The top three DIY networks in Russia in terms of revenue have remained unchanged for many years. These positions were firmly occupied by international networks. However, the St. Petersburg chain Petrovich in 2016-2017 displaced first Castorama from third place, and then OBI from second place, the INFOLine study notes.

The head of Petrovich, Evgeniy Movchan, does not hide his ambitious plans and says that “perhaps someday we will catch up with Leroy Merlin.” However, although market participants admit that Petrovich’s team is great professionals, they will not be able to catch up with the leader, the gap between the first and second players is too large - 225 billion rubles versus 37.8 billion rubles. In addition, the pace of development of Leroy Merlin in recent years has been higher than that of its competitors in the top 10, so the gap has only increased and, taking into account the grandiose plans of the French chain, will continue to grow.

One of the key trends in the DIY market is ongoing consolidation. In February of this year, Leroy Merlin closed the deal to purchase the Finnish chain K-rauta, after which its share in the Russian market increased to 19%, notes the INFOLine study “DIY Market of the Russian Federation. Results of 2017. Trends of 2018. Forecast to 2020 of the year" . The DIY&Household segment in 2017 grew by 1.8% against a decrease of 6% in 2016 and approached 1.4 trillion rubles, and taking into account sales in the small wholesale channel exceeded 2 trillion rubles. In addition, the bankrupt Stroydepo hypermarket chain (one of the top 30 DIY chains in Russia) left the market.

1. French chain Leroy Merlin, operating in Russia since 2004, for many years it has held the first place in Russia in terms of revenue among DIY networks in Russia. During 2012-2017, the network, according to INFOLine estimates, annually increased revenue by more than 20%.

By 2024, the retailer plans to almost triple its network in Russia: from the current 78 to more than 200 stores

In February of this year, Leroy Merlin closed the deal to purchase the Finnish chain K-rauta, after which its share increased to 19%. Plans for this year include opening 20 stores: in Moscow, the Moscow region and in 10 new regions for the chain. This year, the DIY retailer opened online stores in all cities where the chain stores operate. Before that, they worked only in Moscow, St. Petersburg, Samara, Rostov-on-Don and Novosibirsk. The market leader also plans to double the share of e-commerce from the current 0.75%, including by increasing the number of product items on the site by approximately 10 times. In addition, in June, the chain opened a marketplace on its website - an online platform with goods from third-party sellers. Market participants assessed this as a major event on the Russian DIY market.

2. St. Petersburg STD "Petrovich" at the end of 2017, it took second place in the ranking of the largest construction networks in Russia. At the end of last year, the company had 19 construction bases with a total area of ​​99 thousand m 2 located in the Northwestern and Central Federal Districts. Revenue from online trading last year exceeded 11 billion rubles (29% of the total sales structure).

“In the coming years, Leroy Merlin will move Petrovich forward in terms of the share of online trading in the total turnover of the network. And first of all, because its network is much wider - from Kaliningrad to Khabarovsk, unlike Petrovich, which is represented only in Moscow and St. Petersburg,” says Ivan Fedyakov, general director of INFOLine news agency. Petrovich itself relies on innovation.

Your only path to success is to create demand, anticipate and create the future

"If you are small, like Petrovich, relying on your own strength and profit as the only source of further development of innovation, then your only path to success is to create demand, foresee and create the future. If you just follow someone, then they will crush you and devour you. And, in fact, innovation is our road to the future,” said the company’s CEO Evgeny Movchan at Russian Retail Week 2017, emphasizing that the company is constantly trying to create offers that are completely different from what DIY hypermarkets offer.

