Russia’s Watcom shopping index, which measures the number of shoppers in the largest malls in the country caught up some lost ground in November, but remains at its lowest level in four years, Intellinews reports.
The index keeps track of footfall in Moscow’s biggest malls using face recognition technology and the mall’s security cameras.
It recorded a value of 503 in week 50 of 2018, the second highest value all year after 519 in week 10, but still below week 50s in previous years (564 in 2014, 560 in 2015, 524 in 2016 and 512 in 2017).
The volume of foot traffic in Moscow’s malls has been falling steadily in each of the last four years since the index was launched. While some of this is due to a squeeze in real income, which fell for the fifth year in a row in 2018, the reduction has also been driven by a migration of shopping to online retailers as e-commerce booms.
Real disposable income of Russians (revenues minus utility payments adjusted for inflation) in November 2018 decreased by 2.9% in annual terms, after rising by 0.3% in October, decreasing by 3.2% in September and again by 1.6% in August.
At the same time, the volume of online sales is expected to have increased again in 2018 to $21.5 billion, up from $14.9 billion in 2017, and the rate of expansion of e-commerce shows no sign of slowing down, according to research by Data Insight.
The agency’s forecasts imply a gradual slowdown in the growth of the Russian domestic e-commerce market (after the 20-21% y/y rise in 2017), although it still remains robust,” VTB Capital commented on December 18.
Several big online retail platforms that were being tested in 2018 are expected to develop rapidly in 2019, so another big jump in the online retail segment is expected, analysts say.