By Peter Boldt-Christmas | Insight Analyst

The Russian ecommerce market is set to triple in size in the next five years. With an increasing number of Russian consumers purchasing online, and cross-border trade growing rapidly, Russia should be on your business roadmap. 

The prospect of trading in-market with a lack of native expertise can be intimidating. The Russian market differs significantly to Europe in logistics and payment types, leading western brands to deprioritise Russia in favour of other more familiar markets.

Russian Ecommerce market growth.jpg

With more and more retailers asking what it takes to excel in the Russian market, we take a look at the five things you need to know to successfully trade online:

 

1. As cross-border trade is increasing, offering local language and currency will increase sales

  • With 30% of the population shopping cross-border at least once a year and parcels from foreign online stores expected to rise to 400 million, it’s important for businesses to take advantage of this, particularly in China.
  • The online market is dominated by Chinese players, whose close proximity and sophisticated logistics mean they are able to get products into the market fairly quickly and at reasonable cost.
  • Russia was the largest cross-border participant in Singles Day from Chinese Marketplaces in 2017.
  • More than half of searches in Russia begin on local search engine Yandex. Businesses selling in Russia should ensure they are aware of how to optimise their SEO for Yandex searches. A main difference is geotargeting, which is much more important for Yandex. Retailers should optimise for the areas in Russia they are focusing on.

 

2. Cash on Delivery (COD) is essential to success 

  • Approximately 60% of domestic sales are paid via cash on delivery as Russians like to guarantee quality of goods prior to paying; offering this payment method is increasingly important
  • As the Russian ecommerce market matures, the share of COD is slowly decreasing. E-wallets such as Yandex Money and Qiwi are growing but not yet mainstream, making up approximately 5% of transactions.

 

3. Click & Collect is important as courier delivery decreases by 6% YoY

  • The geography of Russia means expectations are divided between urban and rural regions. In the largest cities, delivery is expected in two days, but in rural regions delivery times can extend beyond 20 days.
  • Click and Collect is a popular delivery option, with 72% of Russian consumers choosing to collect online purchases from store or pick up point.

Russian Consumer behaviour - Receiving online purchase.jpg

 

4. There is a strong preference for personal customer service in Russia

  • Online-only customer services are not sufficient, with up to 10% of orders still being made over the phone.
  • It is important to include clear and prominent customer service details across your website. Once a consumer places an order, Customer Services often contact them to obtain personal details and upsell products. 
  • Russia has the highest number of monthly active social media users in Europe (38.5m vs 37m in the UK, or 82% of their online population). Social media, and especially Vkontakte, should play a big part in your customer service proposition.

 

5. Don’t underestimate the importance of marketplaces

  • With marketplaces accounting for the fastest growing segment of Russian ecommerce, it’s important to consider marketplaces as a route to market.
  • Wildberries is one of the largest online stores of clothes, footwear, accessories and cosmetics and Alibaba have launched AliExpress.

Russia most visited ecommerce website.jpg

If your business is currently trading in Russia and you are disappointed with ecommerce sales, or if you need help planning a Russian market entry strategy, please get in touch with our team of local trading experts. Contact us at hello@practicology.com.
 

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