For example, a retailer installed tablets in sales areas, thanks to which customers can not only find out information about a product, but also collect a shopping cart. Moreover, heavy purchases do not have to be picked up in the hall and carried to the checkout in a cart; they can be picked up after making a purchase when leaving the construction site or ordered home delivery. In addition, Petrovich’s specialty is the fastest delivery of goods to the client: 2 hours in St. Petersburg and 5 hours in Moscow, where the company entered 3 years ago. “We definitely understand that we can achieve St. Petersburg standards in the capital. And we see that other players are also trying to deliver faster, because for the buyer time is one of the most important needs,” says Evgeniy Movchan. The planned turnover of STD "Petrovich" at the end of 2018 is 45.5 billion rubles. At the end of last year, the company occupied 3.2% of the retail market for home and renovation materials.

3. German OBI network, operating in Russia since 2003, moved from second to third place in the ranking at the end of 2017 with a turnover of 36 billion rubles. Moreover, the retailer has been showing negative revenue growth rates for the last 3 years. By 2020, the German retailer plans to update all hypermarkets in Russia. Currently, there are 28 OBI hypermarkets in Russia in 14 cities. According to INFOLine calculations, the share of OBI from 2015 to 2017 decreased from 3.2 to 3%.

4. Castorama, part of the international company Kingfisher (developing five DIY networks in the world), has been operating on the Russian market since 2006. Currently there are 21 hypermarkets in Russia. Over the past 6 years, the company has opened only four hypermarkets in Russia and closed one. The network's share decreased from 3.2% in 2015 to 3% in 2017.

5. St. Petersburg group of companies "Saturn", which develops hypermarkets under the SaturnStroyMarket brand, occupies 5th place in the ranking of the largest DIY chains in Russia. The company has 48 facilities in 25 cities of Russia and occupies 2.3% of the country's market.

6. In 6th place is the St. Petersburg player “Maxidom”, operating since 1997. Today the network includes 14 hypermarkets with a total area of ​​more than 130 thousand m2 in six cities: St. Petersburg, Nizhny Novgorod, Kazan, Yekaterinburg, Samara and Ufa. This year the company announced that it plans to develop new small formats - up to 4 thousand m 2. Operating hypermarkets have an area of ​​10-12 thousand m2.

7. Kaliningrad Group of Companies "Baucenter" has been operating since 1994. Today it has eight hypermarkets in Kaliningrad, Omsk, Novorossiysk and Krasnodar. This year the network announced plans to enter the Moscow region. Three hypermarkets are planned to open here in the next few years.

8. Moscow chain of stores “Stroitelny Dvor” has been working in Russia since 1993. Today it has 57 stores in 14 cities of Russia.

9. Ninth place was occupied by the Finnish network “K-rauta”, part of the Kesko concern. At the beginning of this year, the Finnish concern sold this chain to Leroy Merlin. “Kesko is ceasing trading operations in Russia and selling its 12 chain stores,” the company said in a statement. The transaction amount was 12 billion rubles. All 12 K-raut stores were transferred to Leroy Merlin in the first half of 2018.

10. Kazan company "Agava" develops the Megastroy hypermarket chain. Today it has 12 hypermarkets, four of which are located in Kazan, two in Naberezhnye Chelny, two in Ulyanovsk and one each in Cheboksary, Yoshkar-Ola, Sterlitamak and Saransk. Its turnover in 2017 increased to 11.5 billion rubles from 10.2 billion in 2016.

Marketing and trade economics

Shop building. Construction of shopping centers, expansion of networks

The retail market for construction and finishing materials, home and garden goods at the beginning of 2017 showed a record decline. According to a new study by INFOLine “Russian DIY Market. Results of 2016. Trends 2017. Forecast until 2019” the reduction was 6%.

STM

Omnichannel

Source: data from INFOLine news agency

QuantitySKUDIYat the beginning of 2017

Source: company data

According to INFOLine analysts, retailers developing their own brands have more flexible options for managing their own margins and price positioning. They are less dependent on imports and can themselves determine production and delivery cycles, pricing and a set of marketing tools for promoting private labels.

Thus, in 2017, the main trends that have developed in the Russian DIY market relate primarily to changes in the strategies of retail chains towards the most effective building of relationships with consumers. For further successful development, retail chains have to take into account not only the current economic situation, but also meet the requirements of the modern consumer in choosing a way to make purchases.

