LONDON — Four international brands will enter the Russian market and open at two Mega shopping complexes in Moscow, owned by Ikea Centres Russia. An announcement was made in London this week at the International Council of Shopping Centres Retail Connections London Conference.
Armani Exchange; L’Oréal’s color cosmetics brand NYX, and the German and French lingerie brands Hunkemöller and Undiz will join names including Adidas, Calvin Klein Jeans, Converse, Gap, Lacoste, Levi’s, MAC, Marks & Spencer, New Balance, Nike, The North Face, Tommy Hilfiger, Topshop and Zara.
“We would like to diversify our client mix and Armani Exchange adds a bit of spice to our shopping centers,” said commercial director Olga Shevtsova. “Cosmetics went up 20 percent in sales and I’d say fashion sales went up by 15 percent, which shows the interest of the Russian consumer in this particular segment. Both we — and the brands — have high expectations.”
The company said that thanks to a government investment program of 2 billion euros, or $2.2 billion, Ikea Centres Russia will be able to develop new Mega shopping centers and Ikea stores, mall extensions and upgrades by 2020.
Armani Exchange and Hunkemöller are slated to open at the Mega Teply Stan and Mega Khimki shopping centers, while NYX and Undiz will set up shop in Mega Teply Stan.
Armani Exchange’s 2,100-square-foot stores will open next month and carry women’s and men’s apparel, shoes, watches, glasses and accessories. The store design will feature black and silver walls with crystal reflective material embellishments and matte textures.
The NYX unit will carry the makeup line and also feature a beauty bar. High-street lingerie brand Hunkemöller’s 1,000-square-foot space will carry its underwear range. French lingerie brand Undiz’s 1,200-square-foot store will carry underwear, beachwear and nightwear.
“We are always keen and open to add new brands to the portfolio, said Shevtsova. “I would say we are looking at three different angles: one is the brands that have high awareness outside the Russian market, brands that are not yet present and start-ups in the Russian market. We are trying to stretch, because historically we have always been focused on the middle class,” she said adding that the shopping centers will eventually offer everything from premium products to the lower value segments, “so that everyone can buy whatever they need.”
With regard to consumer spending, she said Russian shoppers are becoming more savvy with the ruble at historic lows and foreign travel dwindling.
“We always look at these times as opportunities and definitely economics has an effect. Retailers are trying to optimize their chains, their stores,” said Shevtsova. “In general, what we hear from our retailers is that they share the same strategy and believe in the longevity of the Russian market and also in consumer behavior, which is becoming more knowledgeable and smarter.
“With the exchange rate, Russian consumers are basically forced to spend their money within the country, and this is an opportunity for us to work better with our customers and attract them and have them spend more. It’s not only the spending, but it’s also investing in the destination as a meeting point and leisure dining. They don’t necessarily come and spend right away, but they come and visit our restaurants and have a good time and then they return and spend more. So we see this economic situation as an opportunity for us and for the first time ever, I think the prices in Russia have become less expensive than if you were to travel abroad.”
Launched in 2002, Ikea Centres Russia is a part of Ikea Group, which oversees and operates 40 shopping centers and 25 retail parks in 14 countries. The company has 20 projects in the works in countries including China, Czech Republic, Finland, France, Germany, Italy, Norway, Poland, Portugal, Russia, Slovakia, Spain, Sweden and Switzerland.
The company reported 275 million visitors a year with tenant sales turnover more than 5.6 billion euro, or $6.2 billion, in 2015.