Competition for customers among clothing chains is growing
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The peak period for fashion retail, August-early September, was relatively favorable for retailers. Stores in Moscow managed to record an increase in the average check by 10% year-on-year and an increase in traffic, although the number of customers at the outlets decreased. The latter is explained by growing competition between retailers, high consumer sensitivity to prices and the gradual return of people to shopping centers who come not only for specific purchases.
From the beginning of August to September 3, the average check in fashion retail stores in Moscow increased by 10%, and traffic by 3% year-on-year, Focus Technologies calculated. The increase in the average bill there is associated mainly with rising prices. Director of the multifunctional real estate division of CORE.XP Evgenia Prilutskaya agrees that the increase in spending is unlikely to be dictated by the increase in the welfare of the population.
This period before the start of the business season is considered indicative in the retail and commercial real estate market. The peak of consumer activity usually occurs in the 35th week (August 28 – September 3). This year, the average check in clothing and footwear stores these days increased by 28%, and traffic by 37% by the beginning of August. Then the indicators began to stabilize. Evgenia Prilutskaya calls the restoration of traffic natural after a period of shocks associated with the pandemic and military operations in Ukraine.
Elena Nikitina, deputy general director of the Kanzler men’s clothing store chain, says that from August 1 to September 13, the average bill did not change noticeably, but traffic increased by 17.8% year on year. Baon President Ilya Yaroshenko notes a 10% increase in revenue in August, but for the past September period he still sees a decrease. The Snow Queen reports an increase in store traffic during this period by 5% year on year. The chain’s average check decreased by 10%, but this trend is attributed to an internal factor – an increase in the share of casual clothing in the assortment.
Mikhail Vasiliev, head of research and consulting at Focus Technologies, points out that, despite the increase in traffic, the number of direct buyers in fashion brand stores in August-early September was on average 3% lower than a year earlier. The expert attributes this to the gradual expansion of supply. There are more operating stores in shopping centers, the flow is dissipating, and competition with online platforms is growing, says Mr. Vasiliev.
The Lamoda online store reported that the number of orders in August-September increased by 18%, the average number of items per order increased by 8%, and the average bill by 5% year-on-year.
Managing partner of Vanchugov and Partners Alexey Vanchugov noted that the increase in competition between retailers is visible even based on their demand for premises located in areas with high traffic
As Mikhail Vasiliev notes, consumers today are quite sensitive to the cost of goods and can come to stores to choose clothes, and then order the desired items online, trying to find the best deal. Ilya Yaroshenko also noticed increased selectivity, adding that consumers can also be influenced by the general economic situation. “Jumps in the exchange rate increase the feeling of instability, people are more careful when buying,” he explains.
In general, according to Mikhail Vasiliev, the current dynamics of attendance indicates a gradual return to normal functioning of shopping centers. During periods of crisis, he recalls, due to the reduction in the number of operating stores, mall visitors were more likely to make purchases. The fact that consumers in general are returning to more familiar patterns is also evident from the occupancy of restaurant areas, says Alexey Vanchugov. The general director of the consulting company Eterna, Dmitry Tomilin, notes that the influx of traffic in any case creates a revitalization effect in shopping centers. “Today a visitor will come to look, tomorrow he will return and buy,” points out Evgenia Prilutskaya. But, she adds, the task of converting visitors into buyers must be solved by both the shopping centers themselves and the tenants.
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