The material was prepared according to the INFOLine study “DIY Market in Russia. Results of 2016. Trends for 2017. Forecast until 2019"

Main trends in the development of the Russian DIY market in 2017

The largest operators of the DIY market noted that due to a decrease in real income, Russian consumers have become more sensitive to prices: they more often compare the cost of goods in online and offline stores, and make home renovations in parts.

As a result, consumer demand has shifted from the middle and high price segments towards inexpensive branded goods and private labels, which led to a revision of the assortment and pricing policy of a number of retail chains. This, in turn, creates new trends in the Russian DIY market and strengthens existing ones.

Omnichannel

The Russian DIY market is developing under the influence of factors and trends characteristic of the economy as a whole and modern retail formats, as well as under the influence of industry-specific features. In 2017, the trend of retail chains building a business model that implies the effective integration of online and offline channels of interaction with customers continued.

According to INFOLine research, online sales in the DIY & Household and furniture segments in rubles grew by more than 27% and approached 108 billion rubles.

According to INFOLine, at the beginning of 2017, more than 200 universal DIY networks in Russia were developing an online sales channel.

Dynamics of online sales in the DIY segment (Hard and Soft DIY, Household, Garden, furniture) (retail and small wholesale) in Russia in 2009-2016.

Source: data from INFOLine news agency

The largest DIY retailers developed online sales most dynamically in 2016 and continue to do so in 2017. The position of the leader in the online trading market among universal and specialized DIY retail chains was strengthened by the retail chain STD Petrovich - at the end of last year, the retailer has already increased online sales by more than 34%.

The leader of the INFOLine DIY rating site ssia TOP retail chain Leroy Merlin over the past year has expanded its online catalog to 38 thousand SKUs, which fully covers the assortment of hypermarkets, while online ordering is available for more than 85% of the goods offered in the catalog.

Some of the largest DIY chains marked the opening of their own online stores in 2016. One of these networks was K-rauta, which immediately led to an increase in traffic to the store’s website several times. Also, on December 1, 2016, a full-fledged online store of one of the leaders in the Household segment of the Domovoy retail chain was launched.

Rotation of the assortment and replacement with Russian-made goods

As INFOLine data show, annual rotation of assortment at the largest DIY retail chains ranges from 20 to 30%, and in 2017 this trend continued. Many Russian retailers cannot compete with international players and are forced to replace part of their assortment with household goods.

As part of the preparation of the study, INFOLine specialists analyzed the assortment matrix of the 50 largest DIY chains. This analysis showed that almost half of the players expanded their assortment specifically due to goods for the home and garden. Retail chains such as Domovoy and Tvoy Dom are gradually introducing a DIY range, increasing the number of Household items.

The recent devaluation of the ruble has created another important trend in the Russian DIY market - retail chains have moved to increase the share of Russian-made goods in their assortment.

Thus, by 2017, the assortment of the K-Rauta retail chain already consisted of 45% Russian goods. And the Leroy Merlin chain already has more than 50% of Russian-made goods, and by 2021 the company plans to increase this figure to 80%.

As INFOLine experts note, this desire for import substitution will allow DIY retailers to optimize their pricing policy and reduce dependence on currency fluctuations.

New pricing strategies for DIY retail chains

Against the backdrop of a decline in the purchasing power of Russians, one of the decisive factors when choosing a number of categories of goods was their price. Thanks to assortment rotation, DIY retail chains in 2017 continue to increase the share of low-price segment goods, developing loyalty programs and significantly increasing promotional activity and conducting aggressive sales. In addition, since last year, the largest DIY retailers have increased price competition, which is supported by active advertising campaigns.

As INFOLine experts note, this behavior of market players is largely due to the fact that in 2016-2017 there was a decrease in demand for goods in the middle price segment.

