E-Commerce in Russia

59 Pages·2016·17.54 MB·English

E-Commerce in Russia
E-COMMERCE IN RUSSIA
What brands, entrepreneurs and investors need to know
to succeed in one of the world’s hottest markets
What international merchants, service providers and entrepreneurs
must know to succeed in a fast-changing market
MARKET INSIGHTS – FEBRUARY 2017
RE S E A RC H PARTN ERS
NAMO
National Association of Mail
Ordering and Distance Selling
E-COMMERCE IN RUSSIA
About this report
This report is offered by East-West Digital News, the international resource on Russian
digital industries. It reflects a monitoring and research effort which has been conducted with
dozens of industry players and experts since 2011.
Companies interested in this market may request more detailed data and analysis, or
strategicadvice, which East-West Digital News and its associated experts will provide on
demand. Please send your inquiry to [email protected]
About the publisher
East-West Digital News is the first international information company dedicatedto Russian
digital industries. Its website EWDN.COM provides news, market data, business analysis
and updatespertainingto the Internet, e-commerce, mobile and telecomindustries, digital
TVand satellite systems, software and hardware innovation, as well as to the related
investmentactivity and legal developments.
A consulting branch, East-West Digital Consulting, provides international players with
assistance for business development in Russia and advises Russian companieson their
international strategies.
For more information, please contact us at [email protected]
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E-COMMERCE IN RUSSIA
Table of contents
Key market trends and figures 4
Market insights 7
1. The RussianInternet market 8
2. The domesticonline retailmarket 11
3. Cross-border sales 19
4. Operations 22
5. Legalaspects 25
6. HR: The most painfulissue 26
Interviews 28
Ozon.ruCEODannyPerekalsky 29
NextRussiaSite Manager Olga Evteeva 31
B2B-Center.ruCEOAlexeyDegtyarev 33
Select articles 39
Russiane-commerce in crisis: Molotokshutsdown, Mamagazin
suspends activities 40
Ozonnot profitable yet, but expectsfastgrowthand stillconsidersWestern IPO 42
SberbankintalkswithAlibabatolaunchuniversale-commerceplatform
inRussia 45
Loyalty program, mobile payments, personaldata storage:
How ChineseAliExpressconqueredRussiane-commerce 47
L’Oréal Group launchesmono-brand e-commerce sites in Russia 49
Russia’s B2B-Center and China’sXBNiaoteam up in cross-border B2B trade 51
How Russiane-wallet users makepaymentsonline 52
GeoPostacquiresmajoritystakein Russia’sSPSR Express as local
shipping market consolidates 55
DownloadEWDN’s free report on Russian e-commerce:
E-commerce in Russia (English): http://www.ewdn.com/e-commerce/insights.pdf
E-commerce in Russia (Chinese): http://publications.ewdn.com/china-russia
Personaldata storagein Russia (English): http://publications.ewdn.com/personal-data-storage
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E-COMMERCE
I N R U S S I A
K E Y T R E N D S
& F I G U R E S
To request more detailed data and analysis, or strategic advice,
on the Russian e-commerce market, please contact East-West
Digital News at [email protected]
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E-COMMERCE IN RUSSIA
Key trends and figures
RUSSIAN E-COMMERCE IN 2016
Source: Data Insight unlessotherwisestated
Total market size for physical goods:
Up +23%
800 bn
from 2015
Domestic sales of
physical goods,
rubles (or +14% in USD)
not including
cross-border
(approx. sales; food
deliveries, C2C, +
MLM, tickets, Cross
$12bn)
coupons, etc.
-border sales:
$4.3bn
Source; NAMO
or of the total Russian
3%
approximately retail market (or 4% if
including cross-border online sales)
30 More than
million More of orders
were made
online shoppers than
via mobile
generated an estimated 40%
devices
195 million orders
(+20% from 2015)
Average order value Approx.
in 2015: 4,050 rub. ($65)
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E-COMMERCE IN RUSSIA
Key trends and figures
K E Y M A R K E T T R E N D S
1 The domestic market generally grew in 2016 in real terms,
but certain segments were still affected by the crisis
Becoming more mature and competitive, and facing a less
2
favorable macroeconomic environment, the industry is
now entering a period of optimization and consolidation.
Some pure players are still witnessing fast growth, while
3
