Conquering regions
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Conquering the regions Boris Lepinskikh, CEO E96.ru 2014 June 4, e-Days e-commerce conference
description
Кейс о покорении регионов: проблемы, вызовы и возможности новых рынков
Transcript of Conquering regions
Conquering the regionsBoris Lepinskikh, CEO E96.ru
2014 June 4, e-Days e-commerce conference
About us: local touch, global ambitions
2014 June 4, e-Days e-commerce conference
2007 - company foundation
2013 - net revenue 4,6 B rubles (+65% Y/Y)2013 - we operate in 19 regions (delivering in 1003 places with our own logistics)
2013 - raising round А from IQ One Holdings for expansion and business development
2014 - 400 000 SKU (+100% Y/Y)
2013 MAU - 1 MM (+75% Y/Y)
2011 - start conquering regions
2014 - Top-15 most effective online stores (Forbes Russia)
Evolution of regional markets
2014 June 4, e-Days e-commerce conference
2007 2007-2011 2011-2013Federal competition
• Market consolidation, competition goes federal;!
• Strengthening players from regions;!
• Paradox: extremely strong competition on emerging markets.
• Strong regional competition;!
• Price competition;!
• First M&A;!• Moscow
companies starts shipping to regions.
• First local startups;!
• Offline retail entry e-commerce only for branding;!
• High margins.
GrowthVacuum
The structure of regional markets
100 000 — 800 000: 23,3 MM / 70% / +13%
100 000: 31,2 MM / 51% / +10%
31,2 MM
51%
+10%
High level cities(Ekaterinburg, Rostov-on-Don, Perm) Emerging cities (1m population) (Omsk, Krasnoyarsk, Samara, Saratov)
2014 June 4, e-Days e-commerce conference
2014 June 4, e-Days e-commerce conference
Markets go on growthing at different speeds (infrastructure, broadband penetration, depots & logistics)
Distrust consumers; Strong competition in price and service;
Problems
X-companyM.VideoEldorado
Less sources of external traffic (High level cities - 75-90%, Emerging cities - not more than 60%); Logistics, logistics, logistics again («final mile», pick-up point , outsourcing).
2014 June 4, e-Days e-commerce conference
Market opportunity
New users live outside two capitals
Source; TheRunet
Moscow
St.Petersburg
Villages
Big Cities(1MM)
500K-1MM
100K-500K
<100K
Number of runet users will jump to 70 MM by 2014 = new internet-customers;
Engaging traditional buyers to online buyers.
New geographic markets;
% $
0
200
400
600
800
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2011 2012 2013 2014 2015
2014 June 4, e-Days e-commerce conference
Market opportunity
Ekaterinburg
KrasnoyarskTyumen
Rate of growthN%-share high level market = 5N%-shareemerging market
X m investment at high level market = Х/2 m investment at emerging
5N%-share at emerging market easy than N%-share at high level market
