When times are hard, product selection and prices become more important

In Q1 2015 consumer confidence dropped further in Russia: it was at 72 points (Q3 2014: 87 points, Q4 2014: 79 points). At the end of last year the rouble’s exchange rate worsened considerably and this had a negative influence on consumer mood. Nielsen’s study reveals that one third of Russian consumers had a 20 percent smaller household budget in December 2014 than in August 2014. Many of them also believe that the products they buy got more expensive: 7 out of 10 consumers say in December they paid 19 percent more for the same goods than in August. Every third respondent purchased fewer products than three months earlier and 78 percent switched to cheaper groceries. Many Russians go shopping less often than before and from store types discounters attracted consumers the most in December. Product selection and price are key factors in the Russian market this year. Consumers will probably cut back on their spending in the months to come. 60 percent think prices will rise considerably and 30 percent opine product quality will drop and stores’ product selection will change. The Nielsen study concludes that the present period is suitable for market players to strengthen their brands and product selection.