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Mobile retail in Russia. Operators’ and independent sales channels

January 2019

Analytical Report (full version)

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Analytical Report (full version)

Mobile retail in Russia. Operators’ and independent sales channels
Mobile retail in Russia. Operators’ and independent sales channels
January 2019

Mobile retail in Russia. Operators’ and independent sales channels

January 2019

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The slowdown in the mobile market has led to the fact that the majority of participants in the Russian mobile retail market have stepped up their efforts to develop new product lines and services that could compensate for the decline in sales in their main segment. At the moment, the market activity of Russian mobile retail networks, in addition to sales of mobile terminals, includes other activities that, according to J'son & Partners Consulting, are able to bring more than half of the gross profit.

 

Key Market Insights upon Mobile Retail Market in Russia

 

In this study J'son & Partners Consulting analyzed the range of products and services provided by five Federal Russian mobile retail networks: multibrand networks – "Euroset" and "Svyaznoy" and operator networks – "MTS", "MegaFon retail" and "Beeline retail network".

 

Multi-brand networks traditionally demonstrate a wider range of products, while the number of product positions in them has increased compared to last year. Retail of mobile operators shows a multidirectional trend – the assortment of MegaFon has grown, and MTS and Beeline have decreased (Pic.1). The difference in the number of commodity items between multi-brands and operator retail is explained by the fact that in operator retail the range of goods that are not directly related to cellular communication is much smaller. In addition, multibrand mobile retail chains offer a much wider range of accessories.

 

The global market of radio frequency identification (RFID) technologies has been demonstrating sustainable development in recent years. Currently, the world operates about 59.5 billion RFID devices. The largest aggregate number of devices (20.55 billion, or about 34.5%) is used in the retail sector. The next most important market segments are smart cards and smart tickets, these devices together account for about 32.8% of the global fleet of RFID devices. Over 1 billion RFID devices are also used in the segments of marking equipment, books, vehicles, logistics, animal husbandry, health care.

 

According to J'son & Partners Consulting, the volume of the Russian market of mobile terminals (smartphones and mobile phones) in real terms in the first three quarters of 2017 amounted to 27.2 million devices. Compared to the first three quarters of 2016, the sales increased by 1.5%. Compared to the pre-crisis period (the first three quarters of 2014) the market volume in 2017 is 11% lower. Thus, the market for mobile terminals is gradually recovering from the crisis, primarily due to the growth of smartphone sales. However, the results are still far from the pre-crisis figures, which indicates, among other things, that the market is approaching the saturation stage.

 

According to the estimates made by J'son & Partners Consulting, in the first 3 quarters of 2017 in Russia, there were sold a quarter fewer tablet PCs than in the same period of 2016. Compared to the pre-crisis period sales in the comparable period decreased by almost two-thirds. The tablet PC market shows a negative trend for 11 consecutive quarters.

 

Operator retail positions are continuing to strengthen. According to J'son & Partners Consulting, the share of operator retail chains increased from 16% in 2010 to 31% in 2016, in total sales of mobile terminals in real terms.

 

Although the market is approaching the saturation stage, according to the forecasts from J'son & Partners Consulting, up to 2021 the market of mobile terminals will continue to grow, while the market of tablet PCs will continue to decline.

 

In the commodity segment of modems, routers, and wearable gadgets, the general trend of narrowing the range in operator sales points and its expansion in multi-brand retail remains.

 

In other product segments (computers, photo equipment, accessories) operator retail has a very limited range compared to the stores of multi-brand networks.  

 

Talking about services provided in the salons, operator networks maintain parity with multi-brand networks, both in terms of the set of segments and their content in terms of the number of partners and their diversity, this can be seen, for example, in the segment of receiving payments (Table.1). The only exception is the sale of air and rail tickets, which is not conducted at operator sales points.

 

Scenarios of the Russian mobile retail development

 

According to forecasts of J'son & Partners Consulting, the share of operator retail will continue to grow, and by 2020 will exceed 50% of total sales of mobile terminals in Russia.

 

According to J'son & Partners Consulting, the strengthening of operators' positions in the mobile retail market can have a significant impact on the existing market structure. Mobile operators are attractive partners for vendors because they have significant financial and marketing resources.

 

But J'son & Partners Consulting reckons that even if the situation develops according to a similar scenario, the Russian market will still be a place for independent retail, both for large companies and for small players: the presence of large independent networks allows manufacturers to increase their sales.

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This information note was prepared by the J'son & Partners Consulting. We work hard to provide factual and prognostic data that fully reflect the situation and available at the time of release. J'son & Partners Consulting reserves the right to revise the data after publication of new official information by individual players. 

