Modern FMCG retail is gradually shifting fr om extensive growth to competing for customer loyalty, reports belretail.by. Against the backdrop of market saturation, high financing costs and the growth of online commerce, retailers can no longer rely solely on increasing the number of stores. Personalization, omnichannel capabilities and the quality of the customer experience are becoming key growth drivers.

These conclusions were presented by Alexey Gorbatenko, Director of Syndicated Research and Special Projects at GfK Rus, localized under the ICMR brand, as part of the Retail Monitor study. Launched in Russia in 2017 and expanded to Kazakhstan six years later, the project was conducted in Belarus for the first time.

The study surveyed 3,300 respondents from Belarusian cities with populations of 10,000 or more.

Kazakhstan: High Inflation Restrains Retail Growth

Retail markets across the CIS are developing differently. In Kazakhstan, high inflation, which remains at around 12% according to the study, is putting pressure on households’ real disposable incomes.

As a result, the projected 4.8% growth in retail turnover was not achieved. Unlike Russia and Belarus, wh ere real disposable incomes increased, in Kazakhstan income growth has largely been offset by rising prices.

At the same time, experts note a long-term trend toward the gradual convergence of consumer standards and income levels in Kazakhstan, Belarus and Russia.

The End of the Race for Square Meters

One of the major changes in retail is the slowdown in extensive expansion. Growing retail chains through the mass opening of new stores is becoming increasingly difficult due to high construction and borrowing costs, a shortage of quality locations and the gradual decline of traditional unorganized retail.

Under these conditions, retailers are increasingly competing not through the number of new outlets, but through the quality of their value proposition — the Customer Value Proposition (CVP).

In practice, every retail chain faces the same question: why should a customer choose this store rather than a competitor next door?

Several key factors influence consumer choice:

• pricing positioning;
• assortment and the availability of exclusive products or private-label brands;
• quality of the customer experience;
• atmosphere, navigation and level of service.

For modern retail chains, the combination of these factors is becoming the foundation for competing for customer traffic.

Kazakh Consumers Visit an Average of 2.5 Retail Chains

The study also highlights significant differences in consumer behavior across the region.

The average consumer in Belarus regularly visits around five retail chains, while in Russia the figure is 7.5. In Kazakhstan, the average is just 2.5 chains.

One reason is the country’s geography and the density of its retail infrastructure. Kazakhstan is significantly larger than Belarus in terms of territory, yet the number of stores operated by major retail chains remains considerably lower. As a result, consumers, particularly in smaller cities, often have fewer options when choosing between different retail chains.

At the same time, Kazakh consumers tend to plan their purchases more carefully. Shoppers are more likely to visit a store with a pre-prepared shopping list, partly because of the need to manage household budgets more carefully.

Convenience Brings Customers In, While Atmosphere Builds Loyalty

One of the key findings of the study is the distinction between the factors that encourage consumers to make a purchase and those that make them recommend a retail chain to others.

The main driver of store visits remains convenient location. Consumers may regularly visit their nearest store even without having an emotional connection to the brand.

However, atmosphere and customer experience play a greater role in building long-term loyalty. Cleanliness, convenient navigation, short queues, quality product displays and staff performance are important factors contributing to a high NPS (Net Promoter Score) — customers’ willingness to recommend a retail chain to others.

Discounts and promotional campaigns can stimulate short-term demand, but on their own they do not always create lasting customer attachment to a brand.

Loyalty Programs Are Evolving into Digital Ecosystems

Experts also highlight the transformation of loyalty programs. While they were previously built primarily around discount cards, retailers are now moving toward personalized offers, mobile apps, gamification, subscription models and cashback.

In Russia, the market for such solutions has already reached a high level of maturity, while in Belarus the development of digital customer-value management tools remains a promising area.

For retailers, this creates an opportunity to move away fr om mass discounts toward more targeted customer engagement. Algorithms can generate personalized offers based on an individual customer’s purchase history and behavior.

This trend is also relevant to the Kazakh market, wh ere digital services and personalization are becoming an important part of interaction between retail properties, tenants and shoppers.

In particular, TSPM. is developing the Smart Plaza mobile app, which combines service functions and a loyalty program for visitors to Dostyk Plaza and Shymkent Plaza. The use of digital tools makes it possible to create more personalized communication with audiences and enhance the customer experience beyond traditional visits to a shopping center.

Convenience Stores Remain a Key Competitive Format

Convenience stores remain one of the most important segments of modern retail.

This format combines a convenient location, the ability to make quick everyday purchases and a relatively low average basket size. At the same time, competition in the segment is intensifying: stores need to provide fast service, an adequate assortment and a comfortable customer experience simultaneously.

Experts note that traditional paper promotional leaflets will gradually give way to digital tools. Instead of mass discounts, retailers will be able to make greater use of personalized coupons and individual offers.

Discounters Are Moving Toward a “Value Convenience” Model

Another important trend will be the development of modern hard-discounter formats.

Consumers continue to look for ways to save money, but they are increasingly unwilling to sacrifice comfort for lower prices. The traditional warehouse-style format is gradually giving way to a model that combines affordable prices with a high-quality customer experience.

Modern hard discounters are characterized by a limited but carefully selected assortment, a high share of private-label products, clear navigation, clean sales floors and a higher level of service.

Experts refer to this model as “value convenience.” Its development could become one of the key trends in the regional FMCG market in 2026–2027.

Omnichannel Is Becoming a Necessity

At the same time, as offline formats continue to evolve, retailers are being forced to develop online sales more actively.

Online delivery puts additional pressure on business margins due to picking and logistics costs. However, abandoning this channel could result in customers switching to marketplaces and delivery services.

In response, retail chains are moving toward an omnichannel model that integrates physical stores, mobile apps, online orders and express delivery.

Offline spaces are also changing. Convenience stores are increasingly introducing in-store bakeries, ready-to-eat food areas and coffee points. These services create an additional reason to visit a store and provide a customer experience that cannot be fully replicated online.

Hypermarkets Are Turning into Experience Centers

Traditional hypermarkets face a separate challenge. Their core function — making large stock-up purchases — is increasingly being replaced by online services and smaller retail formats.

Consumers can increasingly order large quantities of goods for home delivery or purchase what they need at a nearby store without spending several hours traveling to a hypermarket.

As a result, large-format retailers are having to find new reasons for customers to visit. One solution is the development of experiential and event-based marketing.

Experts identify food festivals, tastings, themed events, children’s workshops and entertainment activities among the promising areas. Hypermarkets are therefore gradually transforming fr om spaces focused exclusively on shopping into destinations wh ere shopping becomes part of a broader leisure experience.

Retail Is Shifting from Scaling Up to Understanding the Customer

The main conclusion of the study is that the era of growth based primarily on opening new stores is gradually coming to an end. In an increasingly competitive environment, customer retention technologies, personalization, omnichannel capabilities and the creation of unique customer experiences are becoming increasingly important.

In the new competitive environment, the winner will not necessarily be the retailer that opens the most stores, but the one that can better understand its customers and offer the most convenient and relevant way to interact with them — both online and offline.

For commercial real estate, this trend also means further transformation of retail spaces: their value will depend less on the number of tenants and increasingly on the quality of services and experiences they provide, as well as their ability to create reasons for visitors to return regularly.