Retail chains are continuously searching for suppliers in the regions where they operate to optimize logistics costs and maintain low prices without loss of quality. At the same time, DIY retailers continue to actively develop their own brands. As these studies show, private label allows retailers to increase the margins of certain product categories and reduces risks from external manufacturers.

The leader in the development of private labels is the Leroy Merlin retail chain, which has 16 own brands in its Russian assortment, under which more than 5 thousand SKUs are produced.

QuantitySKUand the share of private label in the revenue of some of the largest networksDIYat the beginning of 2017

In recent years, many companies are increasingly looking for new ways of development and trying to improve the efficiency of their business in harsh market conditions. The DIY retail format is gaining relative popularity, which gives customers the right to “independent behavior” on the sales floor and direct access to the product, which allows them to attract more customers to their store and, in some cases, increase sales.

DIY- is an abbreviation for “Do it Yourself” and translated into Russian means “Do it yourself.” Initially, the DIY category included all types of activities that a person did on his own - for example, making furniture with his own hands or some kind of interior design elements.

Today, the DIY retail market (Do it Yourself) is considered one of the most promising markets. International networks invest billions here in our country alone. The most common format here are super- and hypermarkets with a wide range of construction products - from dry mixes and paints to plumbing fixtures and various home items and decorations, which allow any buyer to carry out repairs

Marketing agency Paper Planes has identified 4 main trends in the DIY retail market that are occurring today. Let's take a closer look at them.

1. Development of own brands (private brands)

The economic crisis greatly changed the opportunities and preferences of buyers, who began to switch to cheaper goods. The “price-quality” indicator came to the fore. Retailers are adapting to this trend by offering cheaper private label products. Private label allows you to increase the margins of certain categories of goods and reduces risks from external manufacturers. But this will be beneficial for those goods for which price comes to the fore. In other cases, customers still value brands and product quality, such as when choosing paint, tools or sealing materials.

2. Personalize the customer journey

Due to the reduction in the flow of customers, for the need to retain them and to form their own consumption culture, retail chains are trying to adapt to each specific client. They are introducing new services that are designed for both retail customers and the business segment. For example, ordinary buyers can be helped with moving, evaluate the planned project, and also carry out various promotions and introduce a system of discounts. Master classes, lectures, seminars and exhibitions are organized for women. For B2B clients, extended working hours are introduced, cutting and cutting of various materials are carried out, and professional consultants are provided. Increasingly, retailers are trying to choose a formula for each specific Client. Offering new opportunities, more and more chains are opening online stores.

3. Narrowly profiled offer

Buyers, in an attempt to save time, look for sellers who can quickly offer them only what they ask for. Therefore, retail chains divide their assortment, offering both highly specialized retail for B2B clients and a narrow assortment for B2C, thus covering and providing customers of all categories.

4. Convergence online and offline

Many stores, trying to reduce their costs, deliberately abandon the “store-warehouse” format. This method is being replaced by new business models where you can place an order online or by phone and immediately receive it in a warehouse or on site. Some chains simply install online terminals in product aisles, where you can place and pay for an order, and you can pick it up at the exit of the warehouse or through the delivery system.

In our humble opinion - the view of a company that has lost hundreds of thousands of rubles due to the bankruptcy of DIY retailers, the trends of survival, and for many DIY chains this is precisely a matter of survival, is the convergence of formats - the expansion of retail due to aggressive wholesale, and wholesale due to aggressive retail. Plus a total rethinking of the service - from logistics to construction services with active sales (the experience of the Abada company can be considered successful here).

A modern network must take on all of the above. And in the future, it will become an ecosystem similar to AppStore, Uber and others - for customers and contractors in their region. The closest thing to construction is the experience of the Remontnik.ru portal, which forms an ecosystem from the service side, not the product side.