 

Copyright © 2018, J'son & Partners Consulting. The media can use the text, graphics, and data contained in this market review only using a link to the source of information - J'son & Partners Consulting or with an active link to the JSON.TV portal

 

™ J'son & Partners [registered trademark] 

 

 

Detailed results of the study are presented in the full version of the report:

 

Mobile retail in Russia. Operators’ and independent sales channel

 

Contents

  1. Summary  
  2. Introduction  
  3. Features of assortment policy of the Russian mobile retail in operator and independent networks

3.1.              Product matrix overview 

3.1.1.   Smartphones 

3.1.2.   Mobile phone 

3.1.3.   Tablet PCs 

3.1.4.   Modems and routers 

3.1.5.   Wearable gadgets 

3.1.6.   Computer equipment 

3.1.7.   Photo and video equipment  

3.1.8.   Accessories

3.1.8.1.      Accessories for mobile devices 

3.1.8.2.      Accessories for computer equipment 

3.1.8.3.      Accessories for photo and video equipment 

3.1.9.   More

3.1.9.1.      Euroset 

3.1.9.2.      Svyaznoy

3.1.9.3.      Beeline 

3.1.9.4.      MegaFon

3.2.              Service matrix overview 

3.2.1.   Sale/execution of operator contracts

3.2.1.1.      Euroset  

3.2.1.2.      Svyaznoy

3.2.1.3.      Operator retail networks 

3.2.2.   Money transfer 

3.2.3.   Payment reception

3.2.4.   Sale of air and railway tickets 

3.2.5.   Credits 

3.2.6.   Sale of tickets for entertainment events 

3.2.7.   Equipment setting

3.2.8.   Insurance services 

3.2.9.   Extended warranty registration  

3.2.10.                More 

3.2.10.1.   Operator retail networks  

3.2.10.2.   Euroset

3.2.10.3.   Svyaznoy 

  1. The Russian market of mobile devices, key figures 

4.1.              The Russian market of mobile phones and smartphones

4.1.1.   Volume of the market of mobile phones and smartphones in real and monetary terms, 2013 - 2Q 2016 (in quarterly dynamics) 

4.1.2.   Structure of the market of smartphones by operating systems, 2013 – Q2 2016 (quarterly dynamics)

4.1.3.   Structure of the market of smartphones by manufacturers, 2013 – 2Q 2016 (quarterly dynamics)  

4.2.              The Russian tablet PC market

4.2.1.   Volume of tablet PCs in physical and monetary terms, 2013 - 2Q 2016 (quarterly dynamics)

4.2.2.   Structure of the market of tablet PCs by operating system, 2013 – Q2 2016 (quarterly dynamics)

4.2.3.   Structure of the market of tablet PCs by manufacturers, 2013 – Q2 2016 (quarterly dynamics)

  1. The Russian market of mobile terminals by operator and independent sales channels 
  2. Scenarios of the mobile retail market development in Russia 
  3. Forecasts and trends, 2016-2020

7.1.Forecast for the market of mobile terminals in natural terms, 2016-2020 

7.2.Forecast for the market of mobile terminals in monetary terms, 2016-2020 

7.3.Forecast for the smartphone market in natural terms, 2016-2020 

7.4.Forecast for the smartphone market in monetary terms, 2016-2020 

7.5.Forecast for the tablet PC market in real terms, 2016-2020 

7.6.Forecast for the tablet PC market in monetary terms, 2016-2020

  1. Key conclusions

 

List of pictures 

Pic. 1. Number of product items presented in Russian mobile retail chains, pieces, November 2017

Pic. 2. Number of product items presented in Russian mobile retail chains, pieces, November 2017

Pic. 3. Number of items of smartphones in Russian mobile retail chains, pieces, November 2017

Pic. 4. Assortment base of smartphones in Russian mobile retail chains by price segments,%, November 2017

Pic. 5. Number of smartphones in every price segment in Russian mobile retail chains, pieces, November 2017

Pic. 6. Number of mobile phones presented in Russian mobile retail chains, pieces, November 2017

Pic. 7. Assortment base of mobile phones in Russian mobile retail chains by price segments, %, November 2017

Pic. 8. Number of items of mobile phones in each price segment in Russian mobile retail chains, pieces, November 2017

Pic. 9. Number of items of tablet PCs presented in Russian mobile retail chains, pieces, the November 2017

Pic. 10. Assortment base of tablet PCs in Russian mobile retail chains by price segments,%, November 2017

Pic. 11. Number of items of tablet PCs in each price segment of Russian mobile retail chains, pieces, November 2017

Pic. 12. Number of items of modems and routers presented in Russian mobile retail chains, pieces, November 2017

Pic. 13. Assortment base of modems and routers in Russian mobile retail chains by price segments,%, November 2017

Pic. 14. Number of items of modems and routers in each price segment in Russian mobile retail chains, pieces, November 2017

Pic. 15. Number of items of wearable devices presented in Russian mobile retail chains, pieces, November 2017

Pic. 16. Assortment base of wearable devices in Russian mobile retail chains by price segments,%, November 2017

Pic. 17. Number of wearable devices in each price segment in Russian mobile retail chains, pieces, November 2017

Pic. 18. Number of items of computer equipment presented in Russian mobile retail chains, pieces, November 2017

Pic. 19. Assortment base of computer equipment in Russian mobile retail chains by price segments,%, November 2017

