Russian e-commerce market up 14% in Q1 2017 - Information portal

Russian e-commerce market up 14% in Q1 2017

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04.07.2017 Количество просмотров 284 views
In Q1 2017 Russia’s e-commerce market grew to RUB 240 billion (up 14% year on year). The Association of Internet Commerce Companies (AKIT) expects that for the entire 2017 it will exceed RUB 1,150,000 billion.  

The market showed lower growth rates in Q1 2017 because, typically, the first quarter is not the highest season in the year in terms of purchasing power. Another reason was a successful Q1 2016. AKIT, however, hopes to see e-commerce growth rates go above 20% for the whole year.

Cross-border trade continues to grow faster than the market in Russia where the playing field is uneven for local and foreign companies. Cross-border trade volumes in Q1 2017 jumped to RUB 89 billion (up 26% year on year). Given this segment’s rates of growth, the Association expects it will reach RUB 420 billion for the whole of 2017 (37% of the entire e-commerce in Russia). Foreign online shops sent out 72 million parcels in Q1 2017 (up 52% in year on year), with AKIT’s estimate for the whole of 2017 being 400 million. The average value of one parcel is currently RUB 1,250 against RUB 3,500 for foreign online shops. 

Russian Post continues to grow its share of the e-commerce market. In Q1 2017 it was up 2% and now accounts for 66% of the total number of parcels.

Home appliances and electronics e-commerce market showed 3.7% growth in 1Q 2017 year on year (to RUB 50.2 billion) despite some pressure on growth rates resulting from a very successful 1Q 2016. However, online shopping continues to be an increasingly popular trend. AKIT expects this segment to have grown by 16.5% to RUB 240 billion by the end of 2017. It is worth noting that compared to foreign companies local players suffer from an uneven playing field, this being the reason why this segment did not grow as sizeably as the entire e-commerce market across Russia.

Home appliances and electronics is still the most advanced class of online sales. In Q1 2017 around 19% of all revenues were generated online. This figure is comparable to the developed countries, although online shopping as a market in Russia is still in a fledgling state. 
The most popular products in home appliances and electronics include computers and notebooks (28% of the total sales), telephones and smartphones (23%) and large-sized home appliances (22%). Small-sized appliances (+11.9%), computers and notebooks (+7.2%), telephones and smartphones (+4.4%) are amongst the most rapidly growing categories. Buyers are showing increasingly less interest in photo cameras. In Q1 2017 photo camera sales were down 14.4% year on year. A similar trend was seen in consumer electronics (down 0.4%).  

Interestingly, sales across the Central Federal District were down whereas regional sales were up: the contribution of the Central Federal District to sales volumes fell from 47.8% in Q1 2016 to 42.5% in Q1 2017. Leaders in sales growth include the Siberian, the Far East and the Urals Federal Districts (+22.5%, +20.4%, and +18.4% respectively). 

We will discuss this and other topics at the 5th International PLUS Forum Online & Offline Retail 2018, the key event for retail in Russia and the CIS.

Source:  AKIT


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