The visits of Russian tourists to Finland are more often same-day visits to purchase foodstuffs and household goods. Also overnight stays have declined significantly since last year. In order to keep Finland attractive to tourists now and in the future, the competitiveness of Finnish service sectors needs to be taken care of.

Russian tourists visit Finland less than before, they spend less time here, and are now spending less money than before. These are the findings of a survey* recently conducted by the Finnish Commerce Federation.

According to the border interviews conducted with Russian tourists in the first half of this year, the vast majority (72%) of trips are same-day visits. However, same-day visits are not only shopping trips but they have also replaced longer holiday trips.

The number of Russians travelling to Finland often, at least once a month, has increased from last year by almost 5 percent. Whereas the number of Russian visitors spending several nights in Finland has decreased.

The data obtained by Statistics Finland and The Finnish Border Guard also support these results. For example, paid overnight stays by Russian tourists declined in the first half of this year by 11 percent since last year.

Already last year, the majority of Russian tourists in Finland were of lower income and they also spent less money. The same trend has continued this year. According to the border interviews conducted in January–August, a Russian visitor spends EUR 236 this year in Finland, of which EUR 162 is spent on product purchases. While last year, Russians spent approximately EUR 40 more on product purchases.

Russian tourists are now focused more than before on buying foodstuffs, household items, sweets, and children’s clothing.

A change in visitor profile, decrease in overnight stays, and reduction in the number of visitors are reflected also in tax-free purchases. According to the statistics of Global Blue Finland, the company refunding value added tax on tourists’ purchases, the value of Russians’ tax-free purchases fell 30 percent in January–September compared to the previous year.

January is still the high season for Russian shopping tourists.

“Even though tax-free sales decreased in January compared to the previous year, the importance of January as the high season shopping month has recently been emphasised. In many cities, it is more important than ever to be able to get the Russians’ dwindling Euros into their own pockets on Epiphany,” says Jaana Kurjenoja, Chief Economist of the Finnish Commerce Federation.

While the amount of tax-free purchases has decreased, the value of an individual invoice purchase has even increased. This is not a surprise, since more and more stores have introduced invoice stamping, in which case VAT will be refunded when visiting Finland again.

Russian consumers will also become digitised

A natural cause for the decrease in Russian shopping tourism is the deterioration of the economic situation in Russia and the weak ruble. It is not assumed in Finland, however, that the situation will return to normal after economic conditions have improved.

“The purchasing power of the Russian consumer may remain low for a long time, but even after that things may not necessary be restored to normal. The visitor profile of Russians travelling to Finland may focus also in the future on hoarding visitors with low income while the visitors spending a lot of money will travel somewhere else,” warns Kurjenoja.

Already 40 percent of the Russian tourists visiting Finland have shopped digitally. Visitors in the age group 25–34 years and those arriving from Moscow have made online purchases more often than others. These are the visitors that are using services in Finland in a more diverse way than others and hoard food and household goods less frequently.

“Digital commerce and the multi-channel approach are developing also in Russia. Multi-channel consumers easily ignore Finland if our physical and digital services are not attractive enough,” says Kurjenoja.

Juhani Pekkala, Managing Director of the Finnish Commerce Federation, states that it is important to take care of the competitiveness of Finnish service sectors, especially now that the competition concerning Russians is tightening and the opportunities for Russians to travel are reduced.

“Finland cannot afford not to exploit the potential brought about by Russian tourists. The government should make every effort to encourage Russians to come shopping here also in the future. The tax burden on the service sector should be lightened. Companies should also not be burdened with new regulations or by stiffening the labour market,” says Pekkala.

 

* The study is based on the statistics of Global Blue Finland, travel statistics of The Finnish Border Guard and Statistics Finland, as well as the border interviews conducted by Tutkimus- ja Analysointikeskus TAK Oy.

** Tutkimus- ja Analysointikeskus TAK Oy interviewed 7,130 Russian tourists aged at least 15 at the border in January–August.

For further information, please contact:

Jaana Kurjenoja, Chief Economist of the Finnish Commerce Federation, +358 (0)9 1728 5134, jaana.kurjenoja(at)kauppa.fi

Juhani Pekkala, Managing Director of Finnish Commerce Federation, +358 (0)9 1728 5111, +358 0400 419 560, juhani.pekkala(at)kauppa.fi

The Finnish Commerce Federation represents commerce - the largest sector of economic life. Commerce employs around 300,000 persons in Finland. The Federation has around 7,000 member companies and represents both retail and wholesale commerce in industry policy and labour market lobbying. www.kauppa.fi