At the start of 2022, many foreign brands paused operations in Russia and ultimately pulled out of the market. More than a year has passed since then, and it is possible to draw several conclusions from the experience. Are there clear answers to the big questions?
The situation stands out as truly unique, even compared with the pandemic era, which affected markets in its own way. The core distinction is that several brands exited entirely and closed all direct channels. This level of withdrawal has not been seen in such large numbers before, and almost all brands that left the market previously maintained a strong offline presence.
The decline in offline sales was driven by two intertwined factors: brand departures and an unstable economy. Offline retail, which accounted for about 70–75 percent of the fashion market, experienced a pronounced drop, while online platforms continued to grow, led by the major players. In parallel, online channels gained momentum even as physical stores contracted.
Another notable development this year is the rarity of brands closing direct channels and stepping away from partner networks like marketplaces. Some large brands no longer sell directly in Russia but continued to sell via marketplaces. This dynamic accelerated the shift toward online sales, with the number of new businesses on marketplaces such as Avito rising by 50–60 percent.
There is widespread discussion about Iranian and Turkish brands entering the Russian market. Yet the typical European consumer preferences in Russia differ considerably from those in these countries. This raises questions about how well these brands can sustain a presence. It is not just trends but also consumption culture, business practices, product variety, and stylistic preferences that vary. Even within Asia and the Middle East, differences abound. China, being a major producer for many goods in this market, shows similarities with Russia that exceed those of Persian Gulf countries. Nevertheless, the Russian market remains more aligned with Western patterns, and the brand composition reflects relatively few Asian brands. Long-term integration of eastern brands remains uncertain, but is not impossible with adaptation and strategic focus.
Much depends on what brands want to achieve and how they adapt their capabilities. Even Western brands that initially entered the Russian market required time to adjust.
When it comes to speeding up adaptation for foreign brands, the approach often centers on localizing the collection. Russia is a market where collections must be adapted to local preferences, even for Western brands that feel closer to the culture in Russia. In regions with larger stylistic or climatic differences, the degree of localization should be greater. Profitability and the ability to operate at scale are central concerns for brands and their retailers.
For example, Turkish brands can integrate more quickly thanks to closer familiarity with the Russian market. Turkish Colin’s has operated in Russia since the 1990s, illustrating how proximity and long-standing presence aid adaptation. For brands from Iran and other regions, full integration may be slower and more challenging.
The main trends in localizing Western clothing for Russian consumers include a demand-driven approach, especially in fast fashion. Retailers showcase a broad assortment and observe what sells, then promptly respond with in-demand items or variations while removing underperformers. Consideration of country-specific stylistic differences is essential because fashion in Moscow, Istanbul, and Shanghai feels distinct. Climate plays a role too, shaping product variety and materials. Natural fabrics hold strong appeal for Russian buyers, and many see winter sweaters made from artificial wool as unattractive. Generational shifts are underway, with styles popular in the 2000s and 2010s gradually fading away.
Following the departure of foreign brands, the resale market has been a focal point of discussion. The trend is expected to endure for the long term. For the Zoomer generation, resale is becoming the norm, and this force is likely to influence future commerce as new cohorts enter the market. Forecasts suggest that resale will grow over the next decade and that this segment could become one of the leading components of the sales landscape. Avito data indicate that purchases in the resale sector have doubled in the last year, and new users tend to remain active during economic shifts.
For many buyers, resale carries concerns about authenticity. Avito has implemented a proactive stance against counterfeit products, blocking ads that claim fakes exist. Brand lists of counterfeit items are shared with Avito, and the platform removes them. While proactive efforts help, it is challenging to eliminate the problem completely, since new accounts and names can appear after blocks. This remains an ongoing challenge for the market.
Avito operates an authentication service to counter counterfeit goods. This service is available to brand vendors and is conducted through a trusted partner with expertise in fashion verification. Independent experts assess products from photos, and once verification succeeds, the ad earns an Original badge. Photo requirements vary by product, such as specific angles for sneakers or handbags that include serial numbers and accessories.
The two most popular categories in the second-hand market are outerwear and shoes. In the premium segment, resale tends to be more common due to the higher longevity and value of items. Bags also perform well in resale, though their volume is smaller relative to outerwear and shoes. Overall, almost any product type can be suitable for resale, provided buyers have realistic expectations about condition and prior use.
Attribution: industry insights and market observations from Avito and participating partners. Research and market perspectives are compiled from industry reports and stakeholder interviews to illustrate evolving consumer behavior and channel dynamics in Russia and neighboring markets [Citation: Avito market analytics, 2024].