Russia's e-commerce market slowed drastically in 2015
BII
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Growth in the Russian e-commerce industry slowed to just 6.6% in 2015, down from 31% in 2014, according to a recent report from the Economic Foundation.
Revenue for 2015 came in at $23 billion, only slightly above the $21 billion earned in 2014. The slowed growth can be largely attributed to a weaker Russian economy, which saw its local currency — the ruble — lose approximately half its value during the year. E-commerce growth in Russia is expected to slow further in 2016, with a projected growth rate of only 5%.
The number of online shoppers in Russia has actually continued to grow steadily. There were roughly 30 million online shoppers in Russia in 2015, up 13% from 2014. And the number of people in Russia turning to e-commerce has been growing steadily since 2012.
However, individual Russian consumers are spending less, on average, than in the past. Average annual consumer spending on e-commerce sites was $818 in 2014, but dropped to $757 in 2015. Clothing items continue to be the most purchased goods online for Russian consumers, while information technology (IT) is second.
Online shoppers in Russia are now turning to China to buy their goods. A weakening economy and falling currency have led Russian consumers to foreign websites when shopping online. This is because these shoppers can find greater product offerings, as well as cheaper prices, in other marketplaces.
Russian consumers who made a cross-border transaction online in 2015 cited a better price (47%) as their main reason for purchasing abroad, while a greater product range was the second biggest driver (37%), notes the report. In particular, Chinese online marketplaces are becoming a go-to destination for Russian online shoppers, especially as increased shipping efficiencies decrease delivery times between the two countries.
The influx of Russian consumers in the Chinese e-commerce market comes at a time when Chinese shoppers are looking elsewhere to purchase online, amid concerns about quality and safety standards. Chinese e-commerce merchants may begin to place greater importance on the Russian consumer, in an effort to supplement losses in domestic sales.
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