The capacity of the retail market for construction and finishing materials in Russia in 2015 exceeded 1 trillion rubles (including VAT), and the total capacity of the DIY, Household (household goods) and Garden (garden goods) market exceeded 1.4 trillion rubles, experts calculated INFOLine in the annual study “Russian DIY Market”. If we take into account sales in the small wholesale channel, the total market volume exceeds 2 trillion rubles (including VAT). In total, there are about 1,000 universal and specialized DIY networks on the market, with the share of modern trade formats exceeding 75%, and on the TOP ‑ The 10 largest DIY retailers account for over 23% of the market.

In 2015, the wholesale and retail market of construction and finishing materials in Russia in monetary terms decreased by almost 5%, despite an increase in prices due to the devaluation of the ruble, and sales in the Hard DIY segment (building materials) decreased due to the investment pause in the construction industry by 16%, while the Soft DIY segment (finishing materials) stagnated. In 2016, in the context of declining real incomes and changes in the structure of consumer spending, the physical volume of sales of construction and finishing materials will continue to decline, and inflation processes due to the stabilization of the ruble exchange rate at a level not exceeding 75 rubles per dollar will slow down significantly.

In 2016, the reorientation of buyers in the middle price segment to cheaper goods will continue, and the key driver for increasing retailers’ revenue will be multi-channel sales, assortment expansion and the development of wholesale sales as a response to the trend of increasing the share of furnished housing sales. Increasing competition in the market and the intensification of organic growth and regional expansion of market leader Leroy Merlin lead to the fact that Russian retailers are faced with a decrease in traffic and a deterioration in their financial condition due to a high level of debt burden and a lack of working capital. In the b2b segment, the rate of decline in demand will slow down in 2016, market consolidation will continue, and the key trend will be the active expansion of retail chains in the wholesale supply segment against the backdrop of declining competitiveness and deteriorating financial performance of distribution companies.

The situation on the DIY retail market in Russia

Information and analytical agency INFOLine annually analyzes the operational and financial indicators of more than 1,000 universal and specialized DIY retail chains, ranking the 600 largest (300 retail chains in each segment: universal and specialized retail chains).

According to INFOLine, in 2015, the volume of the retail trade market for construction, finishing materials, goods for home and garden in ruble terms decreased by 5% - to 1.46 trillion rubles, which is the minimum value for the period since 2009. However, even in the face of declining consumer incomes and changes in the spending structure, in which the share of food products has increased significantly, the market for household goods and repairs has demonstrated a high level of stability - for example, the decline in sales of non-food products as a whole in monetary terms was 10%.

The Hard DIY market (materials for construction and rough finishing) turned out to be the most vulnerable during the crisis; the decline in sales in this segment at the end of 2015 reached 16.7%. The Soft DIY segment (finishing materials) felt significantly better last year: compared to 2014, the drop in sales on the market was only 0.3%.

For many Russian DIY retailers in 2015, there was a tendency to change the assortment structure, in which the share of construction and finishing materials was reduced, where it is difficult for them to compete with international chains (primarily with the aggressive price leader of discount hypermarkets Leroy Merlin), and their replacement was carried out household goods. Retailers in the DIY market, primarily developing multi-channel sales, in the face of rising costs of attracted traffic, are trying to increase the average check by expanding the assortment through additional product categories, such as goods for the home, garden, bathhouse, fishing and hunting, etc. An analysis of the assortment matrix of the 40 largest DIY chains in Russia with a total market share of up to 40% showed that 17 of them expanded their assortment due to the development of the category of goods for home and garden.

Dynamics of income and expenses of the population

Decrease in retail trade turnover in monetary terms in 2015–2016. was due to a reduction in real wages and real incomes of the population, as well as in the volume of consumer lending, and occurred against the backdrop of a sharp devaluation of the ruble and the intensification of inflationary processes. Pressure on consumer spending on goods was exerted by an increase in the structure of expenses in the share of funds allocated for servicing and repaying bank loans. This factor, in turn, is due to rising interest rates and the inability to refinance debt obligations in the face of tightening bank requirements for borrowers.

