Food retailing during economic downturn. In what way can marketing strategies be adapted to changing consumer’s behavior? Case study of Russian X5 Retail Group and Swedish the ICA Company

Abstract: Retailing is the considerable element of today economy. This sector was rapidly developing during past years. It was easy to make consumers spend their money because they wanted to spend money. Today consumers are no longer eager to spend as much as before. Therefore retail companies should find new ways to motivate customers to expend. The aim of this research is to define to which extent retailers suffered from economic downturn and to find out which marketing tools they implemented in order to adapt to new market conditions. In order to investigate the variety of possible scenarios, two countries were taken into consideration. Sweden as one of the most stable economies in the world and Russia as country with promising perspectives but unpredictable and risky environment. The goal of taking two countries for the survey was identifying common and diverse traits of changed retailing conditions and necessary measures to follow it. Qualitative method was chosen for current dissertation embodied by case study analysis of leading retail companies in both countries. Primary data from conducted interviews and secondary data from annual reports and statistical authorities were used for analysis. The findings showed that Russian retail was stricken by economic downturn much more than Swedish. Apart from it, customer’s behavior in Sweden did not change significantly as long as Russian consumers changed their store format preferences in favor of discounters. Despite difference revealed in this issues the common characteristics of successful post-recession marketing strategy were discovered. Low price is now the key element of successful retailer. Other elements of marketing strategies play only supportive role in struggle for consumer’s wallets.