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Shopwatch: Russian Retail

Moscow Landmarks: The rise of Russia’s nouveau riche has been followed by the evolution of its shopping centres.

Russia is a complex retail market at the best of times, but this is particularly true right now as the country grapples with political and economic uncertainty. Despite this, with an affluent urban population keen to buy into international brands, its major shopping centres offer significant untapped potential for international retailers.

However, retailers remain divided on their approach to the market. With western sanctions still in place as fighting continues along the border between Russia and Ukraine, some like New Look are looking to exit the territories, with the company expecting to have closed its 20 Russian and six Ukrainian stores by the end of this month. Others, like Mango, which has 170 stores, and Benetton, which has 108, are expanding their portfolios to tap into the wealthy customer demographic.

Since temperatures in cities like Moscow drop to -10C on average in the winter, Russia’s retail market revolves predominantly around covered shopping centres and department stores where shoppers are protected from the elements, and due to the sheer scale of the country - it comprises 14% of the world’s land mass - most international retailers that do have the confidence to tackle Russia tend to take Moscow as their starting point.
Following a recent trip to the Russian capital, Drapers looks at four of the top shopping centres and department stores, all of which attract the biggest international retailers and brands but serve very different purposes.


The GUM department store on Red Square was opened in 1893 as a gallery of small shops. Today it is owned by Bosco di Ciliegi, a Russian luxury goods distributor and boutique operator, and houses more than 200 brands.

Thanks to its location opposite the Kremlin, GUM is largely a tourist destination, and as such seems to act more as a marketing exercise for brands rather than a means of boosting sales. When Drapers visited, more shoppers at the 861,000 sq ft scheme were taking photos and having a cup of coffee than carrying shopping bags or walking into the shops that line the three galleries.

And there is much for the tourists to admire. The intricate glass roof lets light flood down through the upper two galleries and across the ground floor, while the ornate building had classic cars on display in the public spaces alongside fake autumnal trees. Another focal point was the central atrium which included a water fountain filled with watermelons.

International names dominate this department store, with the likes of Gucci, Louis Vuitton, Hermès and Versace represented among the luxury contingent. British names include footwear brand Barker and Monsoon Accessorize, while the owner’s own brands, such as menswear range Bosco Uomo and womenswear line Bosco Donna, also have space.

Kiosks line the lower-level public areas to maximise sales space, while on the top floor there is a demonstration hall that is used for fashion shows and exhibitions.

Mega Khimki

As one of the first regional shopping centres developed in Moscow’s suburbs, this 1.9 million sq ft scheme is owned by Swedish firm Ikea Shopping Centres Russia and was opened in 2004. Situated to the northwest of the Russian capital, it predominantly caters for the everyday Russian shopper, and when Drapers visited it was bustling.

With the Russians’ love of international brands, the mix of retailers here is around 70% foreign and 30% domestic, with many of the UK’s core high street names represented. The biggest of the 221 retailers include the likes of Marks & Spencer, Next, H&M and Zara, although most of these are franchise stores. The Russian retailers found among the global line-up include womenswear retailer Kira Plastinina and value chain TVOE. The two-storey scheme is fully let with 66% of the space occupied by fashion retailers.

Ikea tries to sell its 14 Mega shopping centres to western European brands as providing a “safe platform” for international retailers to take their first steps into Russia, and a number have done exactly that this year including US women’s young fashion business Forever 21, Inditex’s women’s fast-fashion brand Lefties, and Mango’s plus-size womenswear concept Violeta. Walking around the Khimki mall it did instil the feeling that it would be a safe place to enter Russia, in part because out of all the schemes visited this one appears most similar to western shopping centres, providing a mix of large stores with clean and modern public spaces.

As with its other Mega schemes, Khimki is anchored by an Ikea store and hypermarket, and last year had 36 million visitors. Ikea is now working on plans to refurbish the centre in 2016 and extend
it by a further 750,000 sq ft in 2017.


This department store, part of Russian luxury retail business Mercury Group, opened next door to the Bolshoi Theatre in 1908. It clearly demonstrates the luxury offer available in Moscow, but unlike at GUM, shoppers - both Russians and tourists - leave clutching numerous heavily laden bags.

Last refurbished in 2007, the 600,000 sq ft store is modern and clearly laid out with a vast designer clothing section split over three floors offering international brands like Alexander McQueen, Burberry and Prada, and a huge footwear section. Each floor has a distinct feel, with the core menswear and womenswear floors bright and spacious, and lavish fit-outs in each concession, while on the young fashion floor the mood instantly switches to reflect the target audience, with worn wooden flooring and clothing displayed in metal cages.

The store also offers the TsUM Globus Gourmet food area, a cigar room and a Veuve Clicquot champagne bar.

The central atrium, spanning the building’s full six storeys, encompasses 12 dramatic chandeliers hanging on twisted ropes. Every floor has video screens displaying catwalks and fashion shoots.

Okhotny Ryad

Despite its location in the heart of the tourist district, this underground shopping centre northeast of the Kremlin targets domestic consumers and was packed full of shoppers.

Entering the 675,000 sq ft scheme, which was one of the first Russian malls when it opened in 1997, shoppers walk downstairs onto the highest floor of the three-storey mall. Every level is fitted out differently with the top floor displaying a bright, shiny gold roof, while lower floors opt for more classical marble décor.

The mall is wholly underground, but it does have a large central atrium with a striking light well that protrudes into the green public square above, and is decorated with a stained glass window depicting a world map. But despite this light shaft, the scheme has low ceilings and feels cramped, as much of the public space is taken up with extra jewellery and food stalls, while illuminated red and blue advertising boards constantly flash to attract attention.

International brands dominate the 100-store line-up, with names such as Zara, River Island and Karen Millen alongside Russian retailers like womenswear brands Love Republic and InCity. The scheme has embraced technology, with interactive store guide screens on every floor to help shoppers find what they are looking for.

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