In 2015, real incomes of the population decreased by 4%, and real wages by 9.5% (these figures are significantly worse than during the crisis of 2009). Russian consumers experienced the strongest shock since the 90s, associated with a large-scale decline in income and deteriorating confidence in the future. These changes have led to a revision of the criteria for selecting goods in terms of price/quality/brand ratio, as well as retail outlets where purchases are made (in terms of assortment/price/location factors).

Every year, INFOLine news agency creates a rating of the largest operators in the Russian DIY market - INFOLine DIY Retail Russia Top - based on operational and financial indicators, in which chains are ranked by net revenue (excluding VAT). At the same time, INFOLine specialists use the following sources: 1) reporting of international companies under IFRS; 2) management reporting of companies (through questionnaires, surveys and interviews of market operators, clarification of information from top managers of companies); 3) reporting of companies according to RAS (analysis of reporting is carried out for all legal entities that are part of a holding or group of companies); 4) estimated indicators for non-public companies (through monitoring of more than 5,000 media and network development indicators).

In 2015, the threshold for entering the TOP 30 DIY chains was about 2.5 billion rubles excluding VAT and showed a decrease of almost 5% (in 2014 – 2.6 billion rubles) against the backdrop of stagnation and declining sales from a number of regional DIY retail operators due to the accelerated rate of decline in household incomes in the regions compared to Moscow, St. Petersburg and cities with a population of over a million, and the opening of Leroy Merlin hypermarkets in the capitals of the constituent entities of the Russian Federation.

The Leroy Merlin chain has secured leadership in the Russian DIY market for many years: its retail sales are higher than those of the next 5 places in the ranking of the largest DIY Retail Russia Top retailers - OBI, Castorama, Petrovich, SaturnStroyMarket and Maxidom - combined. At the same time, the company is a leader in organic growth (volume of commissioned space) and in the future intends to continue its development: according to the company’s plans announced in March 2016, over five years the number of hypermarkets in Russia will increase from 46 to 140, opening on average up to 20 hypermarkets. In 2016, Leroy Merlin plans to open 15–16 hypermarkets, and the total investment in development will be about 30 billion rubles, which is more than the total investments of the TOP-30 largest DIY retail chains in Russia.

Indicators of the ten largest DIY operators

In 2015, the key players in the Russian DIY market (the top ten in the INFOLine DIY Retail Russia Top rating), despite the crisis in the industry, managed to maintain their positions. At the same time, the leader among Russian chains - STD "Petrovich" - due to entering the market of Moscow and the Moscow region, expanding the range and increasing the share of online sales, maintained high growth rates, approaching the achievement of an ambitious goal - in the coming years to reach 2nd place after Leroy Merlin.

One of the key changes in the DIY market last year was the situation around the Metrica retail chain, which closed more than 60 retail properties and, having reduced retail space by 50%, dropped out of the top 10 at the end of the year due to financial problems and conflicts with suppliers. (the amount of unsatisfied financial claims amounts to several billion rubles). To reduce the debt burden, Metrica put up for sale 8 plots with a total area of ​​about 390 thousand square meters. m and a business center, and already in 2016 sold a hypermarket with a site on Vyborg highway to Kesko. At the same time, since the end of 2015, the founder of Metrica, Evgeny Lebedev, has been negotiating the creation of a joint venture network with the largest online retailer Yulmart based on retail facilities.

Number of stores of the largest DIY operators

The leaders in the increase in retail space were Leroy Merlin (opened 8 hypermarkets in the Altai Territory, St. Petersburg, Moscow, Chelyabinsk, Tula, Penza regions and the Republic of Tatarstan), Maxidom (2 hypermarkets in the Sverdlovsk and Samara regions) and Baucenter, opened a hypermarket in Novorossiysk with a sales area of ​​16 thousand square meters. m.

