Russia experienced an economic crisis in 1998 but its economy and those of other Eastern European countries have seen strong growth potential since then. A large, educated middle class is fueling demand for consumer goods. While capitalism and free markets are taking hold, many Russians are still learning the rules. Key industries include oil/energy and high tech, though infrastructure and political risks remain challenges. The market can be segmented by ethnicity, income levels, and attitudes. Local brands have strong loyalty but quality concerns exist. Distribution infrastructure is weak requiring new networks, and education of players and consumers is important for development.