others are facing financial difficulties with some even
going bankrupt.
Most major offline retailers and manufacturers keep
4
4 developing online and mobile sales channels and the
related infrastructure.
Since 2014, venture investment activity has decreased
5
considerably – but some investors are still interested in
e-commerce related services.
Most large and mid-sized cities are served by shipment
6
companies in satisfactory conditions, while the Russian
Post is reforming itself to improve service.
Cash-on-delivery is the rule for physical goods and will
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remain so for a long time, even though the use of
electronic payments is increasing slowly.
The lack of qualified human resources appears to be
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one of the most painful issues, hampering the entire
Internet industry.
Cross-border flows from China are increasing dramatically
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while most western online retailers have seen their sales
to Russia fall due to the ruble’s depreciation since 2014.
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E-COMMERCE
I N R U S S I A
M A R K E T
I N S I G H T S
To request more detailed data and analysis, or strategic advice,
on the Russian e-commerce market, please contact
East-West Digital News at [email protected]
7
E-COMMERCE IN RUSSIA
Market insights
1. The Russian Internet market
1.1. Internet penetration
Russia, which lagged far behind most other European countries in terms of Internet
penetration in the recent past (with a 37% penetration rate in 2010), has been catching up
rapidly over thepastfewyears.
In late 2015, according to a GfK poll, Internet penetration exceeded 70%, with 84 million
Russians aged 16 or more — up 4 million in one year — declaring that they use the
Internet.
Much of the growth can be attributed to mobile connectivity. According to GfK, mobile
Internet access in Russia more than doubled during the year. By the end of 2015, 37.5% of
users 16 and older went online by way of their phone and 19.5% from tablets (up from
17.6% and 8.4%, respectively, in 2014). Thus approximately 50 million Russian users (42%
oftheadult population) accessedtheInternetfrommobiledevices asoflate 2015.
1.2. Regional contrasts
Russians in bigger cities and primarily Moscow are more practiced Internet users. The
Internet penetration in Moscow exceeds the country average and has a significantly higher
mobile and tabletusesthanotherareas.
Russians from places with smaller populations are less practiced Internet users but the
regions are slowly catching up with larger cities thanks in large part to mobile
accessibility. Oftenthelower costsofmobile connectivity encourageInternetuse.1
Among thekeyfactors explaining theseregional contrasts are differences in thestandardof
living, purchasing power and development of broadband and wireless Internet access, as
well ascomputerand Internetliteracy.
In 2015 almost three quarters of all Russian Internet users lived in the European part of
Russia.
1.3. Russian audience worldwide
Total Russian-speaking audience nears 110 million users, taking into account an
approximate 25 million Russian-speaking users in the former Soviet republics, Western
Europe,IsraelandNorthAmerica
1. http://russiansearchmarketing.com/everything-mobile-devices-platforms-and-cost-of-connectivity-in-russia-2015/
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E-COMMERCE IN RUSSIA
Market insights
Internet penetration in Russia
(16 y.o. and older), 2008-2015
Types of Internet
use by age in 2015
Mobile Internet penetration (16 y.o. and older), 2013-2015
Source: GfKOmnibus survey 2015, all Russia, 16+
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E-COMMERCE IN RUSSIA
Market insights
Distribution of Internet users by federal district
(winter2015-2016)
Source: FOM
INDUSTRY REPORT
SUWPIPTOH RTTH OE F PERSONAL DATA
STORAGE IN RUSSIA

PERSONAL DATA
What international businesses should
STORAGE IN RUSSIA
What international bu sinesses should know know to organize data transfer to
to organize data transfer to Russia and maintain
ongoing compliance with Russian law
V1.1 – A PRIL 2015 Russia and maintain ongoing
compliance with Russian law
A comprehensive analysis by East-West Digital News
with EY’s top legal analysts and key market players
Request your free copy at [email protected]
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