Development of the DIY format

According to calculations by specialists from the information and analytical agency INFOLine, at the end of 2015, despite the crisis, large retail chains operating in the DIY segment practically did not slow down the pace of construction and commissioning of new hypermarkets and continued to increase the retail space of their facilities. Last year, 27 new hypermarkets were opened in Russia, and the total increase in retail space was about 225 thousand square meters. m.

As of January 1, 2016, there were 383 DIY hypermarkets operating in Russia with a total sales area of ​​more than 2.7 million square meters. m. For comparison: as of January 1, 2015, there were 368 stores of the studied format in Russia with a total area of ​​about 2.6 million square meters. m.

Among the significant openings of 2015, two Megastroy hypermarkets of the Agava company with a total retail area of ​​20.5 thousand square meters can be noted. m (in the Republic of Bashkortostan and the Ulyanovsk region). Also, two hypermarkets were launched by Maxidom, Dobrostroy (Elko Group of Companies) and Meter (Desyatka Group of Companies), and one each by Baucenter and OBI, as well as a number of other DIY retailers in Russia.

In 2016, Leroy Merlin, as part of the implementation of ambitious plans to triple the number of hypermarkets in 5 years, already in the first quarter of 2016 opened 4 hypermarkets - in Kazan, Kemerovo, Novokuznetsk and Yaroslavl. During the second and fourth quarters of 2016, the retailer plans to open another 11–12 hypermarkets. It should be noted that not all international retailers are increasing the number of facilities in Russia: for example, Castorama closed one unprofitable hypermarket in Moscow in the Capitol shopping center with an area of ​​more than 6,000 square meters. m.

For most modern people, DIY (do it yourself, “do it yourself”) means goods for handicrafts and the actual products of this handicraft. But in fact, the DIY market is a huge thriving segment of modern eCommerce. It includes stores selling products for construction and repair, gardening, cottages, as well as home decor, furniture, tools, plumbing fixtures and much more. Moreoverconstruction and repair- the most extensive niche, let's talk about it.

Let's consider this niche as a starting niche for a new online store and answer the question: is it worth it? And if so, what should you pay attention to?

50% are goods for construction and repair

The DIY market can even include, for example, the production and sale of craft beer, or the sewing of designer wallets. But the share of this type of product will be microscopic. Still, half of the total sales volume is made by goods for construction and repair - this is about 22 billion rubles according to Data Insight for 2015.

By the way, in Europe, DIY stores first flourished in the post-war period, the mid-forties - everyone needed building materials to restore damaged homes. The war enriched not only fuel suppliers and gunsmiths.

So, one of the most popular goods is building materials, plumbing fixtures and tools for repair and construction.

The market is getting crowded

DIY has become one of the most fast growing segments, “household goods” even entered the top 5 according to InSales for 2015, showing an increase of 60% (“building materials” is slightly less, 44%).

The growth was mainly due to large chains going online. Therefore, you should not think that opening a store and increasing the rankings of successful ones will be easy. Moreover, it is worth considering that only about half All well-known chains have opened their online stores - which means competition will intensify.

Big players rule the market (but only in big cities)

Leroy Merlin, Castorama, Megastroy and other hypermarkets that everyone knows about are offline chains that decided that it would be nice to go online too.

It's incredibly difficult to compete with them, even if you have an investor - these retailers have poured billions into developing and promoting their online stores.

However, there is such a small but pleasant feature - large players do not enter cities with small populations. The exception is Leroy Merlin, which has begun expansion into cities with 200+ thousand inhabitants and is introducing a new format for its stores there.

Otherwise, competition in small cities is significantly less, and you can try to bite off your part of the market.

Scheme: chose on the Internet, bought in a store

The following scheme works in DIY: people choose goods and compare prices online, and go to buy them in an offline hypermarket.

This behavior can be explained by two factors:

• Buyers want to inspect many products in person on the spot, to study the texture, material, and quality.
• One important segment of buyers is professional builders who purchase goods and deliver them to the site themselves.

