Russia could be the next big ecommerce country
Russia has an increasingly wealthy and Internet-savvy population of some 143 million, but ecommerce is not that big at the moment. But that could change very soon, as different international ecommerce gigants like eBay, Alibaba and Asos are expanding their presence.
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When you’re an big online retailer of marketplace, you’ll look around for emerging markets, especially those that are largely untapped. Russia seems to be one of these countries as it has 60 million Internet users, the most in Europe, and it still not a typical ecommerce country like Germany or the United Kingdom.
Where in other countries the ecommerce boom got a hold of a lot of European countries, it had passed Russia by. And the ‘why’ is understandable. Most Russians don’t have credit cards or are worried about using them online. According to the Wall Street Journal because of the unrealiable postal service, some consumers are waiting weeks for parcels that are sent from abroad.
But a solution was near. Local companies started offering cash-on-delivery services, so the two aforementioned problems were out of the way. Ozon Group, sometimes called ‘the Russian Amazon’, had revenue of almost 370 million euros last year, two-thirds more than it achieved in 2011. And if Ozon can grow that hard in Russia, other global ecommerce companies could too, right?
Morgan Stanley expects the Russian ecommerce market to triple to 27 billion euros in 2015, nearly 5% of all Russian retail sales. At the moment online sales account for less than 2% of the total retail sales. But the expected growth could happen because of the commitment of companies like eBay. This year it launched a Russian-language website and it now has gotten permission from regulators to use its payment service PayPal. Next year, Russian consumers can use this site to sell and buy products. And the Chinese ecommerce gigant Alibaba Group this year also launched a Russian-language version of its AliExpress marketplace site. Amazon isn’t officially launching something in Russia, but rumors are that it has been hiring top managers to develop an online business there.