”Azbuka Vkusa” chooses to refocus on lower-end of the market

Gourmet supermarket operator ‘Azbuka Vkusa’ is launching a new network called ‘AB Market’, competing in price with ‘Auchan’. The retailer has stated that the premium market segment is small, and all customers are saving money. According to research in November by ‘Romir’, the number of Russians economizing on their favourite foods has doubled.

The first two stores under the ‘AB Market’ brand opened in late November in Odintsovo and Stupino. “These stores will work with customers who would never consider Azbuka Vkusa or who visit our premium brand only occasionally. We decided to focus our stores on families who do the weekly shop in one place, bringing with them their families” - Andrey Golubkov, a representative of RBK explained.

‘AB Market’ will be styled differently: shops will resemble markets stalls, and you will even be able to bargain with sellers, depending on the amount you buy. The new markets will have an area of around 2000 square meters, and include around 18-25,000 individual items, of which over 50% will consist of fresh fruits and vegetables. 15% of items will be non-food. The new outlets will be located near roads and residential areas.

The average bill in ‘AB Market’ is likely to be more than twice lower than that in Azbuka Vkusa – around 800 Roubles compared with 1500 Roubles. Priority will be given to Russian-produced goods.

"However, although the economy may be falling, the premium segment is suffering much less" - contends Vitaly Vavilov, a Partner at Strategy Partners Group. The share of food in the average Muscovite’s expenses in around 20%, though for rich people around 10-15%, so the savings made will not account to much.


© Strategy Partners Group, 1994-2021