Operators caught a drop in traffic – Newspaper Kommersant No. 52 (7497) dated 03/28/2023

The number of telecom stores of operators in million-plus cities has decreased by an average of 5.5% since March 2022. Most of all, the fall in Omsk – by almost 15%, in Moscow, Rostov-on-Don and Nizhny Novgorod – by 7%. The trend is associated with a decrease in the income of the population and the optimization of the budget of operators, experts say. However, they suggest that a further serious reduction in the number of points of sale should not be expected.

“Kommersant” got acquainted with the data of the 2GIS cartographic service, according to which from March 1, 2022 to March 1, 2023, the number of offline communication stores in million-plus cities decreased by 5.5%. Most of all, the fall in Omsk – by 14.7%. In Moscow, Rostov-on-Don, Nizhny Novgorod and Novosibirsk, there is a decrease of 7%. According to a 2GIS representative, in general, in March 2022, there were about 4,000 communication stores in cities with a population of over one million, including kiosks and shopping islands.

The trend is confirmed by telecom operators. As of March 1, 2023, Tele2 reduced the total number of outlets by 1.6%, stores – by 0.9% year-on-year. However, the representative of the operator noted that “there is no avalanche-like decrease in traffic now”, it is declining “predictably”, so this year the number of outlets will remain at the current level: “There have been discussions on the market for a long time about the uncertain future of retail, but in reality, digital channels cannot completely replace offline ones and guarantee the maintenance of a stable level of sales of SIM cards.

An MTS representative said that the number of the operator’s stores in 2022 decreased by 4%, to 5.39 thousand points. “We will close points in locations with a small flow of customers and open stores in more advantageous places. As a result, the retail network will gradually decrease,” MTS added. The distribution format in telecom needs serious changes, VimpelCom confirms: “We are reducing inefficient outlets not only in the monobrand, but also in the partner channel.”

In 2022, retail turned out to be one of the most affected business segments of telecom operators. According to the results of the second quarter of last year, revenue from sales of phones from MTS fell by 47%, Tele2 – by 12%. Operators cited problems with the supply of equipment, a decrease in the purchasing power of the population, as well as an unstable dollar exchange rate as the reasons for the trend (see Kommersant dated August 19, 2022).

The reorganization of communication stores began during the pandemic in 2020, then over the year their number decreased by 15%, in 2021 – by 3%, notes TecomDaily CEO Denis Kuskov: “Now, due to a decrease in purchasing power and a general drop in sales, have a large number of retail outlets are unprofitable, so the trend will continue in 2023.”

The reduction of retail networks of operators is primarily due to a change in consumer behavior, adds Finam analyst Leonid Delitsin. According to him, during the pandemic, residents of large cities have become accustomed to ordering digital equipment online and receiving orders from marketplaces located inside communication stores. “From this follows the assumption that the potential for reducing the number of salons has not been exhausted,” he emphasizes.

M.Video-Eldorado does not agree with him: despite the fact that online shopping has become a daily practice, stores remain a key element for Russians when choosing and buying equipment, customers make 85% of transactions using the retail infrastructure, the network representative emphasizes.

“Before, carriers could allow telecom stores to open next to each other, door-to-door, trying to get the most out of a high-traffic area. Now the market situation is conducive to optimizing the budget and reducing unprofitable points of sale, ”says Anton Fomin, business analyst at F + tech – Marvel.

After some time, stores will begin to open again, as retail chains are more of a marketing tool, Mr. Fomin is sure: “Operators do not sell a separate product, but a comprehensive service – access to cellular communications, one of the components of which is a smartphone.”

Timofei Kornev, Yuri Litvinenko