Pic. 20. Number of items of computer equipment in each price segment of Russian mobile retail chains, pieces, November 2017

Pic. 21. Number of items of photographic and video equipment presented in Russian mobile retail chains, pieces, November 2017

Pic. 22. Assortment base of photo and video equipment in Russian mobile retail chains by price segments,%, November 2017

Pic. 23. Number of items of photographic and video equipment in every price segment in Russian mobile retail chains, pieces, the November 2017

Pic. 24. Number of items of accessories for mobile devices in Russian mobile retail chains, pieces, November 2017

Pic. 25. Number of items of accessories for mobile devices in Russian mobile retail chains by network, pieces, November 2017

Pic. 26. Number of items of accessories for computer equipment in Russian mobile retail chains, pieces, November 2017

Pic. 27. Number of items of accessories for computer equipment in Russian mobile retail chains by network, pieces, November 2017

Pic. 28. Number of items of accessories for photo and video equipment in Russian mobile retail chains, pieces, November 2017

Pic. 29. Number of items of accessories for photo and video equipment in Russian mobile retail by network, pieces, Nov 2017

Pic. 30. Number of other product items in Russian mobile retail chains, pieces, November 2017

Pic. 31. Number of other product items in Euroset stores, pieces, November 2017

Pic. 32. Number of other product items in Svyaznoy stores, pieces, November 2017

Pic. 33. Number of other product items in MTS stores, pieces, November 2017

Pic. 34. Number of other product items in Beeline stores, pieces, November 2017

Pic. 35. Number of other product items in MegaFon stores, pieces, November 2017

Pic. 36. Market volume of mobile terminals in real terms, million units, 2014 - 3Q 2017

Pic. 37. Volume of the market of mobile terminals in monetary terms, million units, 2014 - 3Q 2017

Pic. 38. Volume of the smartphone market in real terms, million units, 2014 - Q3 2017

Pic. 39. Volume of the smartphone market in monetary terms, million units, 2014 - Q3 2017

Pic. 40. Structure of the smartphone market by operational systems, % of sales in natural terms, in 2014 – Q3 2017

Pic. 41. Structure of the smartphone market by manufacturers, % of sales in natural terms, in 2014 – Q3 2017

Pic. 42. Volume of the tablet PC market in real terms, million units, 2014 - 3Q 2017

Pic. 43. Volume of the tablet PC market in monetary terms, million units, 2014 - 3Q 2017

Pic. 44. Structure of the market of tablets by operational systems, % of sales in natural terms, in 2014 – Q3 2017

Pic. 45. Structure of the market of tablets by manufacturers, % from sales in physical terms, 2016 – Q3 2017

Pic. 46. Share of operator retail in the Russian market of mobile terminals (sales in real terms), 2010-Q1-Q3 2017

Pic. 47. Share of operator retail in the Russian market of mobile terminals (sales in real terms), 2015-2021*

Pic. 48. Domestic e-commerce market volume, billion rubles, Russia, 2013-2017

Pic. 49. Forecast of the market of mobile terminals in natural terms, million units, 2016 – 2021

Pic. 50. Forecast of the market of mobile terminals in monetary terms, million units, 2017 – 2021

Pic. 51. Forecast of the smartphone market in real terms, million units, 2016-2021

Pic. 52. Forecast of the smartphone market in monetary terms, million units, 2016-2021

Pic. 53. Forecast of the tablet PC market in real terms, million units, 2016-2021

Pic. 54. Forecast of the tablet PC market in monetary terms, million units, 2016-2021

 

List of tables

Table 1. Classification of goods and services of Russian mobile retail networks

Table 2. Number of product items in the range of Russian mobile retail chains by category, November 2017, pieces.

Table 3. Minimum and maximum cost of a smartphone in Russian mobile retail networks, rubles, November 2017

Table 4. Minimum and maximum cost of a mobile phone in Russian mobile retail networks, rubles, November 2017

Table 5. Minimum and maximum cost of a tablet PC in Russian mobile retail networks, rubles, November 2017

Table 6. Minimum and maximum cost of modems and routers in Russian mobile retail networks, rubles, November 2017

Table 7. Minimum and maximum cost of wearable devices in mobile retail, rubles, November 2017

Table 8. Minimum and maximum cost of computer equipment in Russian mobile retail networks, rubles, November 2017

Table 9. Minimum and maximum cost of cameras in mobile retail, rubles, November 2017

Table 10. Prices and number of tariff plans and SIM-cards in the Euroset mobile retail network, November 2017

Table 11. Prices and number of tariff plans and SIM-cards in operator mobile retail networks, November 2017*

Table 12. Reception of payments in mobile retail* November 2017

Table 13. Air and railway tickets in mobile retail,November 2017

Table 14. Partner banks issuing loans in Russian mobile retail networks, November 2017

Table 15. Service equipment settings in Russian mobile retail networks, November 2017

Table 16. Insurance services in Russian mobile retail networks, November 2017

Table 17. Maps of mobile retail operator networks, November 2017

Table 18. Other services of the Euroset mobile retail network, November 2017.