A socially oriented non-financial development institution and a major organizer of international conventions, congress, exhibitions, business, social and sporting, public, and cultural events.

The Roscongress Foundation is a socially oriented non-financial development institution and a major organizer of international conventions; exhibitions; and business, public, sporting, and cultural events. It was established in pursuance of a decision by the President of the Russian Federation.

The Foundation was established in 2007 with the aim of facilitating the development of Russia’s economic potential, promoting its national interests, and strengthening the country’s image. One of the roles of the Foundation is to comprehensively evaluate, analyse, and cover issues on the Russian and global economic agendas. It also offers administrative services, provides promotional support for business projects and attracting investment, and helps foster social entrepreneurship and charitable initiatives.

Each year, the Foundation’s events draw participants from 208 countries and territories, with more than 15,000 media representatives working on-site at Roscongress’ various venues. The Foundation benefits from analytical and professional expertise provided by 5000 people working in Russia and abroad. In addition, it works in close cooperation with 155 economic partners; industrialists’ and entrepreneurs’ unions; and financial, trade, and business associations from 75 countries worldwide.

The Roscongress Foundation has Telegram channels in Russian (t.me/Roscongress), English (t.me/RoscongressDirect), and Spanish (t.me/RoscongressEsp). Official website and Information and Analytical System of the Roscongress Foundation: roscongress.org.

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Russia’s Golden Era for E-Commerce
4 June 2021
10:00—11:15
KEY CONCLUSIONS
Online stores have gained a large number of buyers due to the pandemic

The pandemic has not only changed the world and every process within it, it has changed each one of us. The months-long restrictions on traditional retail and people’s movement naturally made buyers and sellers move online – even the most behind-the-times and conservative ones. Online consumption is no longer the domain of Millennials and Generation Z. Indeed, online stores have seen the arrival of a cohort of people – including even reticent individuals – aged between 44 and 55. Here are a few statistics: during the pandemic, between 29% and 39% of consumers in this age group discovered for themselves at least one online store. For businesses, the pandemic immediately heralded several trends across a range of different areas. The markets themselves changed, the borders closed, and disruption to logistics chains led to purchases within Russia increasing. <...> Before 2020, e commerce market penetration grew at a rate of below 1%. However, last year, it grew by 2–2.5% — Irina Parfentieva, Deputy Chief Editor, RBC.

The effect of the crisis took online marketplaces by surprise

Last year, <...> for example, we personally expected a crisis of sorts, simply following the laws of economics. We just didn’t understand where exactly it would come from. I think what happened would have taken anyone by surprise. <...> It’s been an interesting experience, because over the course of a month–six weeks or so, we realized that, put bluntly, we had to do something. In our case, we began to prepare. For example, we rented additional warehouse space to make operations flow more smoothly. Nevertheless, we still ended up being pretty overwhelmed by what happened. We had to restructure operations very quickly. <...> Any crisis, and in particular, it seems to me, the crisis of last year, shines a spotlight on issues that exist, let’s say, not only in our business. Indeed, the crisis not only highlighted issues in the e-commerce sector, but those in the country, and maybe even in the world. I remember, for example, how in late 2019 me and Maxim Akimov [CEO of Russian Post – ed.] were at Skolkovo and discussed how it was essential to transition to the digital economy — Tatyana Bakalchuk, General Director, Wildberries.

ISSUES
E-commerce is developing at a rate which makes it impossible to regulate using old principles

What we are seeing in the world is a <...> fundamental change in the way economies work. Economies are moving away from an industry-based principle, where there is a specific industry offering a specific product or service. <...> Now there are ecosystems, where things are not built upon a specific product or service, but rather on people as consumers. Goods and services then converge around these people. <...> Accordingly, e-commerce is what is already being built around consumers and people. This marks a systemic transition from an industry-based principle to a systems-based one. Naturally, it is impacting everything, both in Russia, and around the world. And commerce is no exception. That is why it is no longer a question of regulating it as an area of trade as such – it is a question of regulating ecosystems, in which <...> e-commerce [is – ed.] one element, a mechanism — Maxim Oreshkin, Aide to the President of the Russian Federation.

The sheer scale of online marketplaces makes it essential to adopt special approaches to doing business

Three years ago, we discussed what now seem to be simple challenges. At the time though, they appeared to be completely impossible. Three years ago, we had only just come up with Lavka, for example. It all looked so simple to us – open a store, select some products, and ship them. But then we ended up with hundreds of little stores, and each one had completely different operations in place. You’d have thousands of warehouse workers, and orders would be delivered by tens of thousands of self-employed couriers. You need to produce goods under your own trademark, otherwise it’s uneconomical. And all these problems were impossible to anticipate from that point — Daniil Shuleyko, Head of E-сom and Ridetech, Yandex.

The development of some areas of e-commerce is being held back by legislation

I think that we will grow fairly independently, although we are currently using, or rather beginning to use <...> some elements of an ecosystem, which are undoubtedly helping us a great deal. But if we consider large online marketplaces and pharma, everyone greedily looks at this category, but underestimates the confines created by legislation. That’s because a large marketplace creates an expectation among consumers. People are used to having a single, integrated service, which also offers delivery. You can get your orders sent to a collection point, or get them delivered to your home. People are used to this service. No matter what you order, there is a single customer pathway. However, when it comes to medicines, you cannot get them sent to collection points. It’s impossible to pick up medicines from a parcel station, and medicines cannot be shipped a long way without using specialized vehicles. It’s also impossible to store medicines at central warehouses, because the warehouses need to be specially licensed for that purpose. Specialized pharmacists need to work there, and you cannot store non-pharmacy-related items in the same place. So, essentially, in order to provide the same kind of customer experience for non-prescription medicines alone, you need to build an entire chain – the kind that the retail sector has spent 20 years building — Anton Buzdalin, General Director, eApteka.

SOLUTIONS
Attract new sellers to online marketplaces and offer discounts to buyers

The Russian market is very competitive. <...> There is a huge amount of money floating around which is being invested in this market. Take the players who are present here [at the session – ed.] and factor in those who are not here – I would say that you are looking at hundreds of millions of roubles which are being invested in the market. As a matter of fact, you get two sides benefitting from this. These are the two sides that make up a marketplace. The buyers benefit – and that is pretty evident to everyone. Consumers everywhere see the adverts, understand loyalty programmes, discounts, etc. But the sellers benefit too. In general, I believe that competition for sellers will only intensify, and ultimately, the seller will be the one who wins. And in fact, small businesses are set up to be the best sellers in a marketplace, because they are the healthiest players in this ecosystem, this process — Dmitriy Sergeev, Chief Executive Officer, AliExpress Russia.

Should one area fail during a crisis, ensure the overall ecosystem survives through other initiatives

It seems to me that in terms of [the pandemic – ed.], we have come out of it better than many others, because we have a fairly broad portfolio of services. By this I mean we have, I don’t know, purely digital services, such as Yandex Zen and Search, which have gone from strength to strength, since people have been spending more time at home and using our IT products. The team there has been developing something new every second for people to use, it seems to me — Daniil Shuleyko, Head of E-сom and Ridetech, Yandex.