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Survey shows Zara substitute fails in Russia
(MENAFN) In a notable shift within the Russian retail landscape, the Lebanese clothing brand MAAG, which stepped in to replace Zara after the Spanish conglomerate Inditex decided to exit the Russian market, has encountered a wave of disappointment, according to a survey conducted by the Union of Shopping Centers (STC). The survey findings, reported by RIA Novosti, reveal that MAAG, owned by Dubai-based Fashion And More Management DMCC, has been labeled the "disappointment of the year" by landlords in Russia.
Fashion And More Management DMCC had opened MAAG stores in the former locations of popular Inditex brands such as Zara, Pull & Bear, Stradivarius, and Bershka in May. However, the survey indicates that the new MAAG stores have shown the worst sales results since their opening, eliciting criticism from landlords. STC vice president Pavel Lyulin, citing the survey, pointed to factors such as an insufficient product range, ascetic design, and weak advertising campaigns as contributors to MAAG's underwhelming performance.
The disappointment comes in the aftermath of Zara's departure from the Russian market, part of Inditex's decision to close its stores, including Zara, Bershka, and Massimo Dutti, last year. The conglomerate later opted to exit the Russian market altogether, selling some of its 500-plus Russian stores to a buyer based in the United Arab Emirates.
The changing dynamics in the Russian retail sector have seen new brands from Turkey, China, India, and other "friendly" nations increase their presence in the market, filling the void left by many Western firms that exited due to pressure from Ukraine-related sanctions. However, the struggles faced by MAAG underscore the complexities and challenges involved in successfully replacing well-established and popular international brands, especially in a market as diverse and competitive as Russia.
As MAAG grapples with the fallout from this survey, the incident serves as a cautionary tale for businesses seeking to capitalize on vacated market spaces, emphasizing the importance of understanding local consumer preferences, effective marketing strategies, and a robust product offering to ensure a smooth transition and sustained success.
Fashion And More Management DMCC had opened MAAG stores in the former locations of popular Inditex brands such as Zara, Pull & Bear, Stradivarius, and Bershka in May. However, the survey indicates that the new MAAG stores have shown the worst sales results since their opening, eliciting criticism from landlords. STC vice president Pavel Lyulin, citing the survey, pointed to factors such as an insufficient product range, ascetic design, and weak advertising campaigns as contributors to MAAG's underwhelming performance.
The disappointment comes in the aftermath of Zara's departure from the Russian market, part of Inditex's decision to close its stores, including Zara, Bershka, and Massimo Dutti, last year. The conglomerate later opted to exit the Russian market altogether, selling some of its 500-plus Russian stores to a buyer based in the United Arab Emirates.
The changing dynamics in the Russian retail sector have seen new brands from Turkey, China, India, and other "friendly" nations increase their presence in the market, filling the void left by many Western firms that exited due to pressure from Ukraine-related sanctions. However, the struggles faced by MAAG underscore the complexities and challenges involved in successfully replacing well-established and popular international brands, especially in a market as diverse and competitive as Russia.
As MAAG grapples with the fallout from this survey, the incident serves as a cautionary tale for businesses seeking to capitalize on vacated market spaces, emphasizing the importance of understanding local consumer preferences, effective marketing strategies, and a robust product offering to ensure a smooth transition and sustained success.
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