Earlier this month Bringly, the cross-border e-commerce marketplace of the Yandex Market group of companies, stopped accepting orders – just one year after its launch in beta version.
The group intends to transfer its cross-border offers to Beru.ru, another marketplace initially designed for domestic purchases.
Bringly aimed to become “a truly global platform, including both cheap goods from China and alternative supplies, notably from Turkey and Western countries.” Bringly also aimed to experiment new models, such as marketplace-to-marketplace and manufacturer-to-consumer.
Bringly’s experienced staff and the deep pockets of its shareholders, Yandex and Sberbank, did not bring the expected success. Meanwhile, not only did AliExpress maintain its absolute leadership on the Russian cross-border scene, it also garnered the support of new shareholders and partners through Alibaba’s alliance with Mail.ru Group.
In an exchange with East-West Digital News, an industry insider attributed Bringly’s failure to a combination of such factors as:
- A lack of strategic focus from the shareholders, which continued developing a variety of other businesses, in comparison with the concentration of AliExpress Russia and its shareholder Alibaba on the sole cross-border business;
- The slow-down of the Russian cross-border e-commerce market;
- The lower-than-expected appeal of supplies from Western countries.
Not only do Western e-merchants still have to put up with Chinese platforms, they now also face competition from a new generation of small Russian brands. These enjoy a growing traction among domestic consumers, as exemplified by local fashion makers selling through Wildberries, the leading Russian e-commerce site.
As Bringly announced the suspension of its service, Russian Post launched a new cross-border marketplace with an exclusive offer of Japanese goods. Dubbed ‘Kupijapan,’ the site offers cosmetic products, healthcare, bodycare and wellness items as well as an assortment of knives. Orders are delivered to post offices or to consumers by courier.
Market highs and lows
Over the past five years, foreign online stores have become hugely popular in Russia. As of September 2018, according to a GfK-Yandex survey, 76% of Russian e-shoppers declared to have made online purchases from abroad – almost as many as those who said they made purchases from Russian websites (88%).
In 2018, the Russian cross-border sales market (foreign sites selling physical goods to Russian online consumers) was estimated at 348 billion rubles (about $5.55 billion) by Data Insight. The E-Commerce Russia Association puts the estimate at $3.24 billion.
The number of orders reached 300 million, up 34% from 2017, says Data Insight. Russian Post alone processed 345 million e-commerce shipments to Russia, up 22% from 2017.
Continued growth on this market is not certain, however, according to a recent research by East-West Digital News. Citing Q1 2019 data from Russian Post and the customs, some industry experts warned that cross-border e-commerce flows might stall this year. Meanwhile, some leading platforms – mostly Chinese ones – saw their traffic decrease significantly between August 2018 and June 2019, according to industry analyst Alexey Petrovsky.
