 Negative impacts

As above the author said about the billionaire and millionaire rate rocket of Russia or Moscow specifically in the market economy, it creates the growing-up space among social classes. But it is fair enough to say that Millionaire Fair is not just for rich people because the ticket was sold at 30 euros per person per day, so it threw opportunities to all attendees to take advantage of luxurious publication show of the year.

• Developmental and Environmental impacts:

4.1 Positive impacts

During the Millionaire Fair 2006, the partnership between Millionaire Fair and Life Line Charity Program Yield achieved the aim of saving seriously ill children program. One of the best example is the successful operation on two small girls with congenital heart disease 13. In this time 2007, Millionaire Fair Moscow expanded its support to two primarily charity programs: continuing “Life line” and WWF Russia’s “Reserves and National Park”. A part of ticket sale revenue was donated to Reserves and National Park of Russia Fund 14. This program focuses on the Russian wildlife and reserves. It has been launched for 10 years to call upon every single people to contribute and develop efforts to preserve the natural environment, rare animal, plants and those are facing extinction. So far it aims to avoid specific terrorists and simultaneously develops ecological education and ecotourism 15.

4.2 Negative impacts

However, once again the problem of development affected the event was related to economic problems. As be aware, Russian economy depends mainly on their two important export products oil and gas. But oil and gas are limited sources and the oil deficit in the 2007 federal budget rose to 8.3% compared to 4.3% in 2004 16. That was the bad side on the state finance rate. And if optimistic changes of economy affected positively the event, so does the pessimistic ones.

CONCLUSION

In summary, the Millionaire Fair Moscow 2007 was the most remarkable event in 2007 of Russia. It gained lots of benefit to the host country Russia. Due to political changes, that was a favorable chance for this event on its own way to reach its main target segmentation especially Russian riches. In other aspects like society, culture or economy, there were diversity determined interactions as well. For example, during the event, lots of people was appeal to come and travel Russia that distributed well to tourism development. Otherwise, this event is one kind of media tools to advertise its country, culture and society to people all around the world and once again generated profit for Russia throughout tourists, foreign investors or other attentions. However, it is unavoidable from disadvantages of this event. Like the dividend of class in society is clearly visible, from that the author thinks this issue would be the loss of social balance and one of hindrances in developing economy and politic of Russia. Anyway, in author’s point of view, it is good to continue launching this event but in term of authentic precise policy and developmental strategy plans of hosted country.

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