Thus, you will most likely need an offline location. However, the same scheme does not work with all products - customer behavior and their preferences to buy online or in a store differ from category to category.

Differences exist even within the same category, with some products more likely to be purchased online than others in a physical store.

For this reason, stores in the DIY segment should pay special attention to the possibilities of multi-channel sales and a seamless customer experience. CRM costs and worth including in your business plan.

Bad economic situation is not so bad for DIY

This segment of e-commerce suffers less during the crisis - which cannot be said about many other industries (for example, electronics or clothing). This is due to several factors:

1. People put off purchasing a new home until better times and instead make renovations.
2. Many people do not go on an expensive vacation abroad; they spend it at their dacha.
3. It is becoming more profitable to make it yourself rather than buy it in a store - therefore, various raw materials (fabrics, furniture fittings, etc.) are beginning to be in demand.

It cannot be said that DIY is thriving in a crisis - many networks have significantly reduced the number of their branches, Metrica turned out to be in a difficult financial situation. However, the decline in the solvency of the population does not hit DIY so hard - for example, “Petrovich” after the crisisdemonstrated sales growth by 20% (the share of online sales also increased from 14 to 23%).

DIY is sensitive to changes in the housing market

Since half of all movements in this segment are sales of goods for construction and renovation, it is not surprising that fluctuations in the residential and commercial real estate market also rock DIY sales.

“Due to the current realities, 53% of Russians surveyed in the third quarter of 2016 consider the current conditions for making large purchases to be unfavorable. At the same time, only 9.2% of Russians hold the opposite opinion.” ( Retailer.ru )

At the same time, the volume of housing put into operation and the volume of mortgage loans issued are decreasing.

Data: Retailer.ru

All this, as expected, leads to problems in the DIY market, sales are falling:

Data: Retailer.ru

Buyers have become very price sensitive

The low solvency of the population, the desire to save on repairs by doing it on their own - these prerequisites are pushing stores towards a policy of discounts and sales.

“Demand has shifted towards goods in the middle and low price segments and consumers have become very sensitive to various promotions and sales. In addition, today buyers are increasingly choosing domestic goods: their prices are more stable” -Maria Evnevich, Maxidom network.

For online, this means: the store must maximize its presence in the buyer’s information space, communicate profitable offers quickly, with a high percentage of “hits” with the audience.

We remember that in DIY, the shopping chain often begins online - therefore, the priority tools for online stores in this segment are communication tools - they help deliver the message about the discount to the buyer on time:

It is also worth paying attention to the automation of all communications (trigger letters and web pushes), this will allow the online store to significantly save its budget.

Every customer is worth their weight in gold

Despite the fact that most buyers will look where it is cheaper, without giving preference to any particular store, retailers should make every effort to retain customers.

Loyalty programs for offline and online, And for online - these tools will help not only to “get the most out of” each customer, but also to intercept an almost lost client on the way to a competitor’s website.

Two groups of buyers

DIY is also interesting because there are two large groups of buyers shopping here, and their behavior is radically different.

1. Professionals.Builders, renovation specialists - this group of clients makes up the core of buyers in any DIY store. The products that interest them are power tools, building materials (used at all stages of repair, from roughing to finishing). Another peculiarity of this group is that they do not have much experience in online shopping.
2. Households.Residents prefer to buy in the “household goods” and “plumbing” categories. This segment of the audience is much younger; they buy online, often from mobile devices.

In the DIY industry, as in any other, it is important to consider the specifics of purchases. You cannot make mistakes and target offers to the “wrong” audience. Therefore, for example, product personalization in an online store should work taking into account .

Conclusion

Experts predict that the DIY segment will “get off its knees” no earlier than 2019. However, a growing market that is gradually recovering from the crisis is always a good opportunity for start-up stores.

If you are betting on an online service, do not forget about the recommendations that we have given in this article. Use multichannel marketing, industry-specific (progressive) product personalization and modern tools for informing customers about promotions